DFC Dossier On The State Of Game Advertising

DFC Dossier, a subscription monthly game industry research report, sent contributor N. Evan Van Zelfden to this year s [a]list summit.  Zelfden sat down with the agency s Eric Ayzenberg and Steve Fowler to discuss trends in game advertising.  As talk turned from strategy to execution, Capcom s Mike Webster, director of brand management, and Chris Kramer, director of community and public relations, joined the conversation to talk about the campaign for Resident Evil 5.” 

The following article appeared in DFC Dossier Issue #7 and is reprinted by permission from DFC Intelligence.

The Ayzenberg Group on Advertising Videogames

Billed as an insiders forum on video game advertising, marketing firm the Ayzenberg Group hosted its second annual [a]list summit in Napa, Calif. on August 12th-14th.  Representatives from 28 publishers were on hand to chart the rise of viral video, the death of screenshots, and how social media is the key differentiator.

Representing Pasadena, Calif.-based Ayzenberg was vice president of strategy and client service Steve Fowler and founder Eric Ayzenberg.  They are quick to point out there is a difference between paid media traditional advertising and owned media like an advertiser’s own website and earned media, which includes Facebook, YouTube, Digg.com, and Trip Advisor.

To better understand how such marketing is changing, DFC contributor N. Evan Van Zelfden sat down Fowler, Ayzenberg and a few other prominent attendees, for a discussion of how Ayzenberg advises its clients.  When asked what has changed the business of advertising video games the most, he responds, The emergence of social networks.

“We’re being tasked all the time to figure out ways to build communities.  That includes applications, mini-games, meta-games and entertaining content that can be shared on social portals, such as trailers and viral videos.  The agency then has to build creative ways to buy and plan media around these social networks,” Fowler says.

“The question Fowler hears most often is: How should social media be approached? That s because most executives he talks to are trying to figure it out on the fly,” he explains.

Eric Ayzenberg, who founded the firm in 1993, told DFC he’s now seeing the use of social media in addition to traditional campaigns.  A publisher might push TV and banner ads two weeks before a game launches, and the two weeks after.

“What publishers are doing these days,” explains Ayzenberg, “are funding programs with the understanding they are not going to be marketing a game for just a month ahead of release, but instead for a full year before launch.”

“On the day the game ships, there’s actually a huge audience out there, waiting for the game,” Ayzenberg says.  “They’ve been anticipating it, following it for a year.”

“Social media outlets are less expensive to get a message across yet require much more creative thought,” Fowler adds.  “And using both can be a powerful combination.  You just don’t have enough money to run TV ads for seven months.”

When asked about effects of recession on advertising budgets, Fowler responds bullishly, “We haven’t seen drastic budget cuts on the games that are shipping this year.”

“What has happened, however is publishers delaying game releases, hoping to launch them in an economy that’s much more spend-worthy.”  Fowler notes stiffer competition among advertising agencies as larger groups can no longer rely on automotive or financial sector advertisers, as opposed to the game industry which is relatively intact. Ayzenberg, by contrast, focuses on the game industry, and works regularly with a dozen publishers.

Fowler also notes the disparity between game marketing, and other products.  “A film’s ad budget is drafted by the finance team, based on projected revenues committing between 20 percent and 30 percent of those expected revenues to advanced advertising.  For games, somewhere between five percent and eight percent of projected revenue constitutes the total marketing budget.”

“As an industry, we grossly under-spend when compared to our closest entertainment industry,” Fowler notes.  “He thinks this could change, but adds that the way games are sold is changing, too.”

According to Fowler, in order for the packaged goods that follow a blockbuster model in big box retailers to survive, they’re going to have to spend more on marketing.  “Big publishers like Electronic Arts and Activision-Blizzard already spend more,” he says. “They get it.”

“But everyone is still trying to figure out what the right spend for emerging types of games should be, whether it s an iPhone game, or a virtual world, MMO, or a casual game portal.”

“Something else that’s in flux is the mainstream media itself, and how people use it.  That’s changing the agency business, too.  In the old world, an agency could create a magazine advertisement, or a television spot.  If the client liked it, that was it.  Print didn t have click-throughs to worry about.”

More and more, agencies are being held responsible for the success of the creative programs they build something game marketers describe as both liberating and scary, at the same time.

“You get instant feedback,” Fowler says.  “Now, a publisher can do a banner campaign, and look at the pre-order numbers.  Did it work   Did it not work   I think from a publisher’s standpoint, it’s pretty powerful.”

“When asked about the possibility of publishers reducing their ad spend,” Fowler responds: “I think it would be tragic. I think you would automatically see the result.  There are just too many titles out there to rely on word of mouth,” he explains.

