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New guidance on how advertisers can responsibly market in-game purchases has been published by the Committee of Advertising Practice. CAP’s latest guidance aims to bolster consumer protections and raise awareness of how misleading in-game purchases can be.

Loot boxes are just one of the issues being debated by government ministers as part of their gambling legislation review. ©EVG Culture/Pexels

Raising Advertising Standards

New guidance published by CAP seeks to clarify to advertisers how they can safely and responsibly market games containing in-game purchases. The Advertising Standards Agency, also known as the ASA, wants to crack down on misleading ads and raise standards when it comes to gaming ads.

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Announcing the changes, the ASA set out the difference that the new guidance would mean for advertisers and consumers. The guidance is focused on in-game virtual currencies, the cost of in-game purchases, engagement mechanics and how games that contain purchases are advertised.

It says that the new rules will make it easier for consumers to understand how much they are spending on in-game transactions. It also wants to ensure that it is clear for consumers before they purchase a game whether it contains in-game purchases. That includes clarifying whether or not games contain loot boxes.

Another change that the ASA wants advertisers to take note of is that they must make it clear when in-game content is reliant on making extra purchases. Explaining the guidance, the ASA states that it relates mostly to in-game advertising and the online or in-game “storefronts” at which digital items can be purchased.

The rules will apply to virtual currencies that can be bought using real money. Developers will have to disclose the value in real money terms of items that can be bought in-game using virtual currency. However, games that offer virtual currencies only as player rewards will be excluded from the CAP rules.

Government Concerns

Some aspects of the guidance apply to adverts for in-game purchases that are external to the game, such as emails marketing new items for sale. Adverts for games that include in-gaming purchasing, for example a TV ad for game, are also included in the refreshed guidelines.

The ASA has said that it will continue to monitor the use of mechanics that it describes as predatory, such as countdown offers, bundles and time-limited offers. Advertisers will also have to be more careful about their use of language when promoting purchases, as they can no longer use complex offers or imply that purchases will lead to success.

The ASA has noted that some advertisers will need time to adjust to the changes. For six months, it says that it will be willing to deal with complaints informally where changes to in-game content are necessary. Other kinds of ad covered by the guidance will be given a similar grace period. The ASA says that after this period, it will return to its usual procedures when it comes to deciding which cases to take on formally.

The new CAP guidance comes as part of a consultation led by the ASA last year. The consultation was launched in response to concerns raised by the government’s DCMS select committee over how loot boxes had been targeted based on age, and how prizes were valued. The select committee also questioned whether in-game ads could come under the remit of the CAP code.

The new CAP advertising rules will apply to popular online games such as GTA Online, which offers its own virtual currency through Shark Cards. The online game also launched one of its most controversial features to date in 2019, when it unveiled the Diamond Casino & Resort.

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Loot Boxes are Changing

Many other games also utilize similar kinds of virtual currency, as well as loot boxes. Loot boxes have become one of the most contentious issues in monetized gaming, as players cannot see what they are buying until after they have made a purchase. This has been compared to gambling, and studies have proven links between loot boxes and problem gambling.

Pressure is mounting on law-makers to take action on loot boxes, either by age-gating them to over-18s or legislating against them altogether. Some developers have already taken it upon themselves to move away from including loot boxes in their games, while others have adapted how they are used.

EA’s upcoming FIFA 22 Ultimate Team will retain its loot box feature, but it has been revealed that preview packs will be included. However, EA has maintained that its loot boxes have never constituted as gambling.

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The ASA says that it has consulted the Gambling Commission on whether loot boxes and similar reward mechanics should be categorized as a type of gambling. The regulator responded that it was not able to make a determination on the matter, although it is possible that it will bring in rules on loot boxes in the future.

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The government is currently in the midst of a review of its gambling legislation, which it commenced last December. It is expected to publish a white paper soon, although that may be delayed by the prime minister’s recent cabinet reshuffle. Loot boxes and other issues such as football shirt sponsors and VIP schemes have been up for debate and could be subject to changes to the law.