Digital Real Estate Destroys Physical Real Estate in Advertising

The “real estate” metaphor long has been applied in the “virtual” spaces created by operating systems (homescreens and notifications), applications (content apps, search, social media, e-commerce venues), lockscreens and browsers (home screens and tabs), with monetization platforms thereby created for advertising or other forms of sponsorship. 

All create value based on user attention and interaction, much as traditional pre-internet linear media and content also created attention, and thereby audiences and ad potential. 

Digital Real Estate	Monetization Platforms	Examples
Lockscreen	Targeted advertising & content, app discovery, In-screen commerce	Glance, Apple Lockscreen widgets
Browser Homepage & New Tab	Search engine results, sponsored content, tiles, bookmark monetization	Google Search homepage, Yahoo New Tab
Operating System (OS) Home Screen & Notifications	Pre-installed apps and bloatware, paid app placements, Sponsored notifications	Android app placements, iOS Spotlight suggestions
App	In-app advertising (banners, interstitials, video ads), Freemium model with in-app purchases, Subscriptions	Most mobile games, Social media apps
In-Game Environments: The virtual world players navigate within the game.	In-Game Advertising: placing billboards, product placements, or branded content within the game environment. Virtual goods sales: selling cosmetic items, outfits, or customizations for characters or in-game objects. Limited-time events: creating temporary events or challenges that players can access for a fee.	Forza Horizon (Virtual billboards), Product placement in sports games like FIFA or Madden
Menus and Interfaces: Screens and interfaces players interact with to manage their game experience.	Targeted in-app advertising: displaying ads based on player data and preferences within menus or loading screens. Premium Currencies: Selling a secondary currency used for specific purchases within the game (separate from in-game currency earned through gameplay). Battle passes: offering tiered reward systems where players progress through challenges to unlock exclusive items or features.	Fortnite (Cosmetic microtransactions), Apex Legends (Battle Pass), Diablo 3 (Expanded inventory slots)
Gameplay Mechanics: The core rules and systems that govern how players interact with the game.	Subscription models: providing access to additional content, features, or servers through a monthly subscription. Expansion Packs: selling downloadable content that adds new levels, storylines, or features to the base game. Loot boxes: offering randomized virtual items through purchasable containers, potentially including rare or desirable items.	World of Warcraft (Subscription services), Call of Duty: Mobile (Double XP Boosters)

Some idea of the value of such digital real estate can be seen in changes in ad placement in pre- and post-internet advertising. 

Put simply, digital now claims up to 82 percent of all U.S. ad placements and revenue. Print has declined from 42 percent to less than three percent. Linear video dropped from 38 percent to 16 percent. Radio dipped from 10 percent to half a percent. 

Channel	1996 (Billions)	1996 (%)	2023 (Billions)	2023 (%)
Print (Newspapers, Magazines)	80.0	42.1%	10.0	2.7%
Linear Video (TV Broadcast, Cable)	72.0	37.9%	60.0	16.2%
Network Radio	10.0	5.3%	2.0	0.5%
Other (Radio Spots, Out-of-Home)	28.0	14.7%	18.0	4.9%
Digital Ads (Search, Social Media, Display)	-	-	300.0	81.7%