Advertisers, Watch Your Referrals

Advertisers, Watch Your Referrals

Google

At True Interactive, we use tools such as Google Analytics to monitor and measure everything we do. And doing so includes keeping close tabs on referral traffic. Referral traffic consists of visits that come to your site from sources outside of Google’s search engine. When someone clicks on a hyperlink to go to a new page on a different website, Google Analytics tracks the click as a referral visit to the second site. Referral traffic is a recommendation from one site to visit another — like an assist from one basketball or hockey player to another leading to a score.

Referral traffic helps you understand how people find your website. With good referral data, you can understand, for instance, whether your Facebook or Instagram pages are sending traffic to your site (and how much traffic).

But you need to keep a close watch on how Google Analytics measures referral traffic in order to get a true measure. Recently, for one of our clients, we noticed that Google Analytics was reporting a sharp increase in referral traffic from payment sites such as Affirm and Paypal. When we looked under the hood, we noticed that Google Analytics was giving those payment sites credit as the referring sites for customer transactions.

Now, payment sites are essential for a transaction to occur. They make the web more seamless by making online checkout happen faster. Customers making purchases on ecommerce sites probably don’t even notice when they’re referred to a third-party payment site to complete a purchase. But that doesn’t mean Affirm or Paypal should get credit as the referring site. Affirm ensures the purchase happens easily. But Affirm becomes part of the picture after a customer has decided to make a purchase, not before.

Fortunately, we monitor Google Analytics data closely. We acted quickly by adding the third-party payment sites in question to the referral exclusion list, or a list of domains whose incoming traffic is treated as direct traffic (instead of referral traffic) by Google Analytics. We were able to course-correct quickly enough to ensure that we continue to provide our clients accurate data.

The lessons here:

  • Watch your referral traffic closely.
  • If you find a spike in referrals for third-party payment sites, take a closer look at your referral exclusion list. The payment system might be getting an inordinate amount of credit that another site should be getting credit for.

How closely do you monitor your Google Analytics data?

Contact True Interactive

To succeed with online advertising in 2020, contact True Interactive. Read about some of our client work here.

How Video Ad Standards on Google Chrome Are Changing in 2020

How Video Ad Standards on Google Chrome Are Changing in 2020

Google

Get ready for a world with fewer intrusive video ads.

On February 5, Google announced that video ads deemed to be intrusive will stop appearing on Chrome beginning August 2020. Chrome will stop showing all ads on sites in any country that repeatedly show the following kinds of video ads:

  • Long, non-skippable pre-roll ads or groups of ads longer than 31 seconds that appear before a video and that cannot be skipped within the first 5 seconds.
  • Mid-roll ads of any duration that appear in the middle of a video, interrupting the user’s experience.
  • Image or text ads that appear on top of a playing video and are in the middle 1/3 of the video player window or cover more than 20 percent of the video content.

These restrictions apply to short-form video content defined as eight minutes or less in length.

Why Google Announced a Change

You might be wondering why Google identified those specific ad formats. Google is following recommendations from the Coalition for Better Ads, the organization responsible for the Better Ads Standards that inform companies such as Google on user feedback about ads that work and ads that do not. On February 5, the Coalition for Better Ads announced the recommended changes to video ad formats based on research from 45,000 consumers globally. According to the Coalition for Better Ads:

The research found strong alignment of consumer preferences across countries and regions for the most- and least-preferred online ad experiences, supporting the adoption of a single Better Ads Standard for these environments globally. The Coalition’s Better Ads Standards identify the ad experiences that fall beneath a threshold of consumer acceptability and are most likely to drive consumers to install ad blockers. More than 100,000 consumers have participated to date in the Coalition’s research to develop its set of Better Ads Standards.

As a result, Google said that starting August 5, 2020, Chrome will stop showing such ads on sites. Google also said that it will review YouTube video content for compliance with the standards. In addition, “Similar to the previous Better Ads Standards, we’ll update our product plans across our ad platforms, including YouTube, as a result of this standard, and leverage the research as a tool to help guide product development in the future.”

