Dasha Arzhanik, Influencer Marketing and Product Director at HypeFactory, outlines key shifts in the game industry. The focus is moving beyond performance metrics, with game companies emphasizing brand building and deeper audience connections through brandformance (A term coined from “branding” and “performance,” it refers to marketing efforts that combine branding and performance objectives.) campaigns. The research dives into new demands and habits of audiences, integration and medium opportunities, collaborations, and even community-building fundamentals.
General trend – increasing demand from gaming companies for brandformance campaigns and a growing emphasis on the Cost-Per-Action (CPA) model for promotions. The focus is slightly moving from solely oriented on performance metrics toward building a brand for a game, fostering deeper immersion, and establishing stronger connections with the audience.
- New audiences
The gaming market is becoming oversaturated. Considering the slowdown of the growth in key markets (North America and Asia-Pacific), gaming companies can expand to new audiences thanks to the new emerging segments: females and families.
The online gaming reach among female gamers is growing at an unprecedented rate of 33% annually.
According to PlayToday, 37% of gamers in Asia are women. This figure is growing at a rate of 11% per year. Female gamers comprise about 23.5% of the Asian games market’s total revenue.
As female gamers emerge as a powerful force, gaming companies must swiftly adapt to embrace this new and highly valuable demographic. Industry leaders recognize that agile companies who do cater to female gamers will outpace legacy businesses with a sole focus on male players.
Families (teens + older adults)
Mobile gaming is now attracting all ages, particularly in Western markets. In the US, games appealing to Gen X and Baby Boomers (45+) make up nearly 25% of top-grossing games in 2021, a 6% increase from 2019.
The percentage of players 55 and older is higher than that between the ages of 45 and 55. Nearly one-third of people over the age of 65, in fact, said they play games regularly. “Video games remain a mainstay in American households, as they have for decades,” said Stanley Pierre-Louis, president and CEO of the ESA, in a statement. “Playing video games has become the norm, as those who first learned to play on early consoles now share their joy of play with their own children and grandchildren.”
- New types of integrations
We notice the trend of gaming companies being more involved in the production of dedicated creatives that correspond to the influencers’ style.
Following the global marketing trend of community building, the growth of gaming streams doesn’t come as a surprise, considering the live interaction between a streamer and its audience. Streaming’s audience will exceed one billion people in 2023, increasing with a CAGR of +16.3% from 2020 to reach 1.4 billion in 2025.
Twitch, the leading platform, reached 140 million monthly active users (MAUs) and 31 million daily active users (DAUs) in January 2023.
While streaming growth has slowed, viewership is still up 6% from its COVID-19 pandemic peak in 2020 and 164% higher than in 2018. Live streaming slightly decreased in 2022, but Twitch was the least affected, dropping only 6% YoY and keeping its leadership position. Facebook Gaming was hit the hardest in 2022, dropping 56% YoY from 2021. While YouTube Gaming has also seen a decrease in hours watched, it has since pulled away from Facebook as the definitive second most-utilized live-streaming platform in the West.
- New geos
Briefly, there are 2 main tendencies:
- MENA and LATAM show the fastest growth for market value and number of users. Nevertheless, the market value is still significantly lower than in North America or Asia-Pacific.
- Asia-Pacific is still a leader in terms of market value and user spending on video games, but this region demonstrates the slowest growth due to new privacy regulations impacting gaming in China.
Every region is experiencing growth in 2023, with the US and China accounting for 49% (nearly half!) of all consumer spending on games. While the Middle East & Africa market only accounts for a 4% share of total revenues globally, it’s showing the most impressive growth (+6.9% year-on-year).
