This is a complimentary article from YPulse Daily Intelligence. Get your first month for $1.

💡 Gen Z craves immersive, interactive brand experiences rather than just digital products (though those are welcome too)

💡 They think brands can be fixtures in their virtual worlds, but they prefer pop-ups

💡Gen Z prefers to spend virtual currency from brands in-game rather than on IRL rewards

For years, YPulse has stressed that the future of marketing lies inside video games—and the brands that understand this are the ones with the best chance forming real connections with young consumers. When it comes to brands showing up in their favorite virtual world, Gen Z isn’t only okay with it—they expect it. YPulse’s Gaming Marketing Playbook trend report shows 51% of 13-17-year-olds and 48% of 18-24-year-olds agree, “All brands should get involved in video games.” On top of that, 74% of teens and 59% of young adults think “more brands getting involved in video games make gaming more interesting / unique.” But here’s the thing: not all in-game marketing hits the same to them. Some strategies will be more successful than others among the typical gaming integrations—whether virtual merch, experiences, or monetary rewards.  

Our data shows video games rank as the second top place that both teens and young adults say they actually pay attention to marketing. In fact, 60% of 13-17-year-olds and 62% of 18-24-year-olds enjoy spotting a brand’s in-game advertising. And the majority of 13-24-year-olds are interested in all kinds of brand activations—from branded skins to in-game experiences — so there’s no single right way to engage them. But if Gen Z is open to all kinds of brand involvement, what actually sticks and makes their gaming experience with brands most enjoyable?  

In YPulse’s Gaming Marketing Playbook, we break down 13 of the most effective strategies for advertising in video games, diving deep into the marketing efforts that feel most natural to the gaming experience. Comparing some popular strategies we’ve seen over the years, we ask 13-39-year-olds to choose which kinds of gaming marketing they prefer. It’s crucial for brands to understand their perspectives on what kinds of marketing tactics work—because if you’re going to show up in their world, there’s no need to guess what they want: 

Gen Z prefer branded virtual experiences over products in video games  

When it comes to choosing between a virtual product and an experience, 60% of Gen Z would rather live in the moment with a brand than own a piece of virtual merch. Teens are even more likely (63% of 13-17) than young adults (57% of 18-24) to prefer a virtual experience to a virtual product from a brand. For them, buying something in a game is cool, but living it? That’s what makes gaming even better. Brands that get this are already winning—whether it’s through in-game concerts, mini-games, or spaces to hang out in the games. We told you before how Alo Yoga brought “community-driven wellness” to Gen Z with their Alo Sancturary on Roblox, a space filled with virtual yoga classes, meditation zones, “ice plunges” and more, all aimed at encouraging healthier lifestyle habits both in and outside the game. 

But our data shows brands don’t always have to create something from scratch, like a virtual world platform of their own— Gen Z wants to see companies enhancing the games they already love. YPulse data shows that when it comes to brands in games, 56% of 13-17 and 57% of 18-24 agree, “I want them to add an experience or product to an existing game.” There are unlimited examples of in-game activations now, but some experiences show all the ways brands can engage. For example, Ulta Beauty teamed up again with Roblox last holiday season for its House of Joy, the newest installment in the “Ultaverse.” Players could design their dream beauty store, add products to their collections, and complete quests to unlock rewards, turning the brand activation into a full-on adventure.  

At the end of the day, this gen craves immersive, interactive worlds where they can be the main character, having experiences they might never see IRL. Brands that lean into this—whether by crafting in-game experiences or building their own digital spaces—will be the ones that truly connect with young consumers.  

They’d rather have a branded pop-up over a mainstay in their gaming worlds  

Pop-ups aren’t just for trendy sneaker drops or surprise merch releases—they’re taking over gaming, too. And when it comes to choosing between a pop-up or a permanent brand event, Gen Z leans toward limited-timed experiences. YPulse’s Gaming Marketing Playbook shows 55% of 13-17-year-olds and 60% of 18-24-year-olds prefer a brand pop-up versus a permanent brand event. These short-term events keep things fresh, allow brands to experiment with new themes, and of course, create opportunities to get limited-edition rewards. Take Fortnite’s Coachella Island, which brought a virtual version of the festival to the game for two weekends only. It came with new emotes, mini-games, and unique content that someone not plugged in those weekends wouldn’t get to have. 

That said, Gen Z is interested in pop-ups and long-term brand activations—but that doesn’t mean brands need to do both. A well-executed mini-game or pop-up can generate just as much excitement as a permanent in-game world. For brands with existing gaming spaces, integrating new experiences through pop-ups, limited-time challenges, or seasonal events can keep players engaged without overwhelming. So, brands should remember: keep it exciting, culturally relevant, and sometimes, temporary. This gen thrives on novelty, always looking for the next big thing—and in gaming, exclusivity and time sensitivity just might be the thing to keep them coming back. 

They’d rather use their virtual coins on in-game purchases than IRL ones 

When it comes to spending virtual currency they might earn from brands, Gen Z prefers to keep it where it matters most to them—in the game. YPulse’s Gaming Marketing Playbook shows 64% of 13-17-year-olds and 57% of 18-24-year-olds prefer using their virtual coins for in-game purchases over IRL ones. And honestly, who can blame them? This gen is so obsessed with their virtual money that even back in 2022, some were rejecting actual cash inflows favor of Robux, the digital currency used in Roblox. Using their virtual rewards for real life purchases is also simply something they’re less likely to be doing: 47% of teens and 43% of young adults say they haven’t used in-game rewards to buy a physical/ IRL item. Meanwhile, YPulse’s Gaming report shows that on average, teens spent $187 and young adults spent $200 on video game-related expenses in the past year—some of which certainly went toward virtual currency for in-game purchases. 

For them, in-game currency isn’t just about spending—it’s about enhancing their experience. Not only does it give them the freedom to customize their gameplay and maximize their time, but to fully create a digital identity that feels personal. Whether it’s buying accessories, power-ups, or custom skins, they’re investing time and real money into perfecting their perfect digital identities, which includes their avatars. YPulse’s Gaming behavioral report 52% of 13-17-year-olds and 44% of 18-24-year-olds of virtual game players say that their avatars represent their personalities, so it makes sense that they’d rather have their virtual currency to deck those avatars out. After all, if they can’t afford certain brands IRL, whether because it’s a luxury or they’re just too young, at least their avatar can wear it!  

That said, they still appreciate a connection to the real world: 74% of 13-39-year-olds agree, “In-game rewards in video games should come with a reward to use in real life.” If given the choices, they’d prioritize enhancing their gaming experience, but if they could have both? Even better.