David Blecken
Jan 22, 2019

In Japan, Twitch looks beyond the world of gaming

The streaming platform's head of advertising sales discusses the potential for "real-life" content and bringing mainstream brands on board without alienating core users.

Jon Anderson in Tokyo
Jon Anderson in Tokyo

Japan has long been seen as a mecca for gaming, but in one of the country’s many paradoxes, esports and streaming platforms like Amazon-owned Twitch have been slow to take hold. As director of advertising sales for the market, Jon Anderson aims to hasten adoption amid competition from the likes of Openrec, Niconico and YouTube.

Anderson is almost a year into his role after spending around 13 at Xbox Advertising and later Oath in Seattle. An accomplished shamisen player, he is a Japanese culture enthusiast and began his career in Tokyo as a marketer at Panasonic. Looking ahead to the coming 12 months, Campaign asked him to outline the direction Twitch is heading in the market and how advertisers should approach the platform.

Twitch’s mission in Japan

Twitch’s primary reason for being in Japan is the same as everywhere else, Anderson says, which is to “enable our users [the content creators] to make a living doing what they love”. He rolls his eyes in mock disdain at being someone who sells advertising—which has the potential to dilute the content experience—but describes himself as a “monetisation option”. “The ads go to fund these up-and-coming kids or the adults who love the games they play. The more advertising we sell and the more brands that get engaged, the more money we’re making for our content creators, which gets the flywheel going.”

He is unable to disclose how much the average Japanese content creator makes, but points to Tyler Blevins, a US streamer who goes by the moniker “Ninja”, as an example of what is possible: Blevins claims to make upwards of $500,000 a month. “We do have people who make a living off of it” in Japan, Anderson says. Do they make up a big percentage of total streamers? “I can’t say.”

Content: not just about gaming

For Twitch, Japan is where the US was several years ago, Anderson says, meaning the focus is on core gaming content, which still has a long way to go. “The best stuff is the gaming and the more interactive the better,” he notes. “Anything two hours or longer is kind of the sweet spot. Anything shorter and you’re just ramping up until that sweet spot hits.”

But he expects “real-life” content to play an important role in the future, as it has done in more advanced markets. “It’s doubled in Japan in terms of minutes watched in the past year,” he says. “If you like the [gamer’s] personality, you’re curious to see behind the scenes of their lives. You get to see what they do when they’re not just playing video games.”

He also thinks this kind of content has a role to play in Japan’s ongoing push to attract tourists. “You can have one of our gamers who has a built-in audience in the States go visit these locations [such as Hokkaido, for snowboarding], they stream for a couple of hours, and then we do a cut-down that goes up on YouTube as a repository for them. So there’s a sense that we have our core gaming and we have to have that, but at the same time there’s so much interest beyond gaming.”

Finding a place for "non-endemic" brands

Of course, diversifying its base of advertisers is also in Twitch’s interests. Anderson disputes the preconception, highlighted in a recent Bloomberg Businessweek article, that Twitch’s audience is limited to hardcore gamers and therefore relatively unappealing for brands. Still, its reach is not to be sneezed at. The platform claims to have 3 million unique streamers every month and more than 15 million average daily visitors.

Anderson is unable to share audience data specific to Japan, but says the daily average time spent on the platform is 100 minutes. He admits that it “skews very male”—about 80:20—but says: “As the market grows, it’s also the lighter gamers that are coming to the platform. It’s very important for brands to recognise that they’re there.”

Still, at the moment, “pretty much everyone we’re talking to is in the gaming space”, Anderson says. This means that the advertising served “won’t feel irrelevant” and runs less risk of incurring ad blocking among an audience that is notoriously disdainful of commercial messaging. But he says a big goal for 2019 is to bring “non-endemic” brands into the fold. “We need them to grow our business and help our streamers make more money,” he says. “It’s kind of, how do you coach them and how do you get them into an authentic dialogue with our audience. That’s the challenge for this year.”

Home entertainment, food delivery and particularly financial services are sectors that could all be well-received, he thinks. Gamers are “rapidly moving to a world where no one is buying disks anymore, so that means you need a credit card to make those transactions,” he says, but notes that the trend is less evident in Japan at this stage. “It will happen over time… There could be some interesting angles for companies wanting to get a card into someone’s hand.”

Misconceptions and etiquette

Agency people unfamiliar with the gaming space often expect Twitch to produce its own slate of content, but that isn’t how it works, Anderson explains, since that would detract from its central proposition of supporting individual creators. “We’re a service. We don’t have a slate of shows you can sponsor. At the core, it’s just letting people stream content. It’s a case of education.”

Twitch is strict about not letting advertising become a nuisance. The bulk of inventory is full-screen video, with skippable, typically 15 to 30-second pre-roll ads delivered at the beginning of a stream. As a viewer, “once you’re done with that, you’re probably OK,” Anderson says. “The streamers determine where the midroll runs. There are some display ads on the site but they’re few and far between, kind of out of the way. So we really focus on, you’re here to watch gaming video, we’re here to give you a similar video ad that we feel is from a relevant brand, and then once you’re done, you’re done.”

In terms of content, he advises advertisers to pay attention to things like noise level. “People are probably in their office or on the train and they’ve got headphones on. If you shoot an ad across that has the audio turned way up because you’re thinking you’re on TV and have to blare the sound across the room, you’ve just pissed off your consumer and they don’t care what the ad is—all of a sudden they’ve got this thing screaming in their ear. So really think when you’re making your ads for Twitch or for any online video platform about the environment.”

And the shorter the better. “The best performing ads we’ve seen are the ones that truly are 15 to 30 seconds. Don’t drag it out.”

The ecommerce no-brainer

For some brands, influencer marketing might be more effective, although this channel is mostly used by game publishers who have streamers play their products for an average of two hours, but in some cases up to five. Anderson notes that the influencer should be able to play the game reasonably well, otherwise the tie-up is likely to result in poor content and be counterproductive.

Given that Twitch is an Amazon property, it seems only a matter of time before direct links are forged with ecommerce. “There’s a lot of potential for that and we just haven’t unlocked it yet,” says Anderson. “We talk to Amazon to align so the client can see the benefits of brand awareness on Twitch [linked to] purchase activity, so we kind of talk to each other but there’s no linking of data yet. It’s something we’d like to do.”

Priorities for 2019

Anderson’s main interest is, naturally enough, in bringing new brands to Twitch, and especially those that have not ventured into the gaming space before. In Japan, “brands are just starting to dip their toes in the water and will need a lot of hand-holding and education to get comfortable with the idea that they’re actually going to be advertising around gaming content, where I think that ship in the US or Europe has already sailed.”

He notes that in Germany, McDonald’s dropped its deal with the Bundesliga in favour of esports. Such a bold move seems some way off in Japan, which only legalised professional esports a year ago, but the market is an attractive proposition nonetheless. What is Anderson’s revenue target? “I can’t tell you that, but suffice to say 2018 was an ambitious goal and 2019 and 2020 will be even more ambitious.”

Source:
Campaign Japan

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