“1 in every 2 gamers will attempt a new game after seeing its ad on OTT platforms”

The ZEE5 Intelligence Monitor’s report on the gaming industry has some great insights and interesting findings worth pondering over. For example, the report states that non-metros are emerging as a hotbed for online gaming, with 63% of the non-metro users playing games at least 5 times a week.

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Another interesting finding is that virtual reality is currently the most popular genre in gaming. “We are seeing an increasing number of individuals being able to enjoy virtual reality games in the privacy of their own homes. In 2022, non-fungible tokens (NFT) will be another major trend to follow,” says Rajiv Bakshi, Chief Operations Officer, Revenue, Zee Entertainment Enterprises Limited (ZEEL), in this interview with Adgully.

He notes that there is a substantial shift in revenue models adopted by gaming platforms – from relying on their earlier free-to-play model with interstitial or in-game advertising as a revenue source to freemium and hybrid monetisation models like in-app purchases or IAPs. “Our survey also highlights that two out of every five gamers are willing to pay for an in-app purchase to advance in a game, or for an ad-free gaming experience,” he adds.

Excerpts from the interview:

What are the key insights from your e-gaming report? How has the audience matured, and the industry evolved?

The ZEE5 Intelligence Monitor’s report on the gaming industry has unearthed some interesting insights and findings. The report reveals that almost 60% of the respondents play online games; this number surged dramatically during the pandemic-induced lockdown, when people were forced to stay home and find new ways of entertainment, connecting with their family and friends, for which playing games together came out as a widely adopted option.

We also noticed an almost equal split between gaming adoption in males and females, where 57% of female respondents and 60% of male respondents were said to be actively playing online games. This goes against the common gender-based stereotype that gaming is for boys and men; however, female participation in gaming has begun to rise, enough to match their male counterparts. While online fantasy sports and multiplayer/ first-person shooter games were preferred by 72% of male users, 46% of female users were keener on casual games.

The gaming industry has grown exponentially in the last few years, and its growth has been catalysed by key factors such as increased Internet penetration, smartphone affordability and usage, and the rise of digital payments. In fact, the findings also reveal that non-metros are emerging as a hotbed for online gaming, with 63% of non-metro users playing games at least 5 times a week. 39% of the respondents played for more than an hour and 40% of the users are likely to make in-app purchases. In terms of genre, 39% of the users across non-metros showed a preference towards fantasy sports games. This set of consumers was always ambitious and aspirational, perhaps even more so than their metropolitan counterparts, but access and price were often limiting factors. However, mobile and Internet revolutions have now shattered those barriers, and the widespread adoption of online gaming is a sign of its widespread reach.

With nearly 433 million gamers, India is the world’s second-largest online gaming market. However, it has one of the lowest ARPU. How can the challenge of monetisation be addressed? Will more monetisation models emerge?

While the Indian gaming sector has seen considerable growth in all major engagement indicators as well as the total number of players, monetisation still remains a subject of focus, since we are low on ARPUs compared to major countries. However, with online gaming becoming a more widespread recreational activity and users getting familiar with digital payments, the tide of monetisation for gaming platforms has begun to turn in.

We are seeing a substantial shift in revenue models adopted by gaming platforms – from relying on their earlier free-to-play model with interstitial or in-game advertising as a revenue source to freemium and hybrid monetisation models like in-app purchases or IAPs. Our survey also highlights that two out of every five gamers are willing to pay for an in-app purchase to advance in a game, or for an ad-free gaming experience. However, from a monetisation standpoint, we are still in the early stages, and platforms that invest in trust-building aspects that enhance the overall user experience are likely to see improved retention and increased monetisation in the future. Trust and the entire user experience will likely become major differentiators as gaming platforms explore for methods to boost monetisation and customers open up to the idea of paying real money for gaming.

What are the innovative concepts and hot trends in the gaming field such as social/ interactive gaming, etc.?

