Spil Games is one of the world’s leading online gaming platforms and the company runs a global network of ad-funded, browser-based games. Headquartered in the Netherlands, Spil Games now have approximately 180 million monthly active users worldwide, and the company believes that developments in HTML5 will enable them to grow that audience further still.
Here Bas Seelen, VP Advertising at Spil Games, discusses the role of programmatic video; how social gaming is faring since Zynga went into decline; and about how social games are being used as branded content.
You now sell all of your inventory programmatically? How has that been going?
Spil Games took the bold step of taking its ad buying process over to an automated process in October 2012 for two reasons: firstly, because a direct sales force couldn’t meet all the requests we have to reach the various parts of our global audience. In Europe alone, we have about six countries that would need individual attention because of language and cultural barriers. And secondly, due to the increasing demand coming from data-driven campaigns, both first-party and third-party. We’d need a team ready 24 hours a day to deal with requests coming from Brazil to San Francisco to Moscow to Amsterdam.
One common misconception we have found is that when you talk about a programmatic approach to your ad sales it makes it sound as though everything is completely automated. This is obviously not the case. You still need people to develop and maintain direct relationships with agencies and marketers. You still need people to handle yield management and make sure the automated parts of the process are working as best as they can. However, what this move has allowed us to do is shift our team to other things, especially when it comes to working with the SSPs.
Until recently the use of automated and real-time bidding has been used by a lot of media channels to get rid of remnant or unsold inventory. However now more publishers, like ourselves, are starting to place higher value reserved placements into exchanges. The advantage here of course is that because of this, prices are improving for RTB, and in certain markets RTB is becoming a big chunk of our overall revenue.
We have never believed in the notion of remnant inventory, and we don’t regard any of our inventory as “sold or unsold”. Everything that we put in the market is premium in our view. And for us, that means being able to package specific types of data within certain formats, and we’re still on a fairly steep learning as we look to continue our developments around RTB.
We recently started automating our rich media ad sales, and this has relieved a lot of pressure when it comes to traffic we’re getting in video. In the past 12 months we’ve seen a 500 percent increase in the amount of video advertising being sold. The plan involves showing a video ad after someone completes a certain portion of a game – say a player finishes a level and wants to go on to the next stage – and that promises advertisers a more engaged consumer.
The combination of being able to more clearly show who’s playing a game, who’s engaged, and being able to target those more easily, will attract more money from the agency trading desks. A lot of the video dollars that are coming online are coming from TV budgets. So the timing of all of these activities feels very right.
So far, for us, the switch to automated has definitely been a success. I think a lot of people shy away from the area of RTB because the concept behind it is so complex. But the reality is that for international online media owners like Spil Games it makes a huge amount of sense.
There was huge buzz around social gaming a few years ago, but the space’s image has been tarnished by Zynga’s decline over the last couple of years. Are Zynga’s problems unique to Zynga or is wider social gaming industry encountering similar problems?
We never comment on the performance of our competitors, but the big growth area now is in casual online gaming.
The total number of people around the globe who play games surpassed 1.2 billion in 2013. With the world population currently standing at 7.1 billion, that means a staggering 17 percent are gamers. Furthermore, the global games market is currently worth $70.4 billion and is expected to grow at 6 percent a year.
As a subset of the overall gaming universe, the online gaming phenomenon has exploded in recent times. Combine this with the increased quality of the online gaming experience, as well as the fact that there are no costs involved, and it’s clear to see why growth in this sector has been so impressive. Indeed, gaming is one of the top online activities across tablet, mobile, and PC platforms. According to Emarketer, when you rank online activities by popularity, gaming comes in just below watching videos and ahead of watching TV and films or listening to the radio.
Not only has the cost of getting online dropped, but the games themselves are free and accessible to everyone. Online games are typically easy to play but are often difficult to master – features which help them appeal to the mass audience.
What type of demographics are you seeing playing games? Are we still seeing lots of female gamers playing casual games?
Ask the question “who is gaming?,” and the answer is an unequivocal: “everyone.”
Today, online gaming has broad demographic appeal. Recent comScore data for nine countries, both established and emerging, reveals good representation for both men and women in all age categories.
Although online gaming penetration consistently ranks highly with men aged 15-24, women aged 35 and over regularly outnumber their male counterparts.
There has been a lot of talk about the rising power of women and mothers within the online gaming sector, and the stats bear this out. In Turkey, Brazil, Netherlands, US, UK, and France, there are more women over 35 gaming than men. In fact, an astonishing 73% of Turkish women aged 35-44 play online games.
Even though men aged 45+ consistently rank as the lowest demographic, in most regions they are still showing 40-50% penetration. Even Dutch men, who appear to be the least interested in gaming, have more than 30% admitting to playing games online.
There is certainly a wide spread of demographic appeal, and we can drill down further to look at the individual types of games that these categories of users are playing.
Research has shown us that tween girls like to explore their future life through role-play. Acting out grown-up situations they recognize from the world around them (for example, pretending to have a job or be a parent) helps them feel independent. Girls also like to be creative, and they like to share their creativity with others. They want to be connected to those around them and to show their friends what they’ve made. The pattern of girls’ playing habits on the Spil Games platforms backs that up, as the top types of games across all regions are: Cooking games, Dress-up games and Pet-caring games.
The nature of these games also shows us that young girls like to share what they have done with others, which helps them to build their confidence in a safe environment.
Many of these games, particularly ‘Sara’s Cooking Class‘, also have a cross-generational appeal, with mums regularly playing them with their daughters for bonding time and for a bit of light entertainment.
Beyond this, adult women tend to play games primarily to break away from their daily routine and at the same time get some mental stimulation. These players tend to prefer puzzle games, quizzes, word games, matching games and mahjong-style games.
Boys meanwhile tend to be much more focused on competition and showing off their high scores than on creativity, with popular choices including: racing games, sports games and action games.
This same mentality ports over to the types of games adult men play, too. Of course, there is always a certain amount of crossover. For example, we know that around 20% of our young female audience also likes to play more male-oriented games. For instance, Thrill Rush – an action game – was a popular game amongst Dutch girls.
Are we seeing many brands creating social games of their own as branded content?
Yes, brands are finding that building their own games can be a great way to engage with their target audiences. For example, even Dutch national air carrier KLM launched its own game, Aviation Empire.
Also online games are getting more intelligent and better looking, furthermore the speed and ease with which a lot of games can be created today means game designers can even react to current news issues. Whether it’s the Edward Snowden leaks game or the Berlusconi Bunga Bunga party game, there’s a real opportunity to do something different and stand out from the crowd. With content marketing playing such a big part in companies’ overall marketing and customer engagement strategies, games can be a crucial part of this.