Microsoft hoping to sell lots of political ads on XBox Live, video games

Ads in video games are not new but Microsoft is looking to use more recent technology and information to sell political ads in its online spaces:

Microsoft is trying to persuade politicians to take out targeted ads on Xbox Live, Skype, MSN and other company platforms as midterm elections begin heating up around the country. To plug the idea, Microsoft officials handed out promotional materials Thursday at CPAC, the annual conference for conservatives.

It’s the latest move by tech companies to seize a piece of the lucrative political ad market. The ads, which would appear on the Xbox Live dashboard and other Microsoft products, combine Microsoft user IDs and other public data to build a profile of Xbox users. Campaigns can then blast ads to selected demographic categories, or to specific congressional districts. And if the campaign brings its own list of voter e-mail addresses, Microsoft can match the additional data with individual customer accounts for even more accurate voter targeting.

The image of white male teens as the stereotypical average gamer is something of a myth; Microsoft says that of its 25 million Xbox Live subscribers in the United States, 38 percent are women. Forty percent are married, and more than half have children. Those numbers are important, because they represent key demographics that are among the most contested in political races. Microsoft is particularly aggressive in selling its ability to reach women, Latinos and millennials; across the company’s other platforms, such as MSN, Microsoft has developed consumer categories like “Ciudad Strivers” and “Nuevo Horizons” that attempt to describe a set of characteristics including age, type of residence and income level. At a time when virtually all politicians are resorting to microtargeting, this technology could help Microsoft become a major player in the advertising space…

Microsoft has made successful pitches to political campaigns before. In 2012, President Obama agreed to advertise on Xbox Live for his reelection campaign. The effort sparked some complaints among Xbox users who disliked the ad appearing on their dashboards. Republican presidential candidate Mitt Romney, meanwhile, opted not to participate. Obama has also advertised within games themselves. With the release last year of the Xbox One, it’s safe to expect Xbox Live to become another important platform in the political ad wars.

It will be interesting to see how users respond and then how effective such ads are. This shouldn’t be much of a surprise to users: we shouldn’t be surprised if we volunteer data online and then it is used for targeted ads. Plus, given the time people spend playing video games (particularly for demographics that might not be accessing more traditional media as much), this seems like a relatively untapped market compared to television. Yet, it is harder to argue this has many benefits for users. While some might argue targeted ads for consumer goods show people what they might want, what average XBox Live user wants to be presented with political content while trying to play a game?