Is in-game advertising the future of fashion?

In much the same way that fashion is seen as an extension of our identity in the real world, character customisation provides an opportunity for self-expression in the virtual world. From the hugely popular online game platform and game creation system Roblox to Epic Games-owned Fortnite and sandbox favourite Minecraft, the personalisation of digital avatars remains an important feature across the board. And it makes sense when you consider that, according to a report by Roblox, 56% of Gen Z say that dressing up their avatar is more important than their physical style, and 84% say their fashion is inspired by the way they dress in a game. There’s an evident need for fashion as a tool for self-expression and creative exploration in the virtual world, and fashion houses are just beginning to tap into it.

When we consider that there are 3.2 billion gamers worldwide (Academy of Animated Art), it’s easy to see the potential for branding opportunities, yet harder to understand why this market remains largely untapped. In 2022, eMarketer reported that the U.S. had invested US$56.9 billion in social ads, US$67.2 billion in video ads, and US$68.4 billion in TV ads, yet only US$8.6 billion in video game advertising. Meanwhile, research shows that in recent years, fashion enthusiasts have developed a clear interest in gaming. A study of US gamers by Anzu, an in-game advertising agency, found that 76% followed fashion brands and influencers, and 66% were consumers of luxury branded products. In a study by The Interactive Advertising Bureau (IAB), half of agency respondents said brands are more comfortable with traditional media such as television advertising than newer avenues like in-game advertising. Brands offered another perspective, with one-third stating that agencies weren’t pushing them to invest in in-game advertising (Adexchanger).

A handful of notable frontrunners have already taken the plunge and invested in in-game advertising and/or digital fashion collections, including Gucci, Nike, Balenciaga, MISBHV, Burberry, Louis Vuitton, Coach, [A target='_self' link='https://dd.agency/projects/tommy-hilfiger']Tommy Hilfiger[/A], Prada, and French conglomerate LVMH. By collaborating with virtual environments that align with their own narratives and collection stories, a powerful opportunity for brand exposure presents itself. Take the example of Polish fashion house MISBHV, who crafted a digital collection of streetwear for the action-adventure game Grand Theft Auto V. The virtual fashion line included hoodies and tees worn by the in-game German DJ group Keinemusik, perfectly encapsulating MISBHV’s own brand story and gaining exposure with an aligned and highly receptive audience. The collection extended itself to the real world too, with MISBHV working closely with Keinemusik to craft a physical collection that rang true to all parties involved.

In-game advertising provides fashion brands with a unique opportunity to broaden their reach and foster brand loyalty among a highly engaged audience. Not only do these ads boost visibility, but they also offer valuable insights through a range of marketing metrics that can be tracked in real time. Key indicators such as brand exposure, enhanced by constant visibility within games, play a crucial role in improving brand recall. Metrics like impressions, clicks, and interactions give brands immediate feedback on how their campaigns are performing, while conversion rates, including website visits and purchases, help measure the overall impact of in-game ads.

The convergence of fashion and gaming isn’t slowing down any time soon. As the boundaries between virtual and physical realities blur, the opportunities for fashion brands are expanding rapidly. And despite some initial hesitation, brands are recognising the immense potential of this evolving industry. While it’s still a new concept for many, the success of other fashion houses’ virtual campaigns is inspiring others to invest in this burgeoning realm of growth, creativity, and innovation. While a slow transition, the expectation is that game advancements will further simplify advertising across gaming ecosystems and eventually lead to in-game advertising as a popular advertising avenue.