February 2017 | Page 10 of 10

Mobile Games Earned As Much Revenue As The Box Office Last Year

February 2, 2017, 07:30AM

Mobile games now account for half of the entire global digital games market and revenue grew 18 percent over the year before. In case you’re wondering how much money that equates to, the mobile gaming market generated $40.6 billion in worldwide revenue—equal to all global box office sales during the same time period.

In fact, Americans spent five percent more year-over-year on mobile games in 2016 and that number will continue to rise, according to a new report called, “Can’t Stop, Won’t Stop: The 2016 Mobile Games Market.” To further illustrate just how popular “gaming on the go” has become, the report by SuperData Research and Unity Technologies states that Americans play mobile games more often than they watch Netflix, Hulu or YouTube.

Comparing Apples To Robots

Android is the most popular platform for mobile games in every country except the US. Android players were worth eight times more than iOS in China, but for US developers, iOS users generated 45 percent more revenue. While Android gamers represent 78 percent of the global market, iOS continues to yield higher spending overall.

Meanwhile, Asia still represents by far the largest mobile games market in the world, producing $24.8 billion in revenue in 2016—while North America and Europe generated $6.9 billion and $5.7 billion respectively. Indonesia is showing increased potential for brands, experiencing a 192 percent increase in installs in 2016. Spenders also play 84 percent more than the average Indian player, SuperData noted, creating an “undeniable opportunity for developers.”

“Puzzling” Popularity

It’s probably not surprising to learn that 58 percent of gamers play puzzle games, compared to 40 percent who play action games and 26 percent who play simulation games. However, action games represent 30 percent of the share of game installs by genre, while puzzle games represent only 14 percent. While more players are downloading action titles, quick gameplay leads to lower retention—70 percent of the rate that puzzle games do.

A Strong Year For VR

Virtual reality (VR) revenue totaled $1.8 billion in 2016, with 6.3 million devices sold. The top-selling hardware was Samsung Gear VR with 4.5 million devices sold due to “a low barrier to entry as compared to high-price competitors like Oculus.” With nearly a million sales by the end of 2016, Sony’s PlayStation VR was the king of non-mobile headsets.

Restricted to the Pixel phone, Google Daydream headsets sold a little more than a quarter of a million units last year. That is about to change, SuperData predicts.

“2017 will be the year of Daydream,” Stephanie Llamas, VP of research and strategy at SuperData told [a]listdaily. “Samsung gained a healthy market share with its first-mover advantage, but as people upgrade their phones this year, many will be VR-compatible whether that’s what they are looking for or not. Google invested heavily in content from trusted studios and IP, and they’ve carefully planned this release so as to coincide with these new phones. Given recent Samsung phone malfunctions and the lack of universal compatibility for the Gear VR, Google is also benefiting from better PR and awareness.”

According to the report, users engaged with VR more often than they did with games, movies or TV last year. In addition, mobile VR users engaged in 48 sessions per month, while PC and console users engaged in 36 sessions per month. Average sessions were only around 10 minutes at a time across mobile and console/PC, something that SuperData predicts will change over the coming year.

“Short sessions largely have to do with physical and hardware constraints,” Llamas explained. “Aside from motion sickness, smartphones overheat after about a half hour. The most popular VR content also tends to require shorter time commitments, so developers are creating more content that is friendly to these constraints.”

UrbanWorld Music Brings Power Of Hip-Hop To VR

BY Steven Wong

February 1, 2017, 11:43AM

Virtual reality (VR) and hip-hop are merging together with a new partnership between Digital Mind State and social music platform VRTIFY. The result is UrbanWorld Music, the first virtual and augmented reality (AR) channel to focus on hip-hop music and urban entertainment content.

UrbanWorld Music (powered by VRTIFY) is expected to launch in June, and it will take advantage of the perfect marriage of art and technology. Music ranks as one of the most popular content types for VR, since VR is perfect for quick viewing periods—about the average length of a song. Additionally, hip-hop and urban music generate more than $10 billion per year and hip-hop has over 45 million consumers between the ages of 13 and 34, according to a SLMG study cited in a press release.