Interestingly enough, Asia-Pacific accounts for a whopping 46% of the pie, but growth is minimal at +1.2% year-on-year. This doesn’t detract from the region being a spending powerhouse for the global games market. Instead, it points to several trends, including new privacy regulations impacting mobile gaming — mostly due to the transformative impact of lockdowns and restrictions on minors’ gaming time. While more games are receiving licenses in the market, the ripple effect of the previous freezes and slow license issuing are echoing throughout China’s games market. At the same time, the termination of NetEase’s collaboration with Activision-Blizzard for publishing Blizzard’s PC games locally will adversely impact PC game revenues in China.
The less mature markets of the Middle East & Africa (+12.3% year-on-year player growth) and Latin America (+6.1%) will enjoy the most player growth in 2023. Factors driving this growth include:
- better (mobile) internet infrastructure
- accessible and affordable (mobile) internet
- rise of the middle class
- availability of gaming as an affordable recreational activity, thanks to the free-to-play model
- increasing population of smartphone users
- New platform for live streaming
Controversial new sponsorship rules—though retracted—open doors for competition among live-streaming platforms (Twitch regulations paved the way for Kick to grow).
Kick made its dazzling debut in 2023. Through its statistics, we’ve been closely monitoring its impressive evolution and expansion throughout the year.
The platform is quickly becoming a major force in the live-streaming industry.
Kick signed many large names in the content creation communities to come live-stream on their platform, and in September 2023, the platform recorded its first 100M hours of watch time in one month, setting a new record by the metric.
Kick is not developing as a Twitch-Killer but rather a live-streaming platform that offers audiences and fans different experiences, categories, and streamers to follow.
If Kick continues to develop its international audience and support regions outside of North America, it could develop into one of the largest live-streaming platforms in the world. Let’s keep an eye on all things related to Kick.
- Community Building
Game viewing has now become a pivotal factor in enhancing game engagement and nurturing communities. Players turn to game content to refine their skills, gain insights on conquering challenging levels, witness the expertise of top gamers, and much more.
Live-streamed gaming content serves as a prominent global gateway to this kind of content. Ultimately, game video content plays a pivotal role in cultivating a community around a game. An actively engaged and passionate community forms the bedrock of any successful game, encompassing devoted followers across platforms.
Many brands erroneously assume that achieving success on social media entirely depends on content creation. However, this is merely one facet of the equation. The other crucial component entails building a community, creating meaningful connections with your audience, and fostering deeper engagement. Brands that proactively establish and sustain these connections with their audience are the ones poised for triumph.
Engage with Comments
One distinguishing feature that elevates live streaming above static videos is the capacity to engage directly with your audience. There’s nothing more crucial than establishing connections with your viewers and nurturing enduring relationships. It’s essential to make your audience feel like active participants in the experience, and that involves attentively monitoring and responding to their comments.
Twitch has added new chat moderation features. Now, streamers can share their comments on viewer bans with partner channels. In this case, moderators from other channels can better understand the context of the ban and take it into account for future interactions with particular users.
Chatbots can be useful for automating tasks such as including links, announcing upcoming events, and answering frequently asked questions. However, they shouldn’t be used as a replacement for human interaction. It’s still good to answer specific questions and give shoutouts to active audience members. People love to get personal attention and hear their names mentioned.
Call to action during live streams
Another way to attract loyal viewers is to hold contests and giveaways. Prizes and swag give people an incentive to return to a stream. People love free stuff. It can be a giveaway or in-game items.
Are unlocked by watching any participating channel for the amount of time set by the game developer to earn a reward. Once a viewer completes the time requirement, will be able to claim the reward. Some Drops rewards will require you to earn and claim a previous reward before a viewer is able to earn progress toward that reward. Source: Twitch
- Everywhere. Any time. Play the game
Cross-Platform Play Convergence
Allows players on one gaming platform (e.g., PlayStation) to play with and against players on another platform (e.g., Xbox or PC).
Games like Fortnite have championed cross-platform gameplay, allowing players on Xbox, PlayStation, PC, and mobile to play together in the same matches.
Impact on Video Games:
Community Unification: Games like “Fortnite”, “Minecraft”, and “Rocket League” have large player bases that aren’t split up by platform, leading to a more vibrant and unified community.
