Leveraging the Power of Gaming World through Promotions

 

It takes only a quick scan of the long list of magazines and blogs devoted to video games to understand the power that the gaming industry wields.

 

According to consulting firm Pricewaterhouse, the size of the U.S. gaming market is set to exceed the music market this year; and the global gaming market is on track to be worth $48.9 billion by the year 2011. With statistics like this þu along with a 2007 report by MSN Money stating that half of all Americans between the age of 12 and 55 now play video games þu the opportunities to leverage gaming content through promotions are immense. Yet few video game companies have implemented a promotions strategy that enables them to fully leverage either their game content or their fan base.

 

Digital media is a natural extension to the gaming industry and gives gaming companies a powerful way to both expand their product offerings and become major players in the promotions market. By turning licensed game content into music downloads and mobile content and making it available for promotional campaigns, gaming companies have a powerful way to drive game sales, secure free mass advertising and generate significant incremental revenue. On the flip side, licensed game content serves as a valuable marketing tool for brands and retailers interested in connecting with key demographics by tapping into the gaming craze.

 

Promotional Opportunities for Gaming Companies

When it comes to a healthy bottom line, having a retail strategy is only half the equation for savvy game companies. In order to fully capitalize on the financial opportunities available, adopting a comprehensive promotional strategy is a must. By leveraging their licensed game content for promotional purposes, gaming companies can significantly boost retail sales and, at the same time, open the door to a lucrative new revenue stream.

 

 

There are three key ways gaming companies can leverage their content through promotions:

 

1. Drive Game Sales through Self Promos. While the concept is still new, some video game companies have already discovered the power of using digital incentives to motivate consumers to act. To help drive pre-launch sales of video games, both Capcom and Eidos have launched music download promotions in which consumers who pre-purchased a game were rewarded with a branded music card good for free music downloads featuring music from the game. Recently, Eidos carried this concept to an exclusive in-pack promotion at Wal-Mart in which Wal-Mart consumers who purchased the much anticipated Kane and Lynch: Dead Men action game were rewarded with a promo code good for $10 worth of exclusive ringtones or wallpaper from the game. In all cases, the promotions were a huge success.
2. Secure Free Mass Advertising through Brand Promotions. Because of the enormous market penetration video games enjoy, licensed game content from popular video game series can serve as a powerful marketing tool for the right brand or retailer. This, in turn, can result in free mass advertising that helps promote an upcoming game release. The key is finding the right brand or business to partner with. Brands have already discovered the power of using digital music from top artists in their promotional campaigns. A recent example of this is the Beyonce/L'Oreal ringtone campaign launched last December at Wal-Mart to promote L¡¯Oreal¡¯s new Infallible lipstick. With the U.S. video game market now surpassing music sales in the U.S. and touting a devoted fan base that spans from tweens to baby boomers, licensed game content is a natural fit for brands and retailers wanting to tap into the video game craze.
3. Generate Significant Incremental Revenue through Sale of Promotional Licensed Content. For the same reasons outlined above, exclusive digital game content can serve as a valuable promotional currency for brands and businesses wanting to connect with the broad video game demographic. By understanding the economics of the promotional sector, gaming companies can drive a significant new revenue stream from selling digital game content for promotional purposes.

Key to Success in Promotions Industry

To be sure, a successful promotional strategy requires a lot of moving parts. Because digital content should be at the heart of any promotional plan for the gaming industry, teaming up with the right digital mobile and music portals is a critical first step.

 

Gaming companies need to identify which licensed game content makes sense for the promotional market, and then work with providers that can turn that content into digital entertainment, ingest it into their online portals, and facilitate the delivery to consumers nationwide. If the promotional plan calls for third-party brand involvement, it requires understanding the economics of promotions and the constraints of promotional budgets, and then designing a promotional pricing model that represents a win/win for both the video game company and the brand. It also requires understanding the lead time requirements for promotional campaigns, and knowing how to time campaigns so that they give both the brand sponsor and the video game company the biggest bang possible.

 

Next are the administration and logistic components of a promotion that are inherent whether it is a self promo or a brand partnership. There are numerous elements to consider ¨C such as whether the digital content will be delivered via a branded card or printed in-pack, and whether a custom landing page needs to be developed for the online digital portal. There are also code security issues to contend with to safeguard against fraud.

 

Because of everything that is involved in incorporating a successful promotional strategy, it is essential to work with someone who has the proper expertise. But whether partnering with a company such as Promotional Currency to facilitate the promotional solution, or finding someone internally who can take on the role ¨C the message remains the same. Thanks to the soaring popularity of video games and the natural tie in with digital media, video game companies are uniquely positioned to capitalize on the multi-billion promotional industry. Incorporating a comprehensive promotional strategy ensures that video game companies are taking their business game to the next level. Those that don¡¯t will get left behind.

 

About the Author

Barry Schaffer is president of Promotional Currency, a digital promotions firm that specializes in the development and implementation of new digital currencies for the promotional market. Since founding the company in 2004, Schaffer has facilitated over 900 digital entertainment promotions for brands and retailers. He has also helped content owners and providers to more fully monetize their licensed content by turning it into digital media and taking it out to the promotional market.

 

A seasoned veteran of the promotional industry, Schaffer has spent the past 20 years working to elevate promotions through the use of digital promotional currencies and fixed priced strategies. Prior to founding Promotional Currency, Schaffer served as Vice President/General Manager for SCA Promotions, the world¡¯s leading provider of promotional risk. While at SCA, Schaffer launched the company¡¯s telecard division (which represented the first digital currency in the promotional marketplace) and built it into a multi-million dollar enterprise by helping clients grow their businesses through the delivery of high-impact promotions at a fixed cost. He can be reached at b.schaffer@promotionalcurrency.comThis e-mail address is being protected from spam bots, you need JavaScript enabled to view it