Note that the standards for short-form video do not apply to other environments like feeds or over-the-top (OTT).

What You Should Do

Change is coming. It’s time to prepare:

  • Per Google, if you operate a website that shows ads, consider reviewing your site status in the Ad Experience Report. This is a tool that helps publishers understand if Chrome has identified any violating ad experiences on your site.
  • Review your YouTube game plan. YouTube will be affected by the blocking of midroll ads but not the other two types identified above.
  • Ask your ad agency how they will ensure that ads they create are compliant.

At True Interactive, we are monitoring this development closely and are well prepared to help our clients thrive in this new environment. We manage video ads all the time and understand how to ensure compliance.

Contact True Interactive

To succeed with online advertising in 2020, contact True Interactive. Read about some of our client work here.

What Comes After the Super Bowl LIV Ads?

What Comes After the Super Bowl LIV Ads?

Advertising

Are you ready for some Super Bowl ads? At this point, Super Bowl advertising has become something like Black Friday: not a single day of activity like it used to be, but a phenomenon that stretches over a period of days. As of this writing, we’re seeing a number of high-profile brands rely on digital to extend the Super Bowl ad experience days and weeks prior to the big game. For example:

  • Porsche has returned to the Super Bowl ad derby for the first time since 1997 with a spot that introduces its new Taycan electric car. Through a 2-minute+ movie, “The Heist,” Porsche depicts the Taycan in an exciting chase shot in Germany, with Porsches flying through Heidelberg and the Black Forest in scenes worthy of James Bond.

  • Budweiser goes for a purpose-driven approach, with an emotional vignette of Americans performing acts of kindness. The spot, “Typical American,” urges, “America, look beyond the labels. You might be surprised by what you find.” Here we see another brand going for a powerful narrative, but without overtly promoting the product in this case.

  • Little Caesars uses storytelling to show that you can do a direct-response Super Bowl ad. Little Caesars’s First-Ever Super Bowl ad promotes delivery with savings of $5 or more versus the competition. But this being the Super Bowl, Little Caesars goes high profile by featuring actor Rainn Wilson in a spot available now.

 

You can see many more Super Bowl ads exploding across the digital world here.

Now here’s the most important question: what comes next after these brands actually run their Super Bowl ads?

Creative Parity

Super Bowl advertisers face the challenge of achieving creative parity, or ensuring that your branding is consistent across all the touch points where consumers encounter an ad.

As I wrote in a Super Bowl related blog post in 2019, what happens after you buy digital or offline media is just as important as buying that space itself — sometimes more important. A 30-second TV ad for Super Bowl LIV costs $5.6 million. That’s why businesses want to maximize the value of Super Bowl ads by sharing them, often through inventive storytelling, well beyond the big game. So, advertisers complement TV ads with video ads, display/remarketing banners, emails, social media pushes, and paid search support (to name a few).

Creative parity is harder to achieve as a brand distributes creative assets online and offline. But it’s essential to embrace creative parity or else all the hard work you put into a Super Bowl ad will be wasted when your audience sees a confusing and completely different message in the content you share on your website or social media.

Creative parity is also about customizing advertising assets across the entire purchase funnel, from top, to middle, to low. For instance, at the top of the funnel, a brand might launch a high-concept Super Bowl ad that raises awareness for a campaign or new product. At the middle of the funnel, a business may share, via retargeting, shorter bursts of content with clear calls to action in order to encourage consumers to take an action such as clicking on a banner ad. At the bottom of the funnel, promotions and call-to-actions really begin to be applied in earnest. In some cases the banners themselves disappear, as in branded paid search, but we are able to use similar language mixed in with specific promos based on the search term a user enters.

You can read a lot more about creative parity in my post, “Why You Should Strive for Creative Parity with Advertising.”

What’s Next for Super Bowl Advertisers?

