There’s a common perception that video games represent pure escapism. To a certain degree, that’s true; video games are able to create fantastical worlds and have players inhabit them in a way that simply isn’t possible for other media. Still, it’s not entirely right to say video games offer pure escapism. There are many games set in the real world; there are games that focus on actual historical events; there are games that purport to teach moral lessons. These games aren’t offering escapism per se.

One of the ways in which video games incorporate realism into their structure is with in-game advertising. Whether it’s for real brands or fictional in-game ones, sandbox games and titles with a focus on realism tend to include ads in order to increase players’ immersion (and, of course, sometimes in order to get players to buy stuff). The in-game advertising (IGA) industry is worth multiple billions of dollars, so it’s clearly an area that brand leaders and corporations want to target.

So, how did we get here? Where did in-game advertising begin? The answer may surprise you. Back in 1978, developer Scott Adams created a text adventure for microcomputers called Adventureland. That game contained product placement for Adams’ followup game Pirate Adventure. This is, as far as we can tell, the first instance of product placement in video games, and although it’s a fairly cheeky and archaic example, it’s still a real-world product being advertised within a game.

During the early 1980s, several “advergames” began to appear. These games were usually paid for by corporations or funded in part by advertising agencies. Examples include Johnson & Johnson’s Tooth Protector and Ralston Purina’s Chase the Chuck Wagon. The former is a rather curious game in which you must fend off the “Snack Attackers” using your toothbrush and floss. The latter revolves around the Chuck Wagon of Ralston Purina’s commercials.

After the crash of 1983, although advergames and advertisements in games continued to flourish, video games as a whole took something of a sabbatical. That changed when Nintendo brought the NES to market in 1985. Here we start to see games like Yo! Noid appear, along with perhaps the most egregious example of in-game advertising thanks to candy brand Chupa Chups’ appearance in Zool. At this stage, advertising in video games isn’t particularly sophisticated.

As the industry moved into the 1990s, the FIFA franchise was born, and with it came real-life billboard ads in stadia. FIFA 98 may not be the very first example of real life in-game advertising, but it did feature billboard banner ads for brands like McDonald’s, Gillette and Snickers during matches. Various other sports properties picked up on this possibility and ran with it, creating a world in which you were likely to see ads for real-life brands during your gaming sessions (although not usually in fantasy or sci-fi games).

Back in 2002, companies like IGA Worldwide and Massive Inc. pioneered the inclusion of video game advertising in games on a worldwide scale. The market for this type of advertising grew exponentially; corporations were beginning to understand the possibility of advertising to an entirely new demographic they hadn’t previously thought of, and as games’ visuals became more sophisticated, the possibilities for in-game advertising increased with this technological advance.

Around this time, Grand Theft Auto III hit the scene. With this pioneering game came the concept of fictional in-game brand advertising. The 3D GTA games created brand identities for fictional companies, allowing players to buy into their universes even further. This type of advertising has continued into the modern era of gaming. You can see how in-game brands size up next to their real-life counterparts in this awesome Betway infographic.

Indeed, it’s hard to ignore the impact of things like esports on the advertising world. With sites like Betway actually sponsoring certain esports teams, this nascent discipline is already populated by savvy and clever marketers looking to advertise their products. Esports is still a young industry, but with massive prize pools and an increasing public focus, we’ll see many more companies advertising through esports as the industry grows.

Naturally, after console gaming and PC gaming blew up in the mid-2000s, the next avenue for advertisers was the smartphone market. Targeting an all-new demographic of gamers, the smartphone market included interstitial advertising as users played games. These ads were often non-invasive, appearing to users and offering the chance to simply dismiss them and continue playing. It’s arguable that this move represents a less intrusive, more subtle form of advertising than the advergames of the 90s.

We can see the DNA of advergames in modern titles like The Simpsons: Tapped Out and Disney Magic Kingdoms. Although these games aren’t technically advergames, they do prominently feature brands that players will be familiar with, and they do feature microtransactions which allow you to buy into those brands and continue playing the game. These types of titles combine advergames and licensed properties, innovating on both in the process.

So what’s next for in-game advertising? Thanks to VR, we know the answer to this: immersive advertising in gaming. With clever implementation, it would be entirely possible to create virtual reality advertising that engaged users and communicated brand identity without sacrificing authenticity. It’s a thin rope to walk; while immersed in a VR world, no gamer wants to suddenly be jolted out of it for the chance to be advertised at for a while. Still, it’s not hard to see where advertising in gaming is going thanks to the VR space.