Ayzenberg works on around a 100 games in a given year as a whole, the industry sees the release of more than 1,000 games each year.

“A game like Beyond Good and Evil might have rave reviews, but without a solid marketing campaign, it simply won’t sell,” Fowler laments.  “It’s very easy for that to happen to great product.”

Fowler has found the greatest marketing successes always come from the closest partnerships.  He has found it is vitally important to have the agency’s and the publisher’s marketing department do the demographics and positioning jointly.  Getting to the depth of product through having early builds of the game itself here at the agency, is also good.  Fowler uses Capcom’s Resident Evil 5 campaign (RE5) as an example.

Having our creatives sit down with the builds, play through the game, really understand what makes it different, unique.   Ayzenberg also had good access to the development team, making use of daily conference calls to Japan, Fowler relates.  “The more entrenched we are with the marketing division, and the developer division of the product we re launching, the more successful we ve been.”

Capcom director of brand management Mike Webster, and director of community and public relations Chris Kramer, attended the summit and were quick to agree that the long-term campaign leading up to the launch of Resident Evil 5 was very successful.

As a series, Resident Evil has sold over 40 million units worldwide. Capcom had the benefit of an existing fan base.  “For us, it was how do we leverage that existing fan base for Resident Evil 5,” Webster recalls.

With an original objective of selling 4.5 million units worldwide, the RE5 marketing team wanted to know how to create and maintain the proper message, and worked with Ayzenberg to develop the campaign.  To market the game, Kramer explains the decision was made to do something more interesting and creative than with past incarnations of the franchise.  That led to the creation of a series of viral videos, known as the flash-forward campaign.  The videos showed the lives of the protagonists, haunted after the events in Resident Evil 5’s story line, and was presented on a custom website named after the game s fictional location: Kijuju.

The top sharers of Kijuju content were then tracked across a variety of platforms such as Facebook, Google, and MySpace.  These top sharers were eventually listed in the game’s manual as Kijuju survivors.

As the distinctive Kijuju graffiti used on the web site became more popular, the sales and licensing departments got excited about using it beyond brand identity in viral videos and websites.

The techniques employed seem to have paid off: metrics report that followed its E3 2008 showing, indicated the game was the most anticipated title of the first quarter.  RE5 launched in March of 2009.  From January to October of 2008, GameTrax shows Resident Evil 5 received 47.8 million page views for the Xbox 360 version, and 43.2 million for the Playstation 3 version.

The next most anticipated title, the PS3 exclusive Killzone 2, only received 26.1 million page views during that same January-to-October period.  Most importantly RE5 had sold 5 million units worldwide by June of 2009.  Capcom estimates they increased the Resident Evil fan-base by 1.5 million people as a result of the long-term campaign.

N. Evan Van Zelfden has covered the international business of games for The Economist, Reuters, and Condé Nast Portfolio.

DFC Intelligence is a strategic market research and consulting firm that has covered the videogame industry since 1995.  To receive DFC Intelligence reports please visit the DFC Dossier sign-up page.

Ad Age Viral Video Chart For Week Of Oct. 5

Abbey Klaassen’s weekly chart lists the top 10 viral videos from last week, with number of views for the week and percentage change in views for videos that stayed on the chart.  The list is compiled by Visible Measures.

There’s a forehead slapper in this week’s chart.  Klaassen points out that this week s new entry, Verizon’s Apple-jabbing There’s a Map for That ad, went viral only after someone put it out as a homemade video.  It could be Verizon underestimated the target market for iPhone-bashing, currently made up of at least 291,244 avid online video watchers.  Klaassen wonders if a user video going viral versus having an official one put out by Verizon adds authenticity.

Microsoft’s Project Natal is still hanging in there, down a couple notches to fourth place with more than 486,000 views this week.

Check out the full list and watch the videos at Ad Age {link no longer active}.

Wrestling Game TV Spot Ends Weirdly

The TV spot for THQ’s WWE SmackDown vs. Raw 2010 highlights a single game feature, the ability to create custom characters.  It sets up a great premise for it.  A mother wakes up to find crazily costumed wrestlers in her kitchen.  She takes it up with her son, who created them for his wrestling game.  They have angry exchanges.  It ends with the mother cuddling in the arms of one of the wrestlers as her husband bangs on the house.  Nothing given away here, it’s a random attempt to punctuate the ad with a laugh.  AdFreak calls it weird.

Watch it at AdFreak.

