Virginie Chesnais serves as the chief marketing officer at Happydemics, a platform that specializes in ad‑tech analytics. For many years, gamers have approached in‑game advertising with suspicion, and that wariness is understandable. The reputation of ads in video games is mixed at best; players often encounter redirects to unrelated websites or apps, misleading content, or close buttons that are difficult to locate, all of which contribute to a frustrating experience. A recent study conducted by eMarketer highlighted that 52 % of gamers would abandon a session if they ran into multiple intrusive ad elements.
Losing half of your audience at the very moment you are trying to engage them is far from an optimal strategy. However, advertisements do not have to be a negative force. The same research revealed that one in five gamers would actually increase the frequency with which they play a title if the in‑game ads were of high quality and relevance.
With Xbox currently piloting an ad‑supported game‑streaming service amid a backdrop of steadily climbing costs for gaming, there is a genuine opportunity for well‑crafted ads to find a receptive home within the medium. The argument for introducing an advertising‑based model to games is more compelling than many assume, especially when we look at the success of linear media platforms.
Services such as Netflix, Disney+, and other streaming giants have demonstrated that offering an ad‑supported tier can generate a substantial revenue stream while still delivering a consistent product. If Xbox’s experiment proves viable, it could not only preserve its subscription base but also unlock a completely new source of income at a moment when the brand is seeking fresh financial avenues. The significance of this development lies in the fact that console gaming is increasingly positioning itself as a premium service.
Prices for games, consoles, accessories, and downloadable content have risen to levels that many casual players find difficult to justify, effectively erecting a barrier to entry. Xbox itself has acknowledged that, when executed correctly, advertising can help lower the cost of accessing games. The mobile gaming sector already offers a clear precedent: ad‑supported tiers allow players to engage with titles without the need for large upfront purchases, broadening the market and encouraging wider adoption.
Crucially, any advertising model Xbox adopts would be optional. Players who prefer an uninterrupted experience could continue to pay a subscription fee to avoid ads, while those who are open to watching a short commercial could enjoy a reduced‑cost or even free pathway to the same content. By providing a two‑tier system, Xbox aims to retain its loyal fan base while simultaneously making games more approachable for newcomers. Although no concrete survey data exists yet regarding this specific rollout, it is reasonable to predict that a large majority of gamers would tolerate a 30‑second advertisement if it granted them an hour of playtime on a favorite or new title.
Happydemics’ analysis of 285 in‑game campaigns across the United Kingdom and North America shows that in‑game advertising consistently outperforms TV, social, and other online formats in terms of ad recall and accurate brand attribution. In other words, players are more likely to remember an ad they see while gaming and correctly associate it with the sponsoring brand.
Xbox’s “around‑the‑game” approach—delivering ads before the gameplay begins rather than embedding them within the game world—adds another layer of intrigue. Our data indicate that these pre‑game placements generate even higher recall and attribution scores compared with traditional in‑game placements.
This distinction matters because, while we may notice advertisements while watching television or scrolling through social feeds, those impressions do not always translate into a clear link to the advertised brand. Gaming, by contrast, appears to operate in its own league when it comes to creating strong, memorable brand connections, which likely explains why companies like Xbox and EA are increasingly exploring ad‑based gaming models. It is important to note that Xbox’s ads will not interrupt the actual gameplay; they will appear before the game starts. In‑game ad formats tend to excel further down the conversion funnel, delivering stronger lifts in brand image, consideration, interest, and overall likability.
A hybrid strategy that combines both pre‑game and in‑game ads could, theoretically, provide advertisers with the best of both worlds, though it also raises the risk of player pushback if the balance tips too far toward intrusion. Xbox has pledged that any ads it introduces will be non‑intrusive, a claim that makes sense when the ads are displayed prior to the gaming session. This timing ensures that the immersive experience remains untouched, a factor that matters not only to players but also to advertisers who want their messages to be part of the experience rather than a disruption.
Relevance will be key. No gamer wants to see an advertisement for cat food when they don’t own a cat, or for a game they have already completed. By delivering contextual, well‑targeted ads, Xbox can keep players from abandoning the session while simultaneously giving brands an effective platform to reach fresh audiences. Nevertheless, Xbox is venturing into largely uncharted territory.
The company must gauge how players will react to pre‑game ads and determine whether the revenue generated will justify making this model a permanent fixture. The move toward ad‑supported game streaming reflects a bold, risk‑taking mindset from Xbox CEO Asha Sharma, but only time will reveal whether the strategy pays off. Historically, many of our gaming‑ad initiatives have revolved around “watch an ad, earn an extra life” mechanics.
Xbox’s proposal is different: it asks players to watch an ad to access a game they already own. Our existing data set does not yet provide clear insight into how this will be received.
However, broader research on ad format perception shows that descriptors such as “non‑intrusive” and “immersive” consistently rank among the most positively received attributes. If Xbox—and potentially other platforms—aim to make advertising a lasting component of gaming, they will need to prioritize these qualities. In my view, Xbox will neither be the first nor the last company to experiment with this approach. Advertising has been part of gaming for many years, but it has rarely been implemented with the player’s experience at the forefront.
Should Xbox succeed in striking the right balance, it could pave the way for other developers and publishers to adopt similar models, ultimately making video games more affordable and accessible for the everyday gamer.