Mike Johns, CEO of Digital Mind State, describes the channel plainly: It’s “VR meets soul music! UrbanWorld is the first of its kind platform to support hip-hop and urban entertainment content for VR/AR consumption.”

Johns is joined by the founder and CEO of VRTIFY, Facundo Diaz, and the two talk to [a]listdaily about bringing the hip-hop and virtual reality closer together.

How did the partnership to create UrbanWorld Music come together?

[Diaz]: We are a tech company that has developed all of the capabilities to produce and distribute music in immersive technologies. We’ve been working with different artists creating music clips and filming or livestreaming concerts, but we rely on the creativity and the vision from the music industry to take advantage of this amazing technology. It was the right opportunity when Mike brought this idea of a completely new space for urban music creation to us. In this partnership, we are providing the technical tools to bring UrbanWorld Music to life. We are excited about this great opportunity of working with all the UrbanWorld Music team, to re-invent the way Urban Music fans experience and access their favorite music.

What inspired the creation of a hip-hop VR channel?

[Johns]: UrbanWorld was a disrupter during the ringtone days, bringing new revenue streams to a slew of artists who have since remained loyal. Most notable artist we’ve worked with in the past include Oscar award-winning duo, Three Six Mafia, Jerry Springer, Ice Cube and Snoop Dogg. VR and music have made for the perfect mix to resurrect the name UrbanWorld. While movements were being made in both rock and EDM, not much has been done with the integration between VR, hip-hop and urban entertainment content. We are aiming to change that.

In what ways does this music channel differ from what the VRTIFY platform offers?

[Diaz]: This will be the first full concept channel for us. It is much more than an artist or concert section. UrbanWorld Music is a channel that has entity, per se, and will focus on the spirit of urban music in a new and fully immersive way. It will not only include videos, but it will also include shows, interviews, back stage access, additional content and unique experiences.

How will users access the channel? What VR devices will be supported?

[Diaz]: The channel will be available on the UrbanWorld Music website (360 degrees content) and in most known virtual reality platforms: HTC Vive, Oculus, Android and iOS.

How are you getting the word out about UrbanWorld Music?

[Johns]: We are aggressively going after artists and indie labels within our database as well as sourcing emerging talents.

Why do you think music and VR go so well together?

[Diaz]: Music is not only what we hear. Music is a completely sensorial experience. Music allows us to transport ourselves to new worlds, situations and is a state of mind. Virtual Reality and immersive technologies allow us to create new experiences around music. With the UrbanWorld Music channel, we’ll let urban music fans transport themselves to new music experiences, attend concerts right from the stage, experience what a day in the life of their favorite artist looks like, and have access to new kind of immersive shows.

[Johns]: Virtual Reality allows musicians to be creative and to explore the intersection of art and technology. In addition to that, VR is the new frontier to connect with music fans.

Gillette Commits To ESports With Brand Ambassadors

BY John Gaudiosi

February 1, 2017, 09:59AM

Gillette is the latest non-endemic brand to jump into eSports. The company has partnered with ESL to sponsor the League of Legends Intel Extreme Masters (IEM) World Championship in Katowice, Poland from February 24-26, 2017. In addition, Gillette has added its first eSports brand ambassador, Enrique “xPeke” Cedeño, to a roster that includes traditional athletes like Lionel Messi, Neymar Jr., Roger Federer and Clay Matthews.

Francesco Tortora, Gillette global brand director, told [a]listdaily that Gillette has been working with a lot of top athletes for 110 years.

“It used to be baseball, then it expanded to tennis and soccer and football,” Tortora said. “We have to remain relevant with our audience and loyal users. And a big portion of today’s audience watches eSports.”

Enrique “xPeke” Cedeño, pro eSports player and Gillette global brand ambassador

Cedeño told [a]listdaily that it’s a dream-come-true working with a non-endemic company like Gillette in eSports.

“I watch TV and see Federer and other athlete ambassadors of Gillette and it’s huge to now be in that league,” Cedeño said. “It means so much for eSports to have an emblematic brand that has been working with athletes for over 100 years now. Gillette thinks about eSports like traditional sports, and this is good for the entire eSports ecosystem.”

Gillette will be combining its two eSports initiatives at the upcoming IEM Katowice event. Fans will be able to customize Gillette razor handles using 3D printing technology at its RZR MKR Design Studio. Additionally, the brand will provide grooming services to all League of Legend’s competitors throughout the opening weekend and will host autograph sessions and other activities with Cedeño.

The deal with Cedeño is unique because the brand is not going to sponsor Origin, the team he owns. It will be similar to his Red Bull ambassador sponsorship. “I’ll wear Gillette merchandise and be at the booth during Katowice to meet with fans and give away a custom razor that I’ve designed,” Cedeño said.

Cedeño is a former IEM Katowice Most Valuable Player (MVP). This marks the third Katowice tournament he’ll be attending. “I’ve been to many IEMs, but Katowice has always been the biggest in terms of fan interaction,” Cedeño said. “They’re passionate fans there. Every time I go there I can be in a queue for a long time because all of the fans really want to meet me.”

In addition to the RZR MKR Design Studio experience, Gillette will give fans a look inside Cedeño’s life as a pro gamer and team owner. The “Pursuit of Precision” content series will follow him as he visits the Gillette World Shaving Headquarters in Boston to discuss the precision required to be a top eSports player and the added pressures of owning a League of Legends team during the current eSports boom.

Tortora said Gillette chose to work with ESL because it’s the biggest tournament organizer around that gives the brand events that are followed everywhere.

“It’s a live event that a lot of people go to,” Tortora said. “The RZR MKR Design Studio experience is a very simple and effective way to connect a ton of people literally and physically. We’re trying to get them to experience first-hand the connection between the precision and strategy with specific techniques behind the League of Legends game and the precision and strategy that goes into the research and development of our products.”

ESports is the first digital sport, and eSports players open up a unique opportunity for brands to connect. “The reason why all the fans love eSports and follow players like me is because they can directly interact with me,” Cedeño said. “We stream often and we chat with fans and reply to questions; we’re really close to them. Fans can relate to us. They’re able to connect with us in ways that traditional sports don’t offer.”

Tortora said this announcement is just the beginning of Gillette’s eSports activation.

“We have a lot of other content coming both on the Gillette social channel side as well as the ESL, IEM and Xpeke social side in the next few months,” Tortora said.

How Social Networks Are Embracing In-App Shopping

BY H.B. Duran

February 1, 2017, 08:50AM

Social media is predicted to reach 2.5 billion users this year, and a separate study by Demandware estimates that phones will account for 60 percent of eCommerce visits by the end of 2017. With so many turning to their mobile devices to research and share purchasing advice today, it’s no wonder the top social media sites are happy to make that process easier.

Facebook

In 2015, Facebook added the ability to add shops to business pages. Since then, the social media giant has experimented with different, even more convenient, ways for users to shop without ever leaving the app. In addition to being a customer service outlet, Facebook Messenger has become a valuable resource for marketers, with users reaching one billion this past July. Messenger now accepts native payments, opening up possibilities for all-in-one discussion, customer service and booking. For its new payments feature, Facebook is working with a number of companies such as PayPal, Stripe, Visa, MasterCard, Braintree and American Express, which recently launched its own Facebook chat bot. The payment tool allows users to complete purchases in-app without going to an external site. Messenger users can also use credit card information they’ve stored in Messenger to make payments via bots.

A partnership with Fandango last year made it possible to purchase movie tickets directly from a feed, and now users can do the same with other events like museum exhibits and concerts.

Instagram

Facebook-owned Instagram is also trying new ways to discover and purchase products and services through the platform. For paid ads, the site has implemented a full-width, call-to-action (CTA) button below an ad’s photo or video, replacing the overlay behavior and prior CTA design. In addition, Instagram has been experimenting with tags on business profiles that offer product info and prices. From there, a user can choose “Shop Now” to visit the product website outside of the app. “This functionality will bring important product information to the consumer earlier in the journey, all without having to leave the Instagram app to search,” Instagram explained in a blog post.

Pinterest is a unique animal, in that it’s a collection of ideas rather than the usual status updates you’d normally find on social media. Last June, the site unveiled its new Buyable Pins, shopping bag and store that enables users to purchase items directly from the site.

“An amazing 87 percent of Pinterest users have purchased something they found while using the platform,” Ayzenberg stated in its latest Earned Media Value Index Report. “Sharing is also an enormous component on the platform. 80 percent of content posted is a repin from another board, meaning there is a lot of opportunity for brands to get quality content (and the associated calls-to-action) distributed on other boards.”

Speaking at an event in June from the company’s headquarters, Pinterest executive Ben Silbermann explained, “Shopping with Pinterest is meant to be that bridge between getting inspiration and actually making it a part of your life.”

Snapchat

Quick to attract young consumers but late to the monetization party, Snapchat has been hard at work finding new ways to create lasting relationships between brands and would-be shoppers. While sponsored filters and interactive games certainly engage and entertain, there remains a gap between viewing a product and buying it.

The app’s latest efforts include interactive ads on its Discover section—inviting users to swipe up for product mini sites and calls-to-action—which were jump-started by brands Lancome and Target. Sweet, Hearst’s Snapchat channel, has partnered with Everlane to test a new, interactive way to engage shoppers on the platform. A project that appeared on November 8 encouraged Sweet Discover Page visitors to “draw” a monogram on an Everlane bag, then email a saved screenshot of the design to Everlane to purchase. Customers used Snapchat’s text and drawing tools to pick colors and monogram details as opposed to the traditional, drop-down or field selection method.

Ross Clark, vice president and general manager at Sweet, called the channel’s brand of interactive editorial “conversational content” and said it’s an approach Sweet has used to score firsts from brands such as Gucci and Carolina Herrera.

Twitter Says “Bye” To “Buy” Buttons

First appearing in 2014, Twitter’s “Buy” button allowed brands and non-profit organizations to include a call-to-action in its posts, thanks to a partnership with Shopify. Eight months ago, Twitter disbanded its commerce team and announced a new focus on website conversions. Now Shopify members are receiving notices that Twitter will phase out the “Buy” option, although donation buttons will still be offered for charitable causes.

Why Coca-Cola Dove Into ESports

BY John Gaudiosi

February 1, 2017, 07:37AM

As vice president of entertainment, ventures and strategic alliances for The Coca-Cola Company, Matt Wolf has expanded beyond the scope of his original role as the company’s global head of gaming. It was in 2013 that Wolf entered into eSports, making Coke the first non-endemic brand to target the emerging competitive gaming business.

Coke has worked with Riot Games to connect League of Legends fans with the brand, and has extended its eSports sponsorship with Electronic Arts and the FIFA video game franchise. Wolf explains the soft drink maker’s eSports strategy to [a]listdaily in this exclusive interview.

Matt Wolf, Coca-Cola VP of entertainment, ventures and strategic alliances

Why did Coke decide to engage with eSports fans at a time when few non-endemics were?

It’s a natural extension of our brand to celebrate fandom in a number of different forms. In this case, getting close to gamers seemed like natural evolution of that.

How does Coke, as a company, view eSports today?

We see it as an opportunity to reach the consumer in a way that is uniquely special, in that these consumers spend a lot of time in that specific genre. It’s another opportunity to reach a specific consumer set in a way we can’t otherwise. Also, it’s great for us in our ability to innovate our marketing communications and attach our brand to an emerging form of entertainment that we think has a lot of room to grow.

How has Coke been able to apply lessons learned from traditional sports to it eSports offerings?

We had a pretty good head-start heading into eSports because of our experience with traditional sports. The two aren’t that far apart. Our brand is more focused on being in the stands with fans. It’s about fandom and togetherness. We took that experience, and the way we approach traditional sports, and applied it to our eSports programming, but with a twist. We understand the eSports space and how that community interacts. While there’s a lot of crossover, it’s a completely different form of entertainment. And the viewing audience is hyper-connected through social media, another component we take seriously and integrate as seamlessly as possible with our marketing.

What has been the key to Coke’s success in eSports?

We took a fairly organic approach in. We didn’t rush our presence and push too hard at the beginning. It was an evolution. We were on a journey with the game makers, the stars and athletes of the sport, as well as the fans. That allowed us to evolve and grow over the last four years we’ve been in this space. That approach lends to some real authenticity both in how our brand is perceived by the viewing audience and the industry—and also in the way we’re realizing our brand in the space as we continue to build our relationship with the consumer.

What role has social media played in connecting with fans?

Gaming and social media are the same thing—inextricably linked. You can’t do one without the other. ESports broadcasts through a chat platform like Twitch or VOD through YouTube—they all run off social media. Tips and tricks are all happening online. And friends play these games online together, which also constitutes social spread and communication. You can’t have one without the other. When a brand like us comes in, we have a multipronged approach with marketing communication through both the eSports sector and social.

What role has the community played with activations like the cinema viewing parties and how has that grown?

Community is at the center of who we’re trying to reach and what we’re trying to achieve. We typically communicate a lot of eSports marketing work if it’s not at an activation site like Twitter or Facebook. But at the heart of that, it’s not effective unless we’ve generated a community around it. Our Twitter was the fastest growing CPG Twitter account in the world. One of the largest in the Coke company today. We use that community to generate awareness. We listen to what they want. We learn from what they like. It’s an amazing way to get real-time marketing that we can apply to future communications work.

Cinema viewing parties—these people can watch at home for free or with friends, and some do that. But the community, when they come together and experience a live event, it’s all about coming together as groups just like they would when watching [any other] live event in person. They can share that moment together. It’s about fandom and togetherness. We just can’t make that engine run without that community. That community is typically the hardcore eSports community, [and is the] most impassioned about the sport and that game. It’s all about celebration. It’s central to that community.

Matt Wolf is a speaker at the [a]list Summit. Learn everything you need to know to invest in today’s fastest-growing media channel—Competitive Gaming and eSports on 2.16.17 in Los Angeles. Go to alistsummit.com for more info.

Nintendo Places Its Faith In The Switch Console

BY H.B. Duran

February 1, 2017, 06:30AM

Nintendo has released its financial results for the nine-month period ending December 2016, with sales totaling $2.7 billion—a 27 percent decline from 2015. The company’s financial successes have been a roller coaster ride—from selling almost 102 million units of the Wii to just under 14 million units of the Wii U. While sales for the 3DS were up 10 percent, Nintendo needs a big win with its new Switch console.

Pokémon GO might have thrust Nintendo back into the spotlight, but the company doesn’t see all that profit, having only part ownership in the Pokémon Company. Regardless, the app’s popularity led to increased sales of software in the Pokémon franchise and drove Nintendo 3DS family hardware sales growth. Nintendo sold 6.45 million 3DS units worldwide during the quarter (10 percent increase on a year-on-year), while Nintendo 3DS software sales were 46.78 million units (20 percent increase on a year-on-year).

And then there’s Super Mario Run. Nintendo stated in a briefing that Super Mario Run has been downloaded 78 million times on iOS, but only around five percent of players are buying the $10 full version.

“Despite a wide release of Super Mario Run in collaboration with Apple, resulting in 78 million downloads of the free version, the game has only sold only four million copies,” observed SuperData CEO, Joost van Druenen. “This is largely the result of the high price point ($10) in the predominantly free-to-play app store on iOS.”

During Monday’s financial report, Nintendo president, Tatsumi Kimishima announced that the company plans to ramp up Switch production thanks to strong global pre-orders. Initially, Nintendo announced that two million units would be shipped worldwide during the first 30 days of the Switch’s lifespan. However, pre-orders went incredibly fast in North America and Japan, going so far as to overload and crash the official website. “You can tell customers have huge expectations based on how Switch reservations are doing,” said Kimishima. “We want to increase production as much as we can.”

Pre-orders may be a good sign, but experts still remain cautious about certain retail choices. “The news that the Nintendo Switch will launch without any bundled games or even demos is likely to have a negative effect on initial sales,” van Druenen added. “For the current console generation (PlayStation 4, Xbox One), bundling has been an important driver of consumer adoption and a key strategy in the face of weakening title sales at retail.”