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USA game ad revenue to reach $130 billion in 2025

Brands are underestimating the advertising potential in the gaming industry, according to a recent report by GameAnalytics. While gaming is projected to generate a massive $130 billion in advertising revenue by 2025, it accounted for less than 6% of advertising spend in the USA. This discrepancy indicates that brands still perceive gaming as a niche interest, despite its status as the most profitable segment in the entertainment sector.

Mobile gaming, which constitutes 50% of gaming revenue and frequently uses advertising for monetization, remains the primary market for advertisers within the gaming industry. However, the prevailing stereotypes about gamers as primarily unemployed young men have contributed to this undervaluation. In reality, the average age of gamers worldwide is 35, and nearly half of all gamers are women, presenting missed opportunities for brands to tap into a broader and diverse audience.

The report highlights that brands show more interest in high-quality games with respectable content, overlooking potential opportunities in hypercasual games due to their low budget and high churn rate. Advertisers may also shy away from games with excessive in-game ads, as it can lead to user frustration and a negative perception of the advertised products.

However, there is a growing awareness among media buyers about the possibilities of in-game advertising. 81% of media buyers plan to increase their spending, and 93% of those surveyed intend to run in-game advertising by 2025, according to The Drum. GameAnalytics suggests that focusing on quality games and collaborating with agencies and mediation platforms to educate brands on the potential of in-game advertising can attract more attention. Implementing measurement SDKs can help track ad performance and build advertisers' confidence in this market.

Source: Lewis Rees, Staff Writer at PocketGamer

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