By Samuel Huber, CEO and Co-Founder, Admix
Gaming is a $175 billion industry (or $336 billion depending on who you believe) and most of us could easily guess the majority of the countries that make up the top 10 in terms of games revenues. Population size, disposable income and penetration of smartphones and other gaming devices mean it’s a fairly simple formula.
And so these are the markets advertising dollars flow towards when media buyers look to reach lucrative and sizable gaming audiences. These audiences are increasingly found on mobile devices: in fact, 2.8 billion of the world’s 3 billion gamers this year will play on a mobile device and mobile games generate more than half the total global value of gaming. As ‘mobile advertising’ and ‘mobile games advertising’ increasingly become a distinction without a difference, it’s clear that this opportunity is comparable to the early days of social media as a media channel.
The good news for media buyers and brands is that even in mature markets in North America, Western Europe and Asia-Pacific, the adoption of programmatic gaming inventory by non-gaming brands is still low enough to make it a huge opportunity. But to really make the most of gaming as the new media channel, advertisers need to get ahead of the game by starting to broaden the scope of their media plans now.
Emerging mobile gaming markets
Mobile gaming is on an inexorable rise across the globe, making in-play advertising – non-intrusive ads shown within gameplay – a huge growth segment even in established markets. However, the growth rates in emerging markets easily eclipse those of their more mature counterparts. It’s clear that advertisers must pay more than lip service to emerging gaming economies in order to reach vast, mobile-first and increasingly lucrative consumer audiences.
Let’s look at the number of smartphone users by market. Only four of the top 10 countries for games revenues feature in the top 10 in terms of millions of smartphone users. So what, I hear you say? This is down to comparatively large populations, but the audience is less lucrative per capita. While this may be true right now, today, let’s look at our simple formula of population, spending power and smartphone penetration again:
- Population size: Not only are populations of markets such as India far larger than developed economies, they’re also growing at a rate many times higher than western markets, many of which such as Italy and Russia are also experiencing drastic population decline.
- Smartphone penetration: 31.8% in India. 58.6% in Indonesia. 51.4% in Brazil. 54.4% in Mexico. Not only are these countries already in the top 10 for smartphone users, but they have far higher potential for growth than more static developed economies.
- Disposable income: Disparities in GDP per capita have been formed over two to three hundred years and won’t reverse overnight. However, the OECD predicts that global middle-class spending will grow from about $37 trillion in 2017 to $64 trillion by 2030. Most of this growth will be driven by the growth of consuming classes in emerging economies.
India – a case in point
With over 400m smartphone users and many millions more feature phone users, India is an overwhelmingly mobile-first market in which people use mobile devices to play and to pay as well as to communicate. By 2030, its middle class will number over one billion people, tripling their USD spending power to over $10 trillion.
The country already has 420 million online casual gamers, 94% of whom play games on mobile devices. Its annual mobile game downloads outpace those in the US by a factor of two to one. Just 4% of gamers have access to a console and 9% to a PC.
The Admix platform alone has almost five billion units of advertising inventory available across India in any given month, on popular games such as Ultimate Car Driving Simulator, Sushi Roll and Traffic Tour. Each of those ad units is an opportunity to reach a highly engaged, otherwise hard-to-reach audience in an increasingly lucrative market.
We’re all familiar with the acronym APAC, and for good reason. Yet Indonesia, Vietnam, Bangladesh and the Philippines are probably not the economies it brings to mind first, despite their huge smartphone user bases (with relatively low penetration) and economic growth. But what about MENA (Middle East and North Africa)? What if I told you there were 53 million Iranian smartphone users and the average salary in Tehran was almost $22,000?
Let’s look more closely at another acronymic region: LATAM. In a 2020 survey in Latin America over two-thirds of respondents reported spending more than 40 minutes a day playing mobile games. In another survey, 69 percent of adults in Mexico said they played mobile games, while thousands of miles away 68.8 percent of Argentines indicated they did the same.
During the Covid-19 pandemic, time spent playing video games increased by 52% in LATAM (more than any other region). Monthly gaming expenditure in Chile, Brazil and Mexico grew by an average of 50% in the same period. Media buyers with a blinkered approach to their mobile marketing strategies are missing out on huge chunks of global brand uplift and revenue.
Making the most of global growth
Mobile gaming is growing in every national and regional market worldwide. And until recently, the infrastructure to advertise programmatically, non-intrusively, safely and to lucrative audiences in premium environments has been limited – meaning there are huge amounts of growth still available in established gaming economies. Rebalancing ad spending to Indonesia over Ireland isn’t critical today.
But for media buyers looking to future-proof their media plans and get ahead of the game, it’s key to understand not only that the future of the gaming media channel is mobile, but that it’s truly global.