Online ads are in the game. (High Tech Colorado Biz).

MARKETERS HAVE BEEN TRYING TO HARNESS the Internet for years with mixed results.

Banner ads have had their day. Pop ups and popunders, ubiquitous now, still don't have the impact--judging by their price--that ads had when the online advertising market peaked three years ago.

"The inventory went way past demand," Stein added. That, "coupled with a perception of decreased value of the medium itself," did in the market.

But the Internet's ad woes don't mean companies can't still make an online commercial impression.

One ad concept known as advergaming--using games as ads--had its roots early in the dot-coin era, and has persisted through its decline. Now, because of the rising popularity of online gaming--more than half of the 35-to-44-year-old demographic plays weekly--advergaming is looking more and more like a viable means of making that impression.

And its cost per minute of eyeball time is slight compared with TV.

Colorado hosts two advergaming companies, CleverMedia in Denver and Leviathan Games in Boulder, which also has offices in Seattle where the bulk of its employees work.

CleverMedia has created games for such customers as Saturday Night Live, Frito-Lay and Minute Maid; Leviathan's client roster includes Visa, Hyundai and Fox Sports.

"There's definitely a backlash to the whole ad banner thing," said Wyeth Ridgway, Leviathan's president and technical director. "People might be paying attention, they might not. During a game, they're actively engaged."

That's the point. Players actually play their game within the world of the commercial.

Leviathan, for example, developed the Hit the Pros baseball game for Fox Sports' site in 2001 and attracted 1 00,000 unique visitors who spent an average of 30 minutes playing. Ridgway said that the cost of an advergame--$50,000 to $1 50,000 at Leviathan--is 15 times less expensive than TV time, based on the duration of exposure.

And duration of exposure depends on the game.

"Advergaming is not our primary business goal--designing good games is," said Gary Rosenzweig, CleverMedia founder and chief engineer. "Good game design and the needs of the client, they don't necessarily conflict, but you have to reconcile a few things."

Generic games with a tacked-on logo are out; custom games that incorporate the brand message into play are in.

The old ad credo, "Make the product the hero," is a good design guidepost, said Stein. "You want something fun and simple, something that's easy to master and addictive."

To wit, Leviathan recently developed an advergame for BellSouth to tie in with a DSL promotion. In the NASCAR-style racing game, drivers gain speed when they run over a DSL icon, but are slowed by modemshaped potholes. "We used the game elements to reinforce the brand message," said Ridgway. "'DSL is good, modems are bad."'

Beyond advergaming, other game-related ad strategies are starting to emerge.

Last year, McDonald's and Intel inked multimillion-dollar deals to place their products into the recently launched The Sims Online, a subscription-based online game.

The medium is still finding itself, said Jupiter's Stein. A 2001 Forrester projection of a $1 billion advergaming industry by 2005 "is pretty optimistic," he said, noting that the tech slump and the advertising recession have strained growth.

Ridgway, however, said business has been good, and Leviathan is planning on expanding in Boulder. "We haven't seen spending go down at all," he said. "We've actually grown. And 2003 looks even better."