From Games to Goldmines: The Marketing Benefits of Roblox for Brands

Digital marketing is always changing. There's always a new platform coming out. There are times, however, when a platform that's been around a while becomes more popular and matures. Roblox is one of those platforms. So let's dive in and figure out its game that has big brands hooked on to it.

What is Roblox?

Roblox is a gaming platform that combines the elements of social media, metaverse, and commerce. This is a global immersive platform where users can connect, build communities, and make purchases. In other words, it's an online platform and storefront where users can create and play games. There are a lot of online gaming platforms out there. What makes Roblox so special? Well, it has more than 40 million games made by users. I repeat, users. They're regular people like you and me, game developers, and even brands that make these games! With Roblox, brands are creating captivated and connected digital experiences.

Who uses Roblox, and how does their demographic profile look like?

Their website says Roblox has 79.5 million daily active users and 17.4 billion engagement hours. It's billion, not million. Their ecosystem has 2.5 million developers and 5.3 million active experiences.

According to their investor report, the United States, United Kingdom, and Canada are Roblox's biggest markets. And it's expanding into Europe, APAC, and beyond. With Japan's DAU growing 107% YoY, the platform is seeing significant growth in these regions.

The demographic profile of its user base is also changing as the platform evolves. Most of its users are kids and teenagers. Roblox categorizes its users by age - Under 13 and Over 13. In the past two years, the Over 13 category has grown faster than the Under 13. Some reports say the 17-24 age group is its fastest growing demographic.

The Roblox model is freemium. You can use it for free. That's true for most of its games as well. However, users may have to buy in-game items with Robux, the in-game virtual currency. Robux can be won during experiences or bought with subscription plans.

What are the marketing benefit of Roblox?

Clearly, Roblox has become the go-to platform for brands looking to reach Gen Z and Gen Alpha, the true digital natives. It's been around since 2006, but its growth surged during lockdown periods when students weren't able to interact in person and looked for new ways to connect.

The way Roblox's immersive ecosystem has evolved, it seems highly responsive to its users' needs. Among Roblox's core pillars is the longevity of its user base, which includes brands. Roblox puts a lot of emphasis on presence, persistence, and interaction. By understanding the demographic profile of its user base, brands can create immersive experiences and keep introducing new products that integrate seamlessly into those experiences.

It offers Branded Experiences, which is a way to introduce your brand to Roblox's immersive world. A Branded Experience is an interactive virtual space created by a brand within the Roblox platform, similar to an advergame. Brands can directly engage with users through immersive gameplay, storytelling, and unique activities. As a result, they can effectively connect with a younger audience in a fun and social way, often extending their real-world brand identity online. Marketers can evolve, optimize, and continue these experiences to become interactive playgrounds, authentic extensions of their brand, and effective channels for engaging their target audiences and converting them.

Roblox also has advertising options. These marketing opportunities aren't just banner ads in a virtual world. They've been designed to engage Gen Z and Gen Alpha. There are four types of ads: sponsored experiences or items, user ads, immersive ads, and independent ads. The ad formats are only available to users over 13.

With Sponsored Experiences and Items, marketers can promote their User Generated Content (UGC) on the Home Page and Discover Page for experiences and Marketplace for items, under the clearly labeled "Sponsored" categories. Users Advertisements advertise UGC through banner ads, but they're often hidden by ad-blockers.

Last year, Immersive Ads rolled out to help marketers seamlessly integrate ads in their experiences like billboards in the digital world. In this way, Roblox can dynamically deliver ad content to an audience who's already engaged.

Finally, Independent Advertising lets brands work directly with developers to create content aligned with their brand. As a result, you'll be able to target marketing campaigns to specific audience segments, ensuring that your marketing strategy resonates with your target audience.

There are two things to note about Roblox's advertising options. In a way, they support brands that already have a presence on the platform by releasing branded experiences. Additionally, they're mainly for people over 13 years old.

Use cases that Roblox is helping brands solve,

Due to apparent marketing benefits of Roblox, its popularity among brands and marketing agencies has recently grown. In the past few years, it's found its way into the marketing strategies of many prominent fashion and retail brands. Let's look at how brands use Roblox to create brand awareness, do soft launches, and drive sales.

Brand awareness

For brand awareness and reach, Nike, Ralph Lauren, H&M, and Chipotle have invested in the platform. Players could explore Nike's real-life headquarters in Roblox, play minigames, and even create their own games with the NIKELAND toolkit.

For a limited-time experience, Ralph Lauren created the Ralph Lauren Winter Escape, where users' avatars could wear up to eight sportswear looks and select items from the brand's current collections.

In an attempt to reach and engage their audience who are increasingly spending time in virtual spaces, H&M created an immersive experience called The H&M Loooptopia.

The first 30,000 Roblox players received $1 million in free burritos from Chipotle's Halloween corn maze game. By gamifying marketing, Chipotle was able to expand its digital presence and build customer loyalty.

Soft launches

Forever 21 and Nike have used the platform to soft launch their products and see how their audience reacts. Within NIKELAND, Nike built a virtual showroom so players can try on and wear official Nike apparel. This concept offers brands an interesting way to soft launch their products.

Forever 21 launched a virtual world called the Shop City to test a new set of beanies. It was about informing its product strategy in real life. This helps them see what works in one channel and if they should launch in another. This could also make the channel mix clearer.

Driving sales

Some brands have even used rewards and offers to get people to convert. For their upcoming movie 'Beetlejuice, Beetjlejuice', Roblox teamed up with Warner Bros. and Fandango to sell tickets.

Nikeland has received over 21 million visitors since its launch. More than 118,000 gamers have favourited it. This has led Nike's digital revenue to grow to 26% of its total revenue.

although a few concerns remain.

Roblox has become an effective marketing tool for brands targeting Gen Z and Gen Alpha, but their age range has raised some concerns. There's one around stealth tactics the platform allows through its immersive experience. There's an argument that it enables 'transfer of meaning,' i.e., the positive attitude of young players engaged in the games is subtly transferred to the in-game advertising.

Another one is Roblox not mandating the disclosure of branded experiences. As brands use the platform to deliver immersive virtual environments indistinguishable from other games, they can camouflage their message, products, and brands to people who otherwise wouldn't care.

Along with restricting ads for kids under 13, Roblox has made specific guidelines available on its corporate website to address these concerns.

With all this in mind, Roblox has become a popular platform for targeting digital natives. Roblox has created an ecosystem that acts as a virtual playground for Gen Z and Gen Alpha users, brands, game developers, and digital creators. This ecosystem enables brands to deliver demographic-based immersive online experiences. As it enables immersive brand experiences and in-game advertising, it's bringing more attention to brand awareness.

Some estimates say Roblox's popularity will keep growing. This could mean the platform's demographic profile will get wider and richer if it keeps attracting Gen Z and Gen Alpha users while adding new ones. Then there is the aspect of AR/VR tech products from Meta and Apple which are likely to make the metaverse a reality. So brands will probably have to start building their presence on platforms like Roblox to reach and engage with virtual communities. Marketers and brands, especially outside the US, Canada, UK, and Japan, must keep an eye on this unique platform and be ready to play.