So, how will Super Bowl LIV advertisers achieve creative parity? Right now, the Super Bowl derby is at the awareness stage, largely through earned, paid, and social media. (Let’s face it: journalists are always looking for content to discuss leading up to the big game. These ads meet that need nicely.) The notable exceptions are Little Caesars, which is using digital to not only raise awareness but also consideration and purchase as it seeks to take a bite out of pizza delivery sales on a huge day for pizza delivery; and Budweiser, which also banks on awareness pre-game to increase sales of its product as people shop for snacks and beverages to enjoy during the game.

In addition, the consumer packaged goods and alcohol brands generally have the strongest opportunities to lead consumers down the purchase funnel after the game, which is why so many flock to the big game with ads. Beverage SodaStream will debut its first Super Bowl ad under its PepsiCo ownership, also creating a hopeful cause-effect. Meanwhile, Planters faces an unexpected disruption of its own Super Bowl plans. The company unveiled a wildly popular “Death of Mr. Peanut” ad days ago, a humorous depiction of the iconic mascot sacrificing his life to save the lives of actors Wesley Snipes and Matt Walsh. Planters had choreographed a narrative about Mr. Peanut that would include a funeral held during the big game itself. But the tragic death of basketball legend Kobe Bryant, his daughter, and seven others in a January 26 helicopter crash compelled Planters to put the ad on pause. Whether Planters decides to re-instate the campaign remains to be seen.

I’ll be watching the days and weeks following Super Bowl LIV to see how well some of these notable brands achieve creative parity.

Contact True Interactive

To achieve creative parity with your online advertising, contact True Interactive. We’re an independent agency that optimizes branded interactions to drive traffic and increase sales.

 

 

What Is the California Consumer Privacy Act (CCPA)? Advertiser Q&A

What Is the California Consumer Privacy Act (CCPA)? Advertiser Q&A

Marketing

The California Consumer Privacy Act (CCPA) takes effect on January 1, 2020. The forthcoming law symbolizes how consumer privacy is increasingly taking center stage among governmental bodies in the United States. Preliminary estimates suggest it will cost businesses $467 million to $16.5 billion to comply in coming years.

At this point, it’s safe to say that every major advertiser is aware of the CCPA. But it’s not always easy to understand exactly what this omnibus legislation is all about. So we’re going to answer some question that we’ve been getting. Check it out – the CCPA might apply to you whether or not you do business in California, so it’s important to understand it:

What Is the CCPA?

The CCPA is new legislation designed to enhance privacy rights of California residents. With a population of nearly 40 million, California is considered a bellwether state. Many privacy experts are watching the CCPA closely because of its potential impact on how privacy is legislated across the United States.

How Does the CCPA Enhance the Privacy Rights of California Residents?

The CCPA grants new rights to California consumers, per the CCPA website:

  • The right to know what personal information is collected, used, shared or sold, both as to the categories and specific pieces of personal information;
  • The right to delete personal information held by businesses and by extension, a business’s service provider;
  • The right to opt-out of sale of personal information. Consumers are able to direct a business that sells personal information to stop selling that information. Children under the age of 16 must provide opt in consent, with a parent or guardian consenting for children under 13.
  • The right to non-discrimination in terms of price or service when a consumer exercises a privacy right under CCPA.

What Does the CCPA Require of Businesses?

In a single sentence: the CCPA imposes requirements on how businesses collect, use, and disclose information about California residents.

