Online ads are in the game.

• Author: Peterson, Eric
• Position: High Tech Colorado Biz - Advergaming; CleverMedia and Leviathan Games Inc. - Company Profile

MARKETERS HAVE BEEN TRYING TO HARNESS the Internet for years with mixed results.

Banner ads have had their day. Pop ups and popunders, ubiquitous now, still don't have the impact--judging by their price--that ads had when the online advertising market peaked three years ago.

"CPMs (cost per thousand impressions) have sort of found the bottom' said Gary Stein, an analyst with Jupiter Research. The average Internet CPM is now $1.13--down from a year-2000 norm of $4 or $5, and when some very targeted sites enjoyed as much as a fat $100 per CPM.

"The inventory went way past demand," Stein added. That, "coupled with a perception of decreased value of the medium itself," did in the market.

But the Internet's ad woes don't mean companies can't still make an online commercial impression.

One ad concept known as advergaming--using games as ads--had its roots early in the dot-coin era, and has persisted through its decline. Now, because of the rising popularity of online gaming--more than half of the 35-to-44-year-old demographic plays weekly--advergaming is looking more and more like a viable means of making that impression.

And its cost per minute of eyeball time is slight compared with TV.

Colorado hosts two advergaming companies, CleverMedia in Denver and Leviathan Games in Boulder, which also has offices in Seattle where the bulk of its employees work.

CleverMedia has created games for such customers as Saturday Night Live, Frito-Lay and Minute Maid; Leviathan's client roster includes Visa, Hyundai and Fox Sports.

"There's definitely a backlash to the whole ad banner thing," said Wyeth Ridgway, Leviathan's president and technical director. "People might be paying attention, they might not. During a game, they're actively engaged."

That's the point. Players actually play their game within the world of the commercial.

Leviathan, for example, developed the Hit the Pros baseball game for Fox Sports' site in 2001 and attracted 1 00,000 unique visitors who spent an average of 30 minutes playing. Ridgway said that the cost of an advergame--$50,000 to $1 50,000 at Leviathan--is 15 times less expensive than TV time, based on the duration of...