The great gaming consolidation: Why marketers should sit up and take note

The race to create and define how the metaverse looks and feels within games is a key factor driving 2022’s gaming acquisition fever. The metaverse is a whole new way to interact, live and play online, where virtual worlds within games can be explored and monetised, writes Richard O’Sullivan, VP & general manager ANZ, InMobi.

The gaming industry is in the middle of a merger and acquisition frenzy, with major tech players snapping up game makers for record-breaking figures.

Sony Interactive Entertainment’s $3.6 billion bid at the beginning of February for video game maker Bungie – maker of cult favourite games including Destiny, Halo, Myth, Oni, and Marathon – comes hot on the heels of Microsoft’s acquisition of Activision Blizzard for $69 billion.

So what is driving the race to buy? Firstly, the obvious: big tech is following the money. The gaming industry is a hugely lucrative market, and it’s only getting bigger. According to App Annie’s latest mobile gaming report, mobile gaming is expected to surpass $120 billion in 2021 – putting it well ahead of both the movie and television industries.

Who are today’s gamers?

Sure, some gamers still play via desktop, laptop and TV and headset, but it’s mobile which has really helped gaming out of its niche and into the mainstream. From Candy Crush to Fortnite, the cliché of the teenager gaming in the basement is no longer reflective of the reality of gaming.

Many marketers still hold onto the outdated assumption that gamers ‘aren’t our demographic’. In almost every single case, this simply isn’t true. According to a recent consumer study, mobile gamers span the generations, with 30% of all gamers in Australia over the age of 45, 45% between 25-44 and 25% aged 18-24. They’re not all male, either: in Australia, women make up 58% of gamers.

Enter, the metaverse

The race to create and define how the metaverse looks and feels within games is a key factor driving 2022’s gaming acquisition fever. The metaverse is a whole new way to interact, live and play online, where virtual worlds within games can be explored and monetised.

In a call to investors, Microsoft CEO Satya Nadella explained how the company sees the metaverse as ‘a collection of communities and individual identities anchored in strong content franchises, accessible on every device.’

With the advent of the metaverse, gaming environments are looking at going beyond the traditional game and creating a platform for social connection. Games like Fortnite and Roblox are increasingly becoming a place to hang out with friends, earn digital items and collectibles, buy, lend money, and meet new people.

Several brands are already moving into the space, with the likes of Ralph Lauren and Gucci already hosting fashion shows on metaverse and gaming platform Roblox. Pop star Ariana Grande has also gotten in on the metaverse action, with a series of virtual concerts inside popular multiplayer game Fortnite, and Disney has named an executive to lead its metaverse strategy.

In-Game advertising

For marketers, this increased interest and investment in gaming will mean a potential upswing in branding and advertising opportunities. One of the more interesting trends in this burgeoning space has been the growth of in-game advertising, sometimes known as native in-game advertising. In-game advertising is already used by 94% of mobile game producers in their free-to-play games, and the market is expected to grow by almost $11 billion by 2024.

The IAB defines in-game as ‘directly influenc[ing] gameplay visuals/audio with their messaging or alter[ing] the gaming experience through skins and sponsored content.’ Ad formats can include static and dynamic banners, video, and audio ads. Think, for example, about all the traditional out-of-home ad formats available in the real world. Now take those formats, and picture them within a metaverse-style game. The virtual cityscape might include the exact same ads on bus stops, billboards, and within shopping centres. Thanks to the rise of in-game advertising, brands now have the opportunity to programmatically place ads in these scenarios.

Hellmann’s in-game activation within Animal Crossing is a great example of in-game advertising that enhances, rather than detracts from the game. The campaign involved players being encouraged to drop off their rotting veg on ‘Hellmann’s Island’. For every turnip dropped off, Hellmann’s donated two meals to the FareShare food bank, resulting in 100,000 meals donated to real-life food banks.

Clearly, marketers cannot afford to miss the huge awareness and brand-building opportunities inherent in this huge, diverse global gaming audience. Gaming is starting to go mainstream now, with mainstream brands taking notice. This means the marketing potential could be as big as the metaverse itself: limitless.

Richard O’Sullivan

Richard O’Sullivan VP & general manager ANZ, InMobi


Get the latest media and marketing industry news (and views) direct to your inbox.

Sign up to the free Mumbrella newsletter now.



Sign up to our free daily update to get the latest in media and marketing.