What Is In-Game Advertising And How Does It Work?

Gaming is big business. Eight in ten Internet users aged between 16 and 64 can be defined as gamers, with billions of people worldwide playing on console, PC or mobile every day. That's an enormous potential audience for advertisers to reach. That’s why in-game advertising (IGA) should be a key part of the marketing strategies in 2025.

Gamers are a highly engaged audience. Research suggests gaming environments generate higher viewability and attention rates. People play for long periods of time, with more than one-quarter of Americans (27%) spending between one and five hours a week gaming. Players have given In-game advertising a collective thumbs-up, with nearly seven out of 10 feeling positive or neutral about it.

To date, however, IGA is still a massively untapped media channel for brands. While there is some evidence that brands are starting to shift ad budgets toward gaming, 2025 could be the year we see it reach another level.
 

The Challenges Of Developing Effective In-Game Advertising

One major challenge for brands wanting to break into in-game advertising is that the definition of gaming is so broad, covering a multitude of platforms, formats and devices. Not only are there a plethora of different game genres, but gaming content can also be accessed through platforms such as Twitch and YouTube, with live e-sports content also a significant draw for online audiences. Brands may be left feeling uncertain about where exactly to make their investments.

To add to the confusion, the definition of in-game advertising covers two distinct types of advertising: traditional IGA, where ads pop up every so often, breaking the flow of the game for the player, and intrinsic IGA, where the ads are integrated into the world of the game. The former experiences can leave much to be desired, with interruptive ads delaying players as they seek to complete their quest. However, watching ads may earn the player a reward, and some ads even feature interactive, playable elements that aim to engage audiences. But in my view, this type of IGA is not where the big opportunity for brands lies.

For me, the untapped potential of IGA is in intrinsic advertising that is baked into the gaming environment itself. For example, the recent partnership between retailer Intersport and Electronic Arts (EA) Sports FC 25 illustrates how gaming companies can open up premium inventory within game environments to benefit advertisers. Such experiences represent the growing sophistication of IGA, offering less disruption and more interactivity to players. Brands such as Louis Vuitton and Nike have also been ahead of the crowd, partnering with Fortnite owner Epic Games and creating interactive campaigns with in-game clothing or footwear, and skins for avatars.

But intrinsic IGA isn't just an opportunity for advertisers with huge budgets. Fortnite's Creative Mode is a sandbox where brands can build IGA experiences for players. Amazon has also opened up its Amazon Anywhere platform, which lets advertisers showcase products within gaming and virtual environments so players can find out more information about items and even purchase them as they play.
 

How Brands Should Approach In-Game Advertising

Innovative collaborations are the way forward for brands that want to get ahead in this area. Rather than playing solo, a multiplayer approach comprising gaming companies, brands and media platforms is the winning combination needed to make the most of IGA.

Combining gaming platform data with advertiser insights can create relevant, timely experiences within a game environment. Gaming platforms have a wealth of first-party data that can be leveraged for direct advertising opportunities. Insights such as age, location and areas of interest can help brands connect with their ideal audience across platforms. Moreover, knowing whether a player is on mobile, console or PC helps optimize campaigns for the best experience.

However, gaming platform data has value beyond in-game environments. Making data insights available to brands and media owners can enable off-site activations across social media, digital and connected TV (CTV) platforms. The level of consumer intelligence that gaming companies have accessible makes creating gaming media networks (GMNs) that function in a way similar to retail media networks (RMNs) a real possibility.

These GMNs have the potential to link gaming companies, brands and media owners together in a way that can facilitate highly engaging advertising solutions, reaching players not only as they game but across all touchpoints. In addition to planning and executing effective campaigns within gaming environments and across other media, as well as by connecting in-game purchases with brand and retailer sales and media exposure data, advertisers can measure the effectiveness of these campaigns and calculate their return on investment.

Most importantly, these collaborations must be developed around privacy-enhancing technologies (PETs) to protect each partner's first-party data from exposure, leakage or misuse. Respecting consumers' privacy is vital not only to maintain trust with players and customers but to satisfy regulatory requirements. While the possibilities offered by IGA are massive, they must be approached responsibly as the reputational damage and legal consequences of not doing so would be a cost too high to bear. It truly would be Game Over.
 

Leveling Up IGA Strategies Is A Cheat Code For Success In 2025

With billions of players and endless creative opportunities, in-game advertising offers brands the chance to connect with highly engaged audiences like never before. At the same time, gaming companies can leverage their first-party data in partnership with these brands and media organizations to create cutting-edge, personalized advertising experiences. As long as these collaborations are based on fully consented data collection and respect for consumer privacy, IGA doesn’t just drive results. It creates experiences that players actually want.