As covered in our special focus interviews, location-based games are one of the hottest areas of the business.
There's not been a similar focus with innovation with respect to location-based advertising for games, however.
With the exception of PressOK's PlacePlay service, the options are fairly generic advertising solutions.
But that's something US location platform CloudMade is looking to change.
Right place, right time
It's already a sizeable outfit in the space.
Integrated around the OpenStreetMap wiki map, it offers its geo-platform and tools to over 16,500 developers on Android and iOS. It's also used by companies ranging from watches to automotive.
Now, with its Sponsored Locations service, it's looking to tap into the synergies between games and location.
"We've been a little slow in terms of getting into games, but when we started looking at the sector a year ago, we realised there was a big opportunity," says Christian Petersen, VP of community.
The issue is that previously, location had often been used to restrict advertising campaigns, rather than expand the audience. In this way, it's not yet proved good at driving foot traffic to brick-and-mortar retailers - a vital metric in an environment of increasing competition from online sales.
"Not even Foursquare has enough scale. And you need an experience people enjoy. People generally don't like location-based ads," says Petersen, of the generic solutions.
"Games are probably the only thing that can do this," he adds, referring to scale and the user experience.
Virtual exchange for map position
In terms of how CloudMade came up with Sponsored Locations, it spoke to large retail brands and mobile developers to find out what the perfect overlap would be.
The result is a service that when integrated into games, enables retailers to sponsor virtual items, levels or content that's already in the games. The trick is players have to go to the retailers to unlock the items.
Once they are there, in-store offers can be displayed, but this isn't the main focus.
"Typically less than 2 percent of players of free-to-play games spend money on in-app purchases, so this is a way of monetising the 98 percent," Petersen says.
Go wide, go fast
It's a smart system because it means retailers can easily and quickly gain the scale they require across multiple games because they're not sponsoring bespoke items.
Obviously, this approach also makes it easier for developers and publishers to support.
"We need to be a scalable as possible," Petersen explains.
"Retailers need as broad a response as possible across multiple games; they're looking for two or three digit million players."
CloudMade is already in talks with what it describes as two large publishers and the service will launch in April in North America on iOS, with the Android SDK available in Q2.
It hopes Sponsored Locations will be in 30 titles by the end of the year, with Asia and European campaigns also in place.
In time, there will be the opportunity to integrate deeper, with games taking advantage of real-time options such as time of day and weather as well.
"The bottomline for developers is that they're interested in monetisation and user retention, and location is important for both of these," Petersen ends.
You can find out more about Sponsored Locations via the CloudMade website.
Interview
Contributing Editor
A Pocket Gamer co-founder, Jon is Contributing Editor at PG.biz which means he acts like a slightly confused uncle who's forgotten where he's left his glasses. As well as letters and cameras, he likes imaginary numbers and legumes.
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