Mobile gaming is Australia’s fastest growing entertainment channel
As entertainment takes on a new significance in our daily lives, Lance Traore explores why mobile gaming is one of the most effective, and underutilised, engagement channels available to advertisers.
As isolation restrictions continue to ease for most in Australia, we continue to see the impact the pandemic is having on people’s use of time. Working from home has eliminated commute times for many, time which a lot of people have used to consume more media. Most media channels have seen growth in time spent and/or frequency of usage. However, the clear standout when it comes to growth is gaming and mobile gaming specifically. Before the pandemic, gaming was already the biggest digital entertainment channel for all Australians according to Nielsen’s Digital Panel (May 2019). Now more than ever, it’s imperative for brands to take a clear strategic look at gaming and how they can use it to connect with their consumers.
In March this year, AdColony launched a piece of research surveying 1,000 Australian respondents, which revealed an uplift in time spent playing mobile games. The survey found that 57 percent of Australians now play games daily on their mobiles, which is up from 43 percent prior to the COVID-19 outbreak. Further to this, 67 percent of Australians say they are playing more mobile games since the pandemic and since March, 47 percent of Australians have downloaded new games onto their smartphones. Perhaps the biggest and most interesting change was seeing 40 percent of completely new gamers since the start of the outbreak.
When we think of forms of entertainment, our minds turn to the popularity and influence of online streaming services, going out to the movies and tuning into our favourite radio station as they each represent mainstays of our modern consumer life. In 2019 the global box office was worth almost $61 billion, the SVOD industry about $76 billion and traditional radio now hovers at around $57 billion.
Mobile gaming as an entertainment channel is significantly larger than all of these three, in 2019 it was a $98 billion market globally, representing almost half of the global gaming market (estimated at $217 billion). By 2021 it is estimated that mobile gaming will generate the largest proportion of total gaming revenue worldwide. So, it’s not necessarily the current size of the market that we should be impressed with, it’s the speed of growth of this channel.
Looking at the PwC Global Entertainment & Media Outlook report, of all of the major entertainment channels (we can see that three channels) that are included in the Top 5 in terms of CAGR, are all intertwined with mobile games:
- Internet advertising. Mobile accounts for two-thirds (67 percent) of all digital ad spend and is the biggest driver of its growth. Much of the in-app mobile ad space that is being sold at high volumes is within free-to-play games.
- Video games and esports. The video game industry as a whole is growing so fast that some believe it will reach over $420 billion by 2025. There are over 2.5 billion gamers in the world, and with more consumers looking for in-home entertainment options, interest in esports and home-based video games will accelerate industry growth at a faster rate. As passion for gaming grows worldwide, the natural crossover from console and streaming services (e.g. Twitch) to mobile games will further increase the flow of users to mobile.
- Virtual reality. VR was born out of gaming, and many would say that it is gaming. While there has been recent uptake from retail brands and the events industry, at its core VR is driven by gaming. The VR market alone is projected to reach $40.2 billion by 2024, and it is not tied to console.
a) In fact, there are entire app marketplaces dedicated to VR apps on Android and iOS, and with the affordable Google Cardboard and Samsung Gear VR, turning your mobile phone into a full-body and sensory gaming experience is accessible.
b) The rise of new 5G networks will also drive VR headset adoption, as high-resolution games will be able to be played seamlessly, without interruption.
Mobile gaming is now on pace to be a big, if not the biggest, part of the entertainment industry. As it grows and becomes more ubiquitous, like the traditional media channels noted above, it becomes easier to understand how broad the demographics are.
There is often a stereotype associated with the average ‘gamer’; a young, underemployed male, perhaps living in his parent’s basement. According to some psychological studies about stereotypes, gamers are seen as “unpopular, unattractive, idle and asocial”. But gamers are everyone. According to GlobalWebIndex, almost 73 percent of Australians aged 16-64 are gamers. It’s grocery-buyers, auto-intenders and any kind of audience you can think of.
However, mobile gaming as an advertising channel is still severely underutilised because the Australian advertising industry is still blighted by the legacy stereotypes of who a gamer is.
From an advertiser standpoint, mobile gaming is the only place outside of BVOD where you can get full-screen video at scale. That in combination with the fact that almost 73 percent of all mums (who have children still living in their households) are mobile gamers, should mean that all FMCG brands would have a strong presence in mobile gaming – yet this is far from the case.
Whilst competitors continue to fight for TV impressions, those brands moving to the mobile gaming channel means reaching the same audience, with higher quality impressions for a fraction of the cost. Mobile gamers pay more attention to ads in the in-app environment than any other placements: 40 percent versus 17 percent in other digital channels.
Mobile gaming should no longer be considered niche media, we are slowly starting to see a shift in the way brands are thinking about gaming as an effective engagement channel, and the short and long-term opportunities that exist.
Lance Traore is the country manager, ANZ, at AdColony.