But the legislation is dense and difficult to untangle. Per the CCPA website, businesses must fulfill these obligations:

  • Businesses subject to the CCPA must provide notice to consumers at or before data collection.
  • Businesses must create procedures to respond to requests from consumers to opt-out, know, and delete.
    • For requests to opt-out, businesses must provide a “Do Not Sell My Info” link on their website  or mobile app.
  • Businesses must respond to requests from consumers to know, delete, and opt-out within specific timeframes.
    • As proposed by the draft regulations, businesses must treat user-enabled privacy settings that  signal a consumer’s choice to opt-out as a validly submitted opt-out request.
  • Businesses must verify the identity of consumers who make requests to know and to delete, whether or not the consumer maintains a password-protected account with the business.
    • As proposed by the draft regulations, if a business is unable to verify a request, it may deny the request, but must comply to the greatest extent it can. For example, it must treat a request to delete as a request to opt-out.
  • As proposed by the draft regulations, businesses must disclose financial incentives offered in exchange for the retention or sale of a consumer’s personal information and explain how they calculate the value of the personal information. Businesses must also explain how the incentive is permitted under the CCPA.
  • As proposed by the draft regulations, businesses must maintain records of requests and how they responded for 24 months in order to demonstrate their compliance.
    • In addition, businesses that collect, buy, or sell the personal information of more than 4 million consumers have additional record-keeping and training obligations.

In coming months, what’s likely going to happen is that businesses will learn through trial and error. Stay tuned. And learn from the inevitable violations that are bound to make the news.

Who Must Comply with the CCPA?

Companies doing business in California subject to the CCPA if one or more of the following are true:

  • Has gross annual revenues in excess of $25 million.
  • Buys, receives, or sells the personal information of 50,000 or more consumers, households, or devices.
  • Derives 50 percent or more of annual revenues from selling consumers’ personal information.

I’m Not Based in California. Do I Need to Worry about the CCPA?

The conditions stipulated above may indeed apply to you if you are outside California. For instance, if you are buying, receiving, or selling the personal information of 50,000 or more consumers, households, or devices in California, CCPA may apply to you regardless of where you are located. Read this insight for more detail.

What Is the Penalty for Noncompliance?

Businesses may be fined up to $7,500 for violation. Businesses could also face civil damages of up to $750 per violation, per user. The key phrase here is “per user.” A major violation could cost a business millions.

Will More States Enact This Kind of Legislation?

They already are. Nevada has enacted its own version of the CCPA already. Here is more information on how other states are enacting privacy legislation.

How Do I Ensure I Am Compliant?

A number of security firms provide compliance services. Unless you have a strong in-house security team, your best bet is to look for compliance help from a specialist.

Contact True Interactive

To manage advertising online effectively, contact True Interactive. We’re here to help!

Photo by Glenn Carstens-Peters on Unsplash

How the YouTube Masthead Ad Format Connects with Television Audiences

How the YouTube Masthead Ad Format Connects with Television Audiences

YouTube

We’ve blogged about the fact that in an era of connected TV, audiences are increasingly watching content that advertisers can’t sponsor — there are no ads on Netflix (yet), for example. But Google is sensing and responding to this reality, as evidenced by the launch of the YouTube Masthead ad format for TV. Essentially, YouTube is helping brands find a new way to get onto TV screens — and into the hearts and minds of viewers.

What Is YouTube Masthead for TV?

YouTube Masthead formatted for television is a response to changing viewing habits. Audiences can access YouTube on their TV screens, and because YouTube is free, it represents a new frontier for brand advertising. As described in Instapage, “[a] YouTube Masthead is a digital billboard placed on YouTube’s homepage for 24 hours, reaching roughly 60 million people (YouTube receives 1.8 billion users/month).”

The YouTube Masthead doesn’t use search histories to earmark users based on their interests or demographics (note that you can target a country where you would like an ad to be shown, though). The Masthead simply appears right on the network’s homepage, allowing brands to reach consumers as soon as they access the YouTube app on their TV. The Masthead, which takes up some prominent real estate at the top of the screen, best serves brands that have the desire, and the budget, to maximize exposure across a sweeping, non-targeted audience. On its blog, YouTube provides an example from an early tester, Ford.

Why YouTube Masthead?

In adapting the YouTube Masthead ad format for TV, Google is capitalizing on the fact that while consumers may have cut the cord on linear TV, they are still using their televisions to experience streaming platforms like YouTube. According to the Google blog, “daily [television] watch time tops 250 million hours per day.” TV screens are still a powerful place where brands can enjoy maximum exposure.

