Last week AppLift attended and exhibited at PG Connects London, the third instalment of the event organised by Steel Media. As usual it was an opportunity to give out our beloved swag and do proper networking, but also catch up on the latest trend in mobile and mobile games marketing.
To catch up or get a refresh of the conference, here’s our non-exhaustive digest of the main insights for mobile marketers.
1. The Mobile Marketing Industry Is Consolidating
The view that the mobile marketing landscape (adtech in particular) is consolidating vertically was expressed during Eric Seufert’s introductory keynote and reflects the recent column by our own Maor Sadra on the rise of the full stack in advertising technology.
As Eric mentioned, this trend extends beyond just adtech, as the incumbent players are all developing tools for developers and publishers which, beyond the advertising channels, provide value all along the app value chain and around the user lifecycle, from development to distribution, promotion and monetization.
As can be seen on the slide blow, the big five (if you also include Twitter) are all offering a full stack of services which they have acquired either through external acquisitions or internal development. For instance:
- Facebook acquired Parse for app development, Atlas for ad serving capacities and are currently building the Facebook Audience Network to increase its inventory base.
- Apple acquired TestFlight for app testing, Topsy to understand user behavior, and is currently working on a revamped version of iTunes analytics enabling post-intall insights such a retention figures.
- Twitter bought MoPub to extend its inventory and more recently acquired Fabric, an app development platform.
These moves are aimed at achieving platform lock-in and, as competition increases and margins decrease, gain control over the whole value chain.
2. Video Is the Next Big Channel for Mobile Marketing
The data doesn’t lie: mobile video ad spending in the US will increase fourfold within just a few years, from $1.54bn in 2014 to $12.82 in 2018. As the figure for online video spend won’t increase by much over the same time period, mobile’s share will rise from 25% to almost 50% in just four years.
This trend was confirmed by several moves and announcements within the space across 2014:
- Amazon bought Twitch, the video sharing platform
- Opera bought adcolony, the video network
- Facebook acquired LiveRail
- Yahoo acquired Brightroll
- Facebook introduced auto-play video ads on mobile
- Twitter recently unveiled a native video player
- Mobile Studio Hipster Whale announced last week that it had earned over $1 million in native video ads on iOS alone for its game Crossy Road.
At AppLift we are also embracing the trend, namely through our TV and YouTube offering. Our own Michael Puriz held a talk at the conference on ways to leverage TV ads to increase ROI.
For more information on the topic of YouTube and TV advertising for mobile games and apps, head to the following resources:
- TV as the Second Screen: The Best Old New Way to Acquire Mobile Gamers
- Five Reasons Why YouTube Is an Underrated Channel for Mobile User Acquisition
- TV Webinar: TV and YouTube as Effective UA Channels
- Create and Manage a YouTube App Marketing Campaign (YouTube)
3. Brands Are Coming to Mobile, and Gaming Is No Exception
Across both the “Acquire.Engage.Monetize” and “East Meets West” tracks, one topic came back as one of the strongest drivers of mobile marketing in 2015: branding.
There are basically two ways for games to benefit for branding: build their own brand (where TV can help), or associate themselves with existing ones. Over the last couple of years, rising marketing costs and chart position inflation have indeed made it much more difficult for mobile game and app developers to become ROI-positive over their ad spend. This phenomenon is leading major mobile game publishers to partner with existing, well-known IPs and brands to increase top-of mind awareness and down the line improve marketing performance metrics.
Chris Petrovic of Kabam explained the mutual interests in these partnerships:
For game publishers:
- Access to iconic IP and global customer base
- A recognisable IP helps with featuring, UA, and performance
For brands:
- Brand stewardship
- Creation of engaging and long-lasting gameplay experiences (24/7 access to the brand, good to sustain the brand until the next product release)
- Global development and distribution capabilities
Robby Yung of Hong-Kong-based outfit Animoca also gave his vision of the partnership:
Mobile game publishers should take the opportunity to leverage brands in order to:
- Improve visibility in the app stores (marketing performance)
- Tap into an existing fan base
- Achieve product differentiation in a crowded marketplace
- Modulate marketing expenditures (improve ROI)
15M vs 500k. The revenue impact of Kim Kardashian compared to a identical mobile game. #PGConnects pic.twitter.com/UCU7SO71F6
— Stefan Bielau (@StefanBielau) January 14, 2015
On the other hand, it should be clear what brands are looking for:
Contrary to popular opinion, the first reason for them to partner up with studios is not the money. They are not interested in the incremental revenue you can bring them and, in most cases, they don’t need you. Their primary concern is, as Robby put it: “Are you going to mess it up?”. Through the partnership IP holder wants to generate brand value for at least 5 years, and for this reason they value trust above all things.
4. How to Make It In Asia, Reloaded
Asia makes up half of the world’s mobile games revenues and, as it did for last year’s London edition, rightfully benefited from a dedicated track at PGConnects. For a full-on review of PGConnects 2014, where we covered most of the main must-know idiosyncracies of the asian markets, head to our “East Meets West” wrap up from last year.
Along the talks we were very pleased to see our eBook on Asia’s biggest 3 mobile games markets, which we published together with Newzoo, mentioned both by the CEO Perfect World, Robert Xiao and Gamevil’s General Manager for Europe David Mohr.
As mentioned we already covered a lot in last year’s wrap up as well as in the rest of our resources on Asian mobile marketing, but here’s a quick update, complete with a stats bonanza:
China:
- Unsurprisingly, China is the largest market in terms of users, with almost 360 mobile gamers in 2014.
- 4G users will surpass the 90 million in 2014 and is expected to reach 250 million in 2015. - Robert Xiao, Perfect World
- 60% of the 800 million active devices are distributed in Tier-3 and -4 cities.
- 38% of Chinese mobile gamers are female
- 56% of Chinese mobile gamers use large screen resolutions (over 1280×720)
- Mobile gamers are concentrated around the Eastern seaboard of China - Ibrahim Dai, Talking Data
Japan:
- Japan makes up 30% of worldwide mobile gaming revenue; revenue per download is 3 times the global average on iOS and 6 times on Android. It’s not uncommon to see ARPPUs in the range of $200 and ARPUs of over $5.
- What works in Japan: TV commercials and offline marketing, distribution through mobile carrier app stores.
- What matters in Japan: Font sensitivities, smart tutorial (short, precise, with story telling), 2nd day retention (should be 30% min), fast connection, with servers based in Japan - Paul Krömeke, Goodgame Studios
South Korea:
- LTE penetration is 99% (highest in the world)
- Smartphone penetration is 73%
- Of the >90% Android market share, Samsung makes up 63% and LG 22%
- Huge investments on TV and outdoor, offline commercials are necessary to reach top chart positions – the Seoul subway is where the players are! – David Mohr, Gamevil
Do you think we missed on an important marketing trends, have comments or questions? Let us know through the comments below or send us an email at blog[at]applift.com