The first two advergames, created in the heyday of Max Headroom and Miami Vice, were bizarre failures. Kool-Aid Man, created for the Atari, was labeled the “Stupidest Video Game of 1983″ by one magazine. Budweiser’s Tapper by Midway was an arcade game that became popular with children. When marketing ethics were invented later that year, the alcohol branding was removed.

The reality is that most advergames on the web are still absolute junk. Many are just casual web games with logos slapped in, little campaign integration and brand messaging that is delivered peripherally, rather than through game concept itself. The reason for this stems from the fact that advergaming is an advertising field in its infancy, one largely managed by game developers who don’t understand advertising who are working with advertisers who are still struggling to understand the dizzying array of changes in media.

But, we’re all learning together, and what we’re seeing emerge is a model of creative development that closely mirrors what’s happening with branded entertainment in television and movies, only this time it’s in a medium with fewer and fewer creative restraints.

This requires a fundamental shift in creative thinking for the development of good advergames once you move beyond selling cars and soccer cleats, which naturally lend themselves to traditional games like racing and sports. Developers and creatives now have to ask themselves how they can build a truly engaging game around a chocolate bar or a condom, and how to integrate it into a campaign.

The first step is understanding the technological capabilities that we now have at our disposal. Online games have evolved from Java applets to Flash and Shockwave — and we’re coming closer and closer to the territory of console quality gaming directly in the browser. In our case, the implementation of VirTools has allowed us to create stunning 3D textures and light maps that have never been matched by Shockwave.

Flash can allow us to create games in isometric 3D and experiences that leverage interactive animation, video, and photography. Shockwave and VirTools allow us to take that one step further and create online multiplayer worlds: first person shooters, MMORG’s — even a virtual world to just explore.