And YouTube Masthead ads seemingly deliver. According to Instapage, Google and Compete researched the impact of YouTube homepage ads. Their findings demonstrated that users “exposed to a YouTube Masthead were four times more likely to visit the advertiser’s website, search for their brand, or engage with even more of their videos.” And because YouTube’s content is so diverse (everything from baking tutorials to the Coachella music festival streamed live) the consumer base will be large and diverse, as well.

How to Move Forward with Masthead

Given the broad reach of the YouTube Masthead format, advertisers will want to keep a few things in mind before diving in:

  • Even though Masthead ads are not targeted, it’s important to remember who is drawn to YouTube in the first place. Know the platform: what videos are trending, for example. Remember that YouTube has a strong focus on entertainment. Is your product a good fit for the typical YouTube consumer?
  • Avoid inside jokes for a specific group. You don’t want your ad to be so broad that it’s boring, of course, but keep it accessible to the large audience you’ll be reaching.
  • You want to stir curiosity with your ad. But remember, given the wide-ranging audience, not all viewers will be inclined to buy. Learn about the features YouTube Masthead makes available — from videos to social shares — and offer consumers different ways to explore your brand, depending on their level of interest or engagement.

Contact True Interactive

Curious as to whether YouTube Masthead is a good fit for your brand? Wondering if there are other ways you can leverage television viewership in this era of connected TV? Contact us. We can help.

YouTube’s New Verification Policy: Advertiser Q&A

YouTube’s New Verification Policy: Advertiser Q&A

YouTube

YouTube has been fighting a credibility problem for quite some time. As I’ve been discussing on our blog, YouTube has struggled to keep its platform safe for advertisers. For example, YouTube’s reputation recently took a hit when businesses such as Disney and Nestle pulled their ads from the platform after a concerned YouTuber called attention to the number of predatory comments and videos targeting children. In response, YouTube terminated more than 400 channels and tens of millions of comments and then announced that it would ban comments completely for most videos of kids. YouTube is constantly in reactive mode, responding to a firestorm until a new one erupts. But YouTube is also trying to be more proactive, as witnessed by a new development: YouTube is changing its verification program for creators to make it harder for channels to earn a checkmark beside their name.

Initially YouTube also told content creators it would remove verification badges from people who don’t meet a stricter criteria to be verified. In doing so, YouTube created an enormous backlash among content creators, causing YouTube to quickly modify its approach. In the wake of the announcement and subsequent backpedaling, I can see why advertisers might be confused. Here’s what you need to know:

What Did YouTube Announce about Content Creation?

Google is changing the criteria by which a content creator can get a verification badge for their channel. On September 19, on its Creator Blog, YouTube wrote (in a post that was later amended),  “We’ve updated the eligibility criteria for verification badges on YouTube. This change is to help viewers distinguish the official channel of a creator, celebrity, or brand. In the next weeks, verified channels will also get a new look. As a result of these changes, some channels that already have the verification badge will no longer meet the criteria to be verified. These channels received an email from YouTube with additional details.”

The changes were to take effect in October.

Why Is Verification Important?

For content creators, getting a verification badge next to their names is a big deal. As Google notes, if a channel has been verified, it’s the official channel of a creator, artist, company, or public figure on YouTube. Verified channels help distinguish official channels from other channels with similar names on YouTube.

Getting verified does not mean YouTube endorses your content, but it helps you with credibility and visibility. According to The Verge, “Being verified also represents status for creators. Having the checkmark beside their channel name is a sign of being one of the most prominent members of the community.”

How Is Verification Changing?

YouTube is going to make it tougher for a content creator to get the verification badge next to their name. Under YouTube’s current eligibility requirements, channels with more than 100,000 subscribers can be verified regardless of need for proof of authenticity. But as YouTube noted on its blog, “That worked well when YouTube was smaller, but as YouTube has grown and the ecosystem has become more complex, we needed a new way to verify the identity of channels and help users find the official channel they’re looking for.”

