Marketing requirements in game publishing contracts

This is an excerpt from the free ebook, Key Provisions in Video Game Publishing Agreements.

In the marketing provisions [of a video game publishing agreement], there are three main questions to answer. Who has responsibility for marketing? Who has the right to market? Who has creative input in the marketing?

The agreement should explicitly say who has the responsibility for marketing. If the publisher is expected to expend a certain amount of resources, or do specific marketing tasks (TV ads, event promotions, etc.), that needs to be spelled out. If the developer is required to take on any particular tasks, or to make themselves available for interviews and the like, that should be included as well. If this is not specified, whoever owns or controls the intellectual property rights for these purposes will, kind of by default, need to market or sublicense out the right to market.

If the publisher is required to spend a certain amount, the agreement should specify whether or not that amount can be recouped from sales revenue. If it can be recouped, the agreement should include a cap on that spend so that the publisher can only spend additional amounts with the developer’s permission or by waiving the recoupment. This prevents runaway marketing expenses, especially internal expenses (those “spent” by the publisher on an affiliate or internal marketing team) from cutting the developers revenue share to zero.

Even if the agreement specifies that one party has all of the responsibility for marketing, it might be worth carving out or including a second right for the other party to do some marketing as well. For example, if the publisher is taking on all marketing tasks, but the developer has a good social media following, it might be in both parties’ interest to allow the developer to continue engaging that audience. Likewise, if the developer retains all marketing responsibilities, the publisher may want the ability to spend some of its own money to ensure a successful launch.

Finally, in any case, the agreement should lay out whether either party has any oversight or input in the other party’s marketing efforts. If one party has the right to develop future titles and other products, they may have a stronger interest in ensuring both a successful launch for the first game, and also preserving a consistent brand identity and narrative for the future. Still, if there is a backend split, both parties have an interest in successful marketing, and both may want some oversight.

Often, one party will have ultimate control, but will agree to “meaningful consultation” or “reasonable input.” It is important to recognize that while these terms may allow for participation in the process, if the other party ultimately controls the marketing, these provisions should be taken with a grain of salt. The controlling party can, at the end of the day, ignore the other party’s request.

If one party has ultimate control over everything, it might also be wise to consider timing of approvals and the like. If social media posts need to be approved every time, for example, platforms like Twitter become significantly more onerous to use.