Virtual reality is currently the most popular genre in gaming. We are seeing an increasing number of individuals being able to enjoy virtual reality games in the privacy of their own homes. In 2022, non-fungible tokens (NFT) will be another major trend to follow. Video games are the finest application for NFTs; skin customisation, virtual avatars, in-game items/ rewards, and so on all exist in video games, the metaverse, as we call it now, and are being transformed into NFTs. Live streaming and esports have been key drivers for the growth of video games, and content creators and/or IP holders will eventually look to convert the best of gameplays/ streaks/ moments into NFTs, which will not only help increase monetisation for content creators, video game developers, and others, but will also act as a catalyst in terms of fan and user retention.

We will see an increase in Esports events and team IPs as a result of numerous entrepreneurs and organisations focusing on gaming and esports. In the future years, the audience will continue to diversify. As a result, rather than a male/ female audience bias, we are likely to see an equal gender split across all formats, not just casual games.

Are brands exploiting the full potential of the online gaming industry? Is it the next big medium for brands? What are your insights on this?

The online gaming industry has immense potential for growth and a bright future when it comes to brands realising its importance and pumping up their investments to advertise more on gaming platforms. That’s the exact reason why we decided to get a deeper understanding of the changes that are influencing the landscape and conducted this survey amongst the ZEE5 audience to gauge their habits and preferences pertaining to online gaming. The survey reveals existing and imminent outcomes, which would shape the future of India’s online gaming landscape in the coming years. It’s still a growing market, especially when it comes to brands exploiting its full potential to advertise and target their respective audiences. Advertisers now have a new way to target clients based on their specific interests and habits thanks to the fast-paced gaming universe.

Gaming is among the finest mediums for digital marketing for advertisers who want a larger and a long-term brand exposure to a climate where consumer behaviour is constantly changing. Besides that, the online gaming sector creates a wealth of data that allows advertisers to target relevant audiences and maximise return on investment using precision targeting based on age, gender, geography, device, language, and interest categories, all of which lead to increased ROI. Advertisers can also use real-time data and analytics to improve the performance of ongoing campaigns. With games becoming more ubiquitous on a daily basis, forward-thinking businesses have already taken the first steps to realising and making the most of their potential in order to advertise and promote their brands. In a post-pandemic world, brands and advertisers must boldly rethink marketing techniques to react to shifts in customer behaviour.

Given the synergy between online gaming and the consumption of entertainment content, what are the opportunities for gaming brands to partner with OTT platforms?

Traditionally, entertainment platforms enjoy tremendous equity and wield a heavy influence among consumers. Furthermore, the emergence of OTT platforms that provide on-demand access to regional language content has deepened this link, resulting in a sense of familiarity and trust. As a result, it is no surprise that 1 in every 2 gamers will attempt a new game after seeing an advertisement of the same on OTT platforms. As we peel back the layers of this phenomenon, one prominent element that emerges is the level of viewer engagement that OTT platforms and personalities enjoy, having a much deeper relationship with audiences since they engage with them on a daily and more frequent basis. This is especially important for gaming platforms as they try to attract new users and earn their trust.

Another benefit that OTT platforms provide gaming brands is access to a screened audience and a data-rich environment with a wealth of actionable insights into user behaviour, aspirations, and preferences broken down by demographics, geographies, and cohorts. Furthermore, because OTT platforms are digital-first, they provide opportunities for a two-way contact and real-time engagement, which can assist gaming companies innovate and improve their monetisation efforts. Because of the cognitive space that both entertainment and gaming occupy among customers, they have a symbiotic relationship. We may also expect intriguing collaborations and crossover advances in the field as the gaming business evolves and gamers open up to new and inventive concepts.

Gaming companies involving real money cannot advertise due to regulatory issues. How are such regulatory restrictions impeding the growth of the Indian gaming sector?

The gaming sector has a bright future. It is a sunrise industry and has the potential to considerably boost India’s employment, entertainment and GDP. Like any other new industry, it will go through its journey of policy development, all directed for its long-term growth.