So, YouTube is instituting some more stringent requirements to get verified, along these lines:

  • Authenticity: Does this channel belong to the real creator, artist, public figure, or company it claims to represent?
  • Prominence: Does this channel represent a well-known or highly searched creator, artist, public figure, or company? Is this channel widely recognized outside of YouTube and have a strong presence online? Is this a popular channel that has a very similar name to many other channels?

YouTube notified a number of creators that their channels would lose verification status in October. The New York Times reported that YouTube had already sent emails to many content creators with the following message:

We’re writing to let you know that we’re updating the eligibility criteria for channel verification on YouTube. Unfortunately, with these changes, your channel no longer meets the criteria to be verified. We realize this might be disappointing, but we believe these updates will make channel verification more consistent for users and creators across YouTube.

Others received messages that their accounts would remain verified.

Why Is YouTube Changing its Verification Requirement?

YouTube wants to be more careful about how its algorithm recommends authentic video content from respected and high-profile content creators. YouTube has faced widespread criticism (including this highly cited article from The New York Times) that its algorithm recommends harmful content from extremists groups. YouTube has struggled to overcome a reputation for being a poorly moderated community – akin to being a town where a smelly garbage dump resides alongside a sparkling water park due to poor zoning and management. And advertisers don’t want their content in view of a garbage dump.

What Was the Fall-Out from the Verification Change?

Many content creators expressed outraged, as evidenced by this tweet from Kiwiz, an account with 2.34 million subscribers:

The New York Times reported many more howls of protests from content creators. Why, they asked, was YouTube pulling out the rug from beneath them after they had worked so hard to build their followings? Why was YouTube punishing individual artists?

As Caryn Marjorie Jones (CutieCaryn on YouTube) told The New York Times, “It’s just a little sign but it’s something I’ve worked years to get and to develop this fan base, so for it to be taken off was alarming and hurtful and I feel really emotionally impacted . . . I used my verification to set myself aside from everyone else. This could impact my business. Either people won’t think I’m legitimate or they won’t see me in the light they saw before. It will definitely affect my brand deals.”

As the impact of the new verification process became more widely felt, YouTube backed down on the evening of September 20. In a tweet, YouTube CEO Susan Wojcicki said, “We heard loud & clear how much the badge means to you. Channels that currently have verification will now keep it without appeal. We’ll continue reviewing those channels to ensure we’re protecting creators from impersonation.”

What Happens Next?

The process of getting YouTube verification is definitely going to get tougher.  The more stringent process will probably have more of an impact on lesser known creators, such as micro-influencers. YouTube suggests that unverified creators do the following:

  • Use a high quality image for your channel icon to make your channel look professional in search results.

Brands and artists with large YouTube followings, though, will benefit because presumably the more stringent verification process means fewer micro-influencers getting visibility.

What You Should Do

Although the more stringent verification is supposed to protect YouTube’s integrity, advertisers should still watch this development closer and hold YouTube accountable. Over time, your YouTube rep should be able to give you tangible examples of how the change has made YouTube a better home for advertisers. But be patient. Don’t assume the new program will have immediate results.

Consider also how the more stringent verification policy will affect your relationship with micro-influencers on YouTube. If you rely on micro-influencers to build your brand, be aware that some perfectly fine and appropriate micro-influencers might be flying under your radar screen even though they fail to meet the new criterion for getting a verification badge going forward.

Also, understand how YouTube will adapt its badging approach come 2020, which YouTube discusses here (basically, YouTube will distinguish between artists and content creators).

As always with the dynamic world of Google and its many brands, change is a constant. Be vigilant. Hold Google accountable. But realize you’ll need time to assess the impact of a change like this one.

Contact True Interactive

For help with your digital advertising, contact True Interactive. We have extensive experience advertising across the digital world, including Google’s vast ecosystem.

