The gaming industry is a cultural phenomenon, commanding billions of hours of attention across the globe. By 2029, the number of gamers is projected to surpass three billion, per Statista. It’s unsurprising that the 2024 estimated revenue for the industry came to almost $455 billion.
Smart brands have long seized in-game advertising opportunities. Smarter brands are using them to change the way they connect with players.
With dynamic, real-time placements tailored to audiences, programmatic ad buying has changed the field for good by unlocking new revenue streams and opening the door to hyper-targeted campaigns and immersive formats unimaginable in traditional media. For players, the impact varies – in the best case scenario the ads improve the gaming experience, in the not so good scenario, they can alienate the very audience they’re meant to engage.
With the rise of programmatic ads in video games, the industry stands at an inflection point. Brands, developers, and platforms all need to navigate this evolution thoughtfully to maximize the massive potential: in-game advertising worldwide revenue is projected to reach $124 billion in 2025.
It’s no surprise that brands are riding this wave. The creativity you can bring to an in-game experience offers a far richer way to connect with audiences, from virtual product placements, local notices, and in-app billboards. For many of us, our ability to access Balenciaga is much more realistic in Fortnite than in life. And although it may not have swung the election, former President Obama’s team didn’t leave anything to chance with in-game billboards in Burnout Paradise during his 2008 Presidential campaign.
Gamers are more than casual participants — they’re deeply engaged. Between mobile devices, PCs, and consoles, players log hours of immersive screen time, making this medium attractive to savvy marketers who want to run tailored campaigns.
It’s also one of the best ways to reach certain demographics, including Gen Z. Projections for 2024 indicated that more than 20% of users aged 18 to 24 would rather play video games than watch television. And gaming isn’t just for a male audience, either. Mobile-only gamers are predominantly female.
The ability to reach niche, hard-to-access audiences via programmatic ads works for all parties. Indie and mid-tier studios can make money beyond game sales and in-game purchases and developers don’t need specialized expertise or significant time to implement as platforms handle much of the heavy lifting, allowing studios to focus on the narrative and storytelling for how to insert ads seamlessly into gameplay.
For brands, in-game ads are relatively cost-efficient. The biggest concern is ensuring brand-safe environments – few brands want to be seen next to harmful content. Platforms like Bidstack, Frameplay – who launched their own Exchange in 2024 – and Anzu, who announced their partnership with Stagwell at Cannes Lions also in 2024, all focus on delivering the personalization and control brands require while finding the most reach within digital worlds.
While the future is bright for brands looking to creatively engage with their target market, there are still very real issues about the scalability of in-ad games, particularly as dollars flow into programmatic buys. Fraud, player pushback, and privacy concerns are top of mind for many marketers.
Ad fraud is an expensive problem, accounting for $84 billion in marketer losses in 2024 (about 22% of all online ad spend). Contrary to popular belief, fraud attempts are 25% lower for in-app advertising than on the web. Thanks to advancements in machine learning and blockchain tracking, there is increasing transparency around ads served and verification of placement.
Privacy concerns permeate marketing and media. As the data we have access to becomes richer it has also become even more of a contested topic with Governments and consumers at the same time. Respecting player consent and following ethical practices, especially when targeting younger gamers is crucial for brands and table stakes for the platforms themselves.
Ultimately any brand looking to experiment with in-game ads and any CMO or agency proposing the idea will be judged on the business result. In-game ads are not just about branding (awareness and reach) if executed well, there is a real path to impacting business results. Take the partnership between Fortnite and musician Travis Scott. The virtual concert brought together 12.3 million gamers and generated millions in sales across Fortnite bundles, merchandise, digital downloads, and sales of Scott’s music.
There is no doubt that programmatic advertising is extending and reshaping the gaming experience. This shift is evident in AppLovin, a company that connects advertisers with mobile game developers, whose stock has surged over 700% in the past year. Making it clear that ad tech platforms leveraging AI and programmatic automation are thriving. Brands that embrace these new immersive, hyper-targeted campaigns can generate an edge for themselves in an ever-competitive market. And with the rise of innovative tech and advanced platforms these types of opportunities are also more accessible to smaller players. Cooperation is essential for success. Brands should partner with developers to ensure ads complement gameplay, and ad tech platforms must prioritize transparency and innovation. The goal is a system where players feel valued, ads drive meaningful engagement, and creativity thrives.