Edge-Online Charts UK Internet Buzz

Edge-Online launched a nifty feature earlier this week.  The outlet is partnered with marketing metrics firm Brandwatch to chart online buzz for top UK games on a weekly basis.  Edge will feature the list and stats for top ten games for each week along with a weekly topical spin, for example pinpointing a single game genre or franchise.

The data in this week’s chart was published by Edge on Monday and refers to last week s games and numbers.  The index ranks games based on positive mentions, not total mentions.  Not surprisingly, EA’s FIFA 10 stormed Europe and Brandwatch s list last week, topping all UK games in mentions and positive comments.  Halo3: ODST  came in at second in mentions, but scored low with a little more than a third of them being positive.  Gran Turismo for PSP and Mario Kart for Wii suffered the lowest percentage of positive comments on the list of top 10, each at 12 percent.

Edge s topical index for the week looks at music games, essentially charting the Rock Band vs. Hero battle between MTV and Activision’s titles.  This being a UK chart, Singstar is in the mix.

Read more at Edge-Online {link no longer active}.

Make It A Productive Friday

Writing for iMedia Connection, Reid Carr covers the top ten ways he thinks marketers waste their time.  For the most part, he pinpoints the pitfalls many marketers create for themselves in the quest to save money.  Nearly half the list could fall into that category.  Carr seems to build to that very point, explicitly pegging time suck number nine as chasing anything free to find it only ends up costing time.

Before calling a meeting to go over the piece, note that calling too many meetings makes Carr’s list.

Read more at iMedia Connection.

‘DJ Hero’ Intro Is Pure Eye-Ear Candy

FreeStyle Games, developers of Activision’s upcoming DJ Hero, gave the creators of the game s intro movie at Framestore free reign.  Talking to Gamesindustry.biz, UK-based Framestore says the direction they got amounted to going for hyper-real and crazy and not being tethered to game play.

As you’d expect from an intro for a DJ game, what the fully CG movie lacks in set-up and any sense of narrative, it makes up for with an epic setting giant record needle terrorizes planet along with ear thumping sound and eye watering visuals.  If you find yourself pondering how this could be the DJ planet in the same solar system as Brutal Legend, you’re not alone.

Framsestore has told Gamesindustry.biz that they are so smitten by working with FreeStyle on DJ Hero that they re considering offering their visual effects tools and expertise for game development.

Watch the intro movie at Creativity-Online.

You can read the Framestore interview at Gamesindustry.biz.

Wii Fits Into A Working Mom’s Day

Nintendo’s TV spot for Wii Fit aims to show how the Wii can fit into the daily life and busy schedule of a working mom.  The ad follows a working mother to show the many settings and chores she faces from morning to night.  It communicates that cleanly using a moving set technique, where the camera looks as if it’s dollying to follow her as she moves from set to set.  Her hurried day is punctuated by two serene moments in the spot, both of which involve a Wii.  She sneaks in a Wii Fit workout in the morning, and at the blissful end to her day her daughter is busy playing away on Wii.

Watch it at Creativity-Online.

FAQ On FTC Endorsement Guidelines

Ad Age has put together a question and answer list to bring clarification to FTC rule changes governing product endorsements.  FTC changes to its guidelines, the first in 30 years, have been the topic of confused debate.

The changes were announced this month and take effect December 1.  They add new guidelines to FTC’s Guides Concerning the Use of Endorsements and Testimonials in Advertising to reflect the growing use of consumer advocates and product endorsements by individuals through the internet.  The FTC announcement and rule changes were previously outlined in [a]list daily.

Based on media coverage since, marketers are struggling to understand compliance rules as they roll out their holiday campaigns, not to mention sweating the looming deadline.  Ad Age’s handy FAQ outlines the basic facts.

Read more at Ad Age {link no longer active}.

Did EA Buy Social Game Developer Playfish?

There is a rumor that EA has quietly bought social game maker Playfish for $250 million.  Yahoo Finance reported the rumor, putting the price tag on EA s acquisition and quoting a source as saying Playfish was expecting profits of $75 million this year.  While media coverage has spread to game press outlets, there is no confirmation from EA at the time of this post.

UK based Playfish has a reputation among social game developers for thoughtful development and hit games.  In a company profile on TechCrunch in July, Playfish was said to be profitable and sitting on a $17 million cash infusion.  TechCrunch also said every one of its games have made the Facebook top 10 list.  Among popular Playfish games are Pet Society, Restaurant City, and Country Story.

Writing for Gamasutra, Leigh Alexander talks to analysts to ponder EA’s angle in going after a social gaming acquisition, and specifically why it might have gone after Playfish.  In the article, Playfish claims 50 million active users playing 1 billion sessions per month across their slate of nine game titles.

Read more at Gamasutra {link no longer active}.