What Is Stadia?: Advertiser Q&A

What Is Stadia?: Advertiser Q&A

Google

Over the last decade, streaming has become one of the most disruptive forces media, changing the way we experience everything from movies to music. Now Google, with a new cloud-based gaming platform called Stadia, hopes to use streaming to irrevocably shape the way we play. Here are answers to questions you may have about it.

What Is Stadia?

Stadia is Google’s new cloud-based gaming service that will be accessible through multiple mobile devices including PCs, laptops, smartphones, and smart televisions and tablets. Instead of purchasing a game at a brick-and-mortar store or downloading a title on their console, gamers will simply stream the games running on Google’s cloud servers. As announced at Google Stadia Connect and Gamescom 2019 in August, the catalog currently includes 39 games ranging from Cyberpunk 2077 to Mortal Kombat 11, Attack on Titan 2: Final Battle, and Kine.

According to John Justice, VP of product for Google Stadia, the goal is to bring “all the games you’d expect to have” to Stadia, as well as games “only possible in the cloud.” Games are streamed from Google’s constantly upgraded servers, which means players don’t have to monitor (or wait for) downloads or updates.

And the platform is meant to allow for the multiple ways gamers play. As Google VP Phil Harrison told Eurogamer, “[The word ‘Stadia’ is] the plural of stadiums . . . A stadium is a place where you can have, obviously, sports, but it’s also a place where you can have entertainment. And so we wanted that to be our brand idea, which was a place for all the ways that we play and this idea of watching, playing, participating . . . where you could take a slightly ‘lean-back’ view of a game [if you wanted to]. You don’t necessarily have to be leaning into every last button press per second of a game.”

When Does Stadia Go Live?

Google Stadia’s Founder’s Edition will be released in November 2019 in 14 territories including the United States, UK, and Canada. Those who opt for the Founder’s Edition will drop $130—less than the price of a new PS4—for a Chromecast Ultra and a limited-edition “Night Blue” controller. These early adopters will receive not only the hardware, but also three months of free premium service (called “Stadia Pro”—more details below). They’ll also receive a three-month “Buddy Pass” so that a friend can also enjoy Stadia Pro.

Why Is Google Interested in Gaming?

A shift into the video game business may seem like a big move for Google, but gaming is a lucrative industry. According to market analysis firm Newzoo, the video game industry produced roughly $135 billion in sales in 2018. GlobalData predicts that number will balloon to $300 billion by 2025.

Who Is Google Competing against with Stadia?

As far as game streaming is concerned, Google isn’t the only company exploring this new frontier. Microsoft is in the midst of planning its own offering, called xCloud. Twitch is a well-known and popular platform owned by Amazon subsidiary Twitch Interactive and introduced in 2011, which focuses on video game live streaming.  And Playstation Now, from Sony, allows PlayStation owners to instantly access a library of (mostly older) games for $99 a year, even as Sony promises to take that service “to the next level later this year.” Meanwhile, Apple will launch its own subscription gaming service, Arcade, September 19.

How Will Google Make Money off Stadia?

Although Stadia has been predicted to be the “Netflix of games,” the analogy isn’t a perfect one: Stadia is not primarily a subscription service. Gamers should expect to purchase, not rent, the games they play using the service (with the exception of some free releases). As Google’s director of games Jack Buser told The Verge, “We will sell these games like any other digital storefront.”

The service itself comes in two tiers:

  • Players can get Google Stadia for free via Stadia Base, which is due out in 2020 and will allow streaming of purchased games with stereo sound. The catch? Gamers won’t have access to free game releases when they occur.
  • To get all features, including 5.1 surround sound and access to the free game library, users will pay $10/month for Stadia Pro.

What we no one knows yet is what kind of advertising opportunities might exist with Stadia. Knowing Google, the company will figure out an ad model to support its online advertising business, which is fending off the rising popularity of Amazon Advertising and long-standing competitor Facebook. Stay tuned.

Contact True Interactive

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