Could Gaming's 'Epic' Struggles Open the Door for More Advertisers?
Is Roblox the future model?
There was a time when Epic Games seemingly couldn’t do anything wrong, and brands were dying to be part of the phenomenon that is Fortnite - even as they were mostly left on the outside looking in.
Epic didn’t like advertising, and didn’t seem to want much to do with it. The company was sort of the extreme version of an industry that didn’t have much interest in catering to brands.
Things have changed in the gaming space fairly dramatically. Could that open up this world more to advertisers? Or is that just more wishful thinking regarding an ad medium where it feels like we are always waiting for it to happen?
As you may have read, Epic laid off a thousand people a few weeks ago, acknowledging that Fortnite’s audience is down, and that some recent initiatives have not worked. Meanwhile, Fortnite players are grumbling online that the games currency, V-Bucks are worth a lot less (apparently inflation spares no one, even virtual Battle Royales).
This news came amidst a rather gloomy time in gaming, which has been marked by a steady stream of job cuts, and as analyst Matthew Ball put it in his recent annual presentation on the state of gaming, “with budgets cut and layoffs…the video game industry continued its retreat.”
Through my advertising lens, I immediately thought - could a steady stream of ad revenue have stemmed the tide of losses at Epic, and help get the industry through its retreat?
Well, according to some industry insiders, Fortnite’s current problems are about keeping the game fresh and engagement high - while trying to ensure the more people can access the game via mobile devices. Advertising revenue wouldn’t necessarily address those issues.
Ok, but what about the other big gaming companies? Wouldn’t a steady dose of ad revenue come in handy right now if the industry is indeed ‘slumping?’
“I don’t see the big studios like EA, Take-Two, etc. suddenly doing this,” said Amanda Rubin, senior vice president, revenue at Frameplay. “They’ve gone back and forth on advertising for years and they’re still confused.”
Rubin said that that big gaming publishers are often paying to license IP from big brands - sports leagues, movies, etc. - and then turning around and asking them to pay to advertise, setting up a nagging contradiction. In the case of Epic, the company just doesn’t have interest in incorporating standard, scalable ad units.
“It’s hard to say if that would have even helped Epic,” said Michael Herriger, CEO / Co-Founder, Atlas Creative, which helps brands create custom gaming programs.
“You’ve seen it on Roblox, where they’ve proven do all of these things people [in gaming] are afraid to do. You can do it and still grow. Yet with Fortnite, they are very much trying to build something different.
To be fair, while Roblox gets credit for fully embracing ads, ad spending still hasn’t moved the needle at the company, which makes the majority of its revenue through virtual currency. A recent Bloomberg story showed how many Roblox game developers just don’t see the value in running ads. And the company has said it’s going to take a while for ads to hit the bottom line.
“While advertising revenue currently remains modest, our expanded portfolio of ad products, together with our growing age-checked user base makes us bullish about the long-term potential for mass market advertising on Roblox,” said the company in its 2025 annual report.
One advantage that Roblox is touting is that because so many of its games are made by users, and because of advancements in AI-driven technology, the company can simply make games much cheaper than others (think of the years of investment and development required for the next “Grand Theft Auto,” for example).
From Roblox annual letter: “Not long ago, people talked about game development budgets in the billions of dollars and timelines of years. But in September 2025, thanks to the power of the Roblox platform, Steal a Brainrot, a game launched in 4 months by a group of young developers, reached an all-time record of 25 million concurrent users. We believe our AI roadmap will create more opportunities for this kind of success.”
With that kind of seemingly overnight, outsourced success, why be precious about rolling out ads?
“Roblox's ad trajectory has been steady but relatively modest to date, but the company has been experimenting with a variety of ways to scale this business,” said Stephen Dypiangco, head of Max Power Gaming. “If Roblox is able to crack rewarded video ads, I believe larger gaming companies will take notice and explore adopting advertising similarly.”
Whether Roblox is the right model or not, “there is still plenty of room to embrace ads in games,” said Herriger. As Ball put it, “Today, ads remain rare among PC and console games and services, but eventually ads reach all addressable surface areas.” In other words, everything is an ad network, maybe even NBA 2K.
“Where in-game advertising started was like literally a sign in the back of your character,” said Michael Wolf, CEO of Activate Consulting. “[Today] if I look at a game like NBA 2K, [theoretically] there’s the ability when you’re playing with other people to have a coffee with your friend. And you can imagine that the coffee with your friend is at Starbucks. Similarly in Grand Theft Auto, there’s an actually real world casino, and so on.”
Until then, some would advocate for looking at gaming through a much broader lens than the “AAA Title,” console audience.
“I don’t think gaming is going anywhere,” said Rubin, who noted that companies ranging from Netflix to Samsung to of course, the New York Times are expanding the literal playing field for gaming well beyond the core PC or console gamer. “We have to get past this connotation of gamer. If you want to reach the gamer bros in their basement, that is one thing. If you want to reach players, they are increasingly everywhere.”
For Every Identity Crisis There’s an Opportunity
On my podcast this week I talked with Fabrice Beer-Gabel, Vice President Strategy & Partnerships, Intent IQ, about the state of cross-platform measurement in a Post-Cookie-Apocalypse, AI-is-Taking Over-Media-Buying-Era. He and I spoke about why getting cross-platform measurement right keeps getting harder, and more vital. Which is why the identifier race is so fierce.
“We’re in a world of outcomes. There is more and more pressure…and that drive for outcomes creates competition. And in the case of ad agencies, everybody has to differentiate and build differentiation, which comes a lot from the data and the knowledge they have about their users. “
“Eventually, that data and that differentiation needs to translate into the way they reach the target users, they activate the by media, they measure performance, and it resolves down to an identifier.“
“Ultimately, the right identity resolution can double [a brands’] reach..andcan increase bottom funnel performance by 80%. We have to tie everything to results because that’s the world we live in right now. We have to deliver outcomes.”
Check out the full episode here: