In the competitive mobile game industry, licensing high-profile IP gives developers a serious edge. That’s why they increasingly partner with entertainment brands to create some of the world’s most popular (and profitable) gaming apps. Still, one particularly promising avenue remains untapped: partnerships with OTT streaming platforms. After all, developers have already seen tremendous success producing apps for shows like South Park, X-Files, and The Walking Dead. Each of these games is massively popular, and that’s before we look at recent hits like Game of Thrones: Conquest.
Many OTT originals now have a cult following. In July of 2019, Netflix subscribers flocked to their streaming devices to watch the third season of Stranger Things. At the same time, fans caught a glimpse of newly-announced licensed app tie-ins, including a Stranger Things 3 game and a standalone AR-inspired RPG, produced by a third-party studio. IP partnerships like these existed for decades, yet the popularity of OTT IP has the potential to elevate this strategy to new heights.
Today, more than ever, users are either consuming OTT content on mobile devices, or using their “second screens” while watching on a 10-foot UI. It’s clear that whatever content is being consumed, OTT viewers and mobile gamers are two market segments with a high degree of overlap. Both developers and streaming platforms stand to benefit enormously from this emerging opportunity.
Netflix has come a long way from its mail-order DVD days — today, it’s a digital powerhouse. In addition to its streaming capabilities, it now maintains an immense database of consumer information and viewing habits. These metrics are analyzed internally by machine learning algorithms to determine which content will hook and retain subscribers. In the context of an IP partnership, that data also creates opportunities for mobile game developers.
Most licensed mobile game projects such as Avengers or Star Wars still rely on IP, brand recognition, and traditional paid user acquisition (UA). If data sharing was included in these license agreements, these apps could be marketed directly to engaged audiences, reducing the need for paid UA. If both parties collaborate to ensure that consumer data privacy is upheld, data sharing could be a major competitive advantage.
Imagine if the Frozen Free Fall game was revamped to enable users to log in with their Disney+ credentials. Players could get in-game bonuses as a reward for linking their accounts. Meanwhile, Disney could then share data and insights with the developer (in this case, Jam City), and vice versa. In such a partnership, app creators would gain access to viewing habits, while the OTT platforms would gain access to their mobile gaming habits. This exchange could unlock immense marketing potential and highlight promising licensing prospects.
Even if customers don’t link their profiles, OTT providers can look up the device IDs for users who register and watch content from smartphones. This grants access to shared metrics that can be used to calculate which cohorts frequently play mobile games, and paid marketing budgets can be adjusted accordingly.
The “Streaming Wars” are now in full swing, as new and legacy entertainment companies vie for control over the future of TV. Mobile game partnerships have the potential to become a strategic advantage as the market consolidates.
Disney’s bid as a streaming service aggregator comes in the form of its Disney+ platform, which launched in November of 2019. The entertainment giant has bundled its own IP with ESPN Plus and ad-supported Hulu. In what is surely no coincidence, Apple launched Apple TV+ on the same timeline. HBO Max also plans to launch its beta in late 2019, which will feature content from a wide range of properties owned by AT&T and Warner Media.
How will games fit into the new bundling model of the OTT ecosystem? Gaming studios are already experimenting with mobile game deployment on OTT devices, specifically the Apple TV. Major titles like Crossy Road and EA’s Real Racing 3 are migrating to the tvOS ecosystem in an attempt to attract OTT viewers to play games. To navigate the tremendous amount of competition, streaming giants may consider leveraging mobile game partnerships as differentiators. These platforms each need to offer something different and exclusive — as media consumption becomes less fragmented, mobile games could be a viable option.
In 2018 alone, Netflix invested $12 billion in original programming. What if this investment extended to partnered IPs in the mobile game space? As the gaming and streaming demographics continue to merge, mobile games may soon be invited to the table.
[Streaming companies] absolutely need to have their own original or exclusive content. Leverage is how they’re going to drive people to a direct-to-consumer product. And when streaming companies offer something that consumers can’t get elsewhere, they increase leverage.
Mobile game partnerships are an untapped opportunity in the OTT space, and a lucrative one at that. They combine the popularity and monetization potential of mobile games with the brand recognition and digital delivery capabilities of OTT original content. We are only just starting to see brands capitalize on these opportunities in 2019, but make no mistake — Stranger Things won’t be the last game based on streaming video content.
If you’re a mobile game developer looking to learn more about ad monetization or branded partnerships, the monetization experts at Tapjoy would love to hear from you. Get in touch and learn how Tapjoy helps mobile game developers maximize ad revenue using premium rewarded ad placements.
Over the past decade, digital marketing has evolved at breakneck speed.
Innovations like artificial intelligence and big data have fundamentally shifted the way retailers interact with customers. Big-box retailers have lost relevance, forcing an unprecedented number of store closures. Meanwhile, digitally native startups are doubling down on their direct to consumer (DTC) marketing strategies. Direct to consumer trends are reshaping retail, and even established brands are paying attention. In fact, Nike reported that its DTC strategy was responsible for 29.6% of its overall revenue in 2017. The brand predicts its DTC sales will grow to $16 billion by 2020.
The direct to consumer trend isn’t disappearing any time soon. In fact, it has catalyzed fundamental changes to the nature of retail, marketing, and customer engagement. DTC marketers have their fingers directly on the pulse of consumers, and this dialogue is shifting consumer expectations. They are asking for personalization, authenticity, and convenience. Here are three direct to consumer trends that are driving big shifts in digital marketing in 2019.
Quantifiable marketing has always been central to DTC strategy, but maturing digital channels, such as social media, aren’t delivering the same ROI that they used to. According to data averaged from various market research studies, 67% of users have not purchased “from” nor directly within social. Impressions simply aren’t translating into customers, and customer acquisition costs are higher than ever. In light of these shifts, DTC marketers now see a bigger impact from emerging channels than existing ones. However, even testing comes with risks — that’s why DTC marketers favor performance marketing. In a performance model, advertisers pay only when they achieve a specified result — not for clicks or impressions.
When marketers are able to measure their Customer Acquisition Cost (CAC) in real-time, they can focus on creating high-value offers to get customers in the door, such as:
While these offers are certainly effective for reducing the friction involved in a purchase, rewarded advertising takes this one step further. Instead of being forced to watch ads, users choose the offers they’re interested in and are able to unlock in-app content in exchange for real conversions. In the rewarded in-app environment, users are engaged and open to trying new products, which results in record-breaking conversion rates and a consistently high number of new customers.
One of the biggest differentiators between DTC brands and traditional retailers is their focus on maintaining relationships with their customers over a lifetime — not just for a one-time sale. Without distributors acting as middlemen, DTC brands don’t need to focus on creating massive quantities of inventory at the lowest cost possible. Instead, they focus on how they can overdeliver for their customers and make sure they are happy and loyal to their brand. Because of this shift in goals, DTC brands are not just selling products online, they’re providing value on a regular basis through recurring subscriptions.
The rise in subscription offerings is one of the most prevalent direct to consumer trends we’re witnessing today. Consumers are always looking for convenience, and subscriptions are the best way to achieve that. Rather than needing to run to the store when you run out of a household product like laundry detergent, subscription services permanently eliminate this type of occurrence. DTC services like FREY, for example, provide a unique line of products to meet every laundry need you could have and automatically ship it to you based on your laundry habits.
Subscriptions aren’t just convenient — they’re highly profitable. This combination of quality and convenience helps DTC brands maximize customer LTV and enables them to offer high-value promotions where you can try out products for as low as $1. They also offer special promotions and free merchandise for loyal customers. The end result? These brands create profitable businesses that customers can’t wait to tell their friends about.
Rather than trying to maximize the margins on an individual sale, today’s DTC brands create a win-win situation for their customers and it’s certainly paying off. This method of consumer engagement is mirrored by the value exchange behind rewarded in-app advertising. Successful app developers no longer need to force as many ads as possible on their loyal users — instead, they’re able to allow users to choose from hundreds of offers and complete an action of their choice to receive rewards. Because advertisers only pay when a specified action is completed it’s a win-win for app developers, mobile gamers, and DTC brands.
According to Fab Dolan, Head of Marketing at Google Canada, “The brands that are winning are the ones that understand and own the fundamental interplay between experiential and transactional.” If direct to consumer trends are any indication, personalized experiences have become a hallmark of modern marketing.
Experiential engagement goes beyond personalized messaging or dayparting. The most successful marketing experiences actually add value to the daily lives of consumers. It can take many forms, including the following:
DTC brands like Function of Beauty and Gainful take customized experiences one-step further by using a personalized quiz as the entry point to the customer journey. Based on their responses, these brands formulate products with a unique blend of ingredients to help them achieve specific results. Unsurprisingly, this personalized approach is highly alluring to modern customers.
Personalized ad experiences are the best way to promote personalized products. This is true both because they showcase the brand’s value up front, and because they generate the most return on ad spend (ROAS). That’s why direct to consumer brands increasingly leverage cost-per-action (CPA) campaigns to target KPIs like quiz completions. These campaigns are especially effective in the rewarded in-app environment, where users are highly engaged and more likely to proceed with the purchase.
Direct to consumer trends have already shifted the digital marketing landscape, and they will continue to do so as more brands embrace the model. However, it’s already clear that consumers want authentic brand experiences. In a society that is increasingly defined by our reliance on technology, this preference for authenticity is meaningful. The future of retail will, undoubtedly, be decided by consumers themselves, as they search for brands that share these values.
For more digital marketing insights, including how DTC brands can drive maximum ROI from their mobile strategy, contact Tapjoy’s mobile advertising experts today.