Economic Implications: Developers can potentially reach larger audiences without being confined to a single platform’s user base.
Development Challenges: Cross-platform play requires developers to ensure their games are balanced and offer a consistent experience across platforms, which can be challenging given the hardware differences.
Platform Policies: Not all platform holders were initially open to cross-platform play, but the success and demand for such features in prominent games have caused shifts in policies.
Gaming in cars may be closer than we think
In the past few months, we’ve seen some surprising news about gaming as part of the automotive experience that leads us to believe that this segment is not as farfetched as previously thought.
BMW announced an exciting partnership with AirConsole to offer casual gaming in cars via the cloud back in October. In December, Tesla integrated Steam into its vehicles. Lastly, this January, NVIDIA announced that it was bringing its GeForce NOW cloud gaming service to select Hyundai, BYD, and Polestar electric vehicles.
Altogether, these developments represent an interesting shift toward automotive gaming.
Think about how much idle time comes with cars, especially with electric vehicles that need to charge. This chunk of time is largely unclaimed, and small bursts of gaming could occupy those periods. Allowing people to form a habit of playing high-end games while parked (or as backseat passengers, to be safe) could play an important role in our current engagement-first economy. Social media, short-form videos, and other formats are already vying for idle attention, so why shouldn’t games have a metaphorical seat at the wheel?
Now seems like the perfect moment for this development for two reasons. Firstly, automotive entertainment systems are improving fast, and even if onboard computational abilities are limited, modern cars have data connectivity. Cloud gaming can take care of the heavy computational lifting in this case. Secondly, electric vehicles need to be charged, particularly before embarking on long drives. That’s enough idle time for a round of Fortnite (or several).
- In-Game Collaborations
The collaboration between celebrities and game developers has resulted in unique in-game content, like Travis Scott’s virtual concert in “Fortnite,” which attracted over 12 million viewers.
Collaborating with celebrities and big creators are still widely used by major gaming titles for attracting media attention and buzz, targeting new demographics, building long-term brand associations, event participation and significantly increasing exposure and reach.
- The Rise of VTubers 2023: Virtual Creators in the Streaming Space
VTubers have slowly but surely created a space for themselves in today’s online streaming space. Even though it originated in Japan, it has become a booming business worldwide that brings millions of watch hours for its exponents, with their nationalities varying from America to South Korea to Argentina.
What is the state of the VTuber market?
- There are over 49,500 active VTubers live streaming on Twitch and YouTube Live Gaming! Breaking it down, there are 37.3K channels on Twitch and 12.2K on YouTube Live Gaming.
- VTubers outpace traditional streamers in terms of growth on both Twitch and YouTube Live.
- While VTubers represent a minority of 0.4% of active channels, they make up a higher percentage of viewer hours watched at 5.7%.
- On average, VTubers have higher audience engagement than non-VTubers on Twitch – 48% to 52%.
- VTuber fans are excited to help their favorite streamers grow and generate a huge amount of fan content.
Most-watched and most popular YouTube Gaming streamers in September 2023:
In fourth and sixth place, respectively, were Pekora and Koyori, two VTubers from Japan. Japan is one of the biggest markets for YouTube Gaming, and the red platform is dominated by VTubers from this region. VTubers amass large amounts of watch time during their daily regular broadcasts, and this was enough to earn two well-respected VTubers a spot on this ranking.
What are VTubers’ Top Streamed Categories?
Vtubers are becoming more popular worldwide, dominating the YouTube streaming space. Soon, you’ll probably see more YouTube Vtubers on the homepage.
Influencer Marketing and Product Director, HypeFactory
Dasha leads influencer marketing innovation, launching global performance campaigns for major brands. Specializing in gaming collaborations, she tailors solutions to client objectives, making her team leaders in infomercial campaigns across 20 regions, driven by data-driven decisions.