Gaming Is Emerging As Next Dominant Tech Platform

  • by , Featured Contributor, February 25, 2021
The following was previously published in an earlier edition of Media Insider:

One of the things I look forward to in the fall is the latest annual outlook from longtime media industry leader and management consultant Michael Wolf and his firm Activate. I just downloaded and devoured the 148-slide Activate Media & Technology Outlook 2021 this morning and was not disappointed.

It is a very special view on how consumers are changing their media behaviors and preferences, and looks at everything from TV to ecommerce to gaming.

What really struck me this year is one of the report's core theses: Gaming is emerging as not just the fastest growing media behavior among Americans, but as the next dominant tech platform, akin to what we saw in search starting 20 years ago and social over the past decade.

The opening bullet captured it perfectly. “Video Games: Gaming is the new technology paradigm as most digital activities (e.g., search, social, shopping, live events) will increasingly take place inside of gaming.”



I believe that Wolf and his colleagues at Activate are spot-on. Gaming will become the dominant platform for digital activities over the next decade. As a result, gaming will become one of the most important platforms for advertising and marketing during that time frame as well. It will become the place where people don’t just play games but watch their TV and their movies (and their ads, too).

Just look at “Fortnite.” The free-to-play game now has more than 300 million registered users around the world, and is streaming private concerts and full movies to gamers logging on, while collecting more than $5 billion this year in micro-transactions from a small subset of users who buy virtual goods and capabilities to use in the game.

Do I think publishers of games like “Fortnite” should immediately flood their platforms with ads? Absolutely not. The introduction of advertising into these massive and fast-emerging media platforms will require managing a delicate balance centered on a single, simple and unbreakable precept: The gamer is in charge.

These games are so popular because gamers and their friends playing them are the center of this universe. Ad models that emerge on these platforms will have to operate the same way.

What might that advertising look like, then? It will start with permission. I expect gamers will have to consent to accept each and every ad. It will include skipping. Gamers will need to be able to skip any ad they don’t want to watch.

Ads in video games will certainly include rewards. Gamers will need to receive value for ads that they watch. The majority of “Fortnite” players don’t spend on anything in the game, but I’m sure those same hundreds of millions of gamers would also like some of the same stuff their friends are getting. Watching ads to get these perks might be an attractive path.

Bringing ads to premium video games will absolutely require amazing ads, with really great, relevant creative. Sticking in ads from programmatic feeds or taking any old ad off TV or YouTube won’t cut it.

If advertisers want to be welcomed into video game environments, they will need to treat them like the Oscars and the Super Bowl: Create great ads, highly relevant to the event, and fun and memorable to experience.

I suspect the prediction of gaming as the next dominant tech platform may take some time to play out. But, given the acceleration and growth that video game playing has experienced through this terrible pandemic, it may happen much sooner than many people would expect. Ads may be part of this trend sooner, as well.

What do you think?

4 comments about "Gaming Is Emerging As Next Dominant Tech Platform".
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  1. Brad Bullock from Effectv, February 25, 2021 at 4:24 p.m.

    Yep. I've been pushing to leverage gaming for increased advertising oportunities. Only makes sense considering gameing devices can be used for streaming and the audience will spend extended hours playing. Guess the only question is, what's the demographic & purchase power?

  2. Zachary Rozga from Thece, February 25, 2021 at 6:34 p.m.

    100% agree. This is the exact topic that I discussed on a panel on an Esports and Gaming panel - I posit that we are in the transition phase right now and the acceleration of the convergence of activities and abilities to do many of the things we currently do in disparate web pages all happening in a singular virtual environement. And if you take this from an advertiser perspective yes, while we are in the transition this is a "new" area to advertise, but soon it will be "the" place to advertise. And there will be many, many different form factors that this will come in.

  3. John Grono from GAP Research, February 26, 2021 at 5:08 p.m.

    Very interesting take Dave, but I have a couple of thought-starters.

    First, gaming is probably the most immersive digital behaviour.   Gaming is a very 'lean-forward' activity unlike, say, watching a rom-com or listening to music.   While that is great for the genre, 'lean-forward' is not the most conducive environment for advertising, and ad revenues will probably be crucial.

    Second, the jewel in the crown of gaming is Fortnite with its impressive 300m registered users globally,   Putting that another way, with a global population of 7,800 million that is just under 4% are registered accounts (usage is always less on any one day than registered accounts).   It is still a mightily impressive number, but I'm not sure that amounts to 'dominant' - another 20 Fortnite's would be.   And looking at a paralle, in 2019 Avengers:Endgame grossed $2.8b.   Average global admission is probably around $10.   So that means an also captive audience of something like 280m in just 181 minutes per person.

    Third, Statista puts gamers at 2.686 billion in 2020 (just over one in three).   It is also dominated by A-P which has 54% of gamers.

    Yes gaming will be big, growing and important.   But so will many other digital platforms including ones that haven't even been developed yet.

  4. Ed Papazian from Media Dynamics Inc, February 26, 2021 at 7:06 p.m.

    I would add to John's points, Dave, that video gaming is probably a highly concentrated activity ---with a small percentage of gamers accounting for the vast majority of the activity. As a guess, I would not be surprised is a meter  based study found that one tenth of gamers did 50-60% of the gaming---if so, that's a much higher concentration than one would see for TV where the top user decile probably does 30-32% of the viewing. It would be interesting to see some xactual data on this from Nielsen---assuming that it is able to measure all videogame activity with its national panel.

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