As we kick off the new year, we’re covering trends from key markets in 2022. We’ll recap the state of each industry over the past year, the ad strategies of its biggest players, and what we predict 2023 will hold.  

The number of people who play video games is expected to surpass 3.8b in 2027, up from roughly 2.4b in 2017. 

We can attribute much of this growth to the pandemic’s stay-at-home orders and people’s desire to escape the stress and isolation—nearly two-thirds of Americans played video games during the pandemic. 

Gaming companies benefited. 

Nintendo announced record profits in 2021, which increased by over 80% YoY. Meanwhile, game streaming viewership nearly doubled during the pandemic. 

While the amount of time people spend gaming is dropping, it’s far from falling out of grace with advertisers. 

Here’s how gaming advertisers spent in 2022 and what 2023 may hold as people resume their normal, out-of-the-house lives.

MediaRadar Insights on Gaming Advertising in 2022

Despite a dip in gaming in 2022, more than 2k companies still spent nearly $1.6b to promote gaming products, representing an increase of 6% YoY. 

The most significant increase came in Q3 when advertisers boosted spending by 22% YoY to more than $370mm. A level deeper, spending in July and August was up by more than 32% YoY, while September remained flat. 

The spending spree in Q3 makes sense as advertisers geared up for the perpetually busy holiday season. Despite the down economy and layoffs, holiday spending grew by 7% YoY.

Spending in Q4 increased as well—this time by 9% YoY and 46% QoQ. 

Much of this increase came thanks to considerable investments from advertisers at Activision Blizzard (Call of Duty: Modern Warfare, Overwatch 2, etc.) and Ubisoft (Just Dance, Mario + Rabbids Sparks of Hope, etc.), who both increased spending by more than 500% QoQ. 

At the same time, Bluehole Studio (The Callisto Protocol) and Nuverse (Marvel Snap) were up by 1,000%+ QoQ. Blue Studio’s ad investment was 100% digital media, with 73% purchased programmatically. 

Game Titles Drove Ad Spending in 2022

While advertisers across the gaming world invested in ads in 2022, more than half of them (64%) came from those promoting game titles. 

Last year, 1,035 companies promoting more than 2k games invested $1b, representing a 28% YoY increase from 2021 (a 10% YoY decrease in the number of advertisers). 

Advertisers for Activision Blizzard (Candy Crush, Call of Duty, and World of Warcraft), Playrix (Fishdom, Manor Matters, and Township), and Tencent Holdings (Fortnite, Lab Rat, etc.) were front and center.  

The spending from advertisers at Tencent Holdings comes in the wake of the continued success of Fortnite. While it’ll be impossible to replicate Fortnite’s surge in popularity during the pandemic, the game still has a firm grip on society. In December 2022, people watched 46.1mm hours of Fortnite streams on Twitch.

Advertisers for Tencent Holdings are spending to maintain their illustrious status—99% of Fortnite’s investment went to video ads across nearly 50 properties—but also to fend off the competition. 

PUBG: Battlegrounds, for example, reported more than 425k concurrent streamers on Steam in November 2022.  

At the same time, advertisers for 1047 Games promoted its debut game, Splitgate, on the heels of a $100mm round of funding. 

While advertisers for Playrix opened their wallets especially wide in 2022 to promote Fishdom, Manor Matters, and Township, a reallocation is possible as the mobile gaming market declines.

Other gaming advertisers in 2022 

Advertisers for game titles weren’t the only ones who spent millions in 2022; the other $575.3mm (36%) of gaming ad spend came from a mix of online games, video game consoles, gaming systems, simulation gaming systems, video game websites, etc. 

However, most of that spending ($411.5mm) came from advertisers promoting online games, video game consoles, and gaming systems. 

Despite spending millions, 2022 was a down year for many of these advertisers. 

The 320 online game advertisers, for example, reduced spending by 10% YoY to $217mm. 

Advertisers for Tencent Holdings, Square Enix (Final Fantasy XIV Online), and Microsoft (The Elder Scrolls, Fallot 76, etc.) accounted for 53% of the investment to promote online games. 

The decline in spending from online game advertisers is likely two-fold: people are spending less time indoors and more time cutting their budgets, which could impact ad spending in 2023. 

Meanwhile, spending on video game consoles dropped by 19% YoY, while spending to promote gaming systems was fairly flat at $50mm. 

For console advertisers, the decrease isn’t an indication of their dwindling status but a result of a year lacking substantial launches; Sony and Microsoft launched their next-generation consoles in 2020.

Don’t let the declining ad spend paint the wrong picture, however. Sony shipped more than 7mm PS5s in December 2022. Millions welcomed this news after over two years of supply shortages that made headlines. 

While Xbox Series X and S sales trail those of the PS5, Microsoft is okay; the company’s gaming revenue reached $16.23b in 2022, up from $15.37b the year before. 

Record sales of these consoles despite a reduction in ad spending paints a clear picture: people will buy consoles whether they see ads or not. 

Further proof: The Nintendo Switch became the third-best-selling console ever, passing the lifetime sales of the PS4 and Game Boy. 

The Recession Could Put a Cap on Gaming Ad Budgets

No one will deny the popularity of video games. But, at the same time, no one can ignore the financial pressure and anxiety caused by the down economy. 

So, what will give in 2023? 

Will video games’ popularity spur ad spending, or will less consumer spending put a cap on budgets? 

Time will tell, but given the number of people who’ve expressed financial anxiety due to the economy, the latter seems more likely. 

That said, gaming advertisers will still open their wallets in 2023, especially as the holiday season nears. 

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