OnlineAdCritique

CCT356 - Ad Critique

eSports is a new developing market in which new innovative means of advertisement profits are beginning to arise. There are professional gamers all around the world that have been starting to broadcast their live gameplay through simply playing their game, and then streaming it via livestream software and websites, or through videos such as through youtube. These cyber athletes are now generating revenue through people watching their live play, and the companies are also able to advertise to their viewers. There is mutual benefits that do not only extend to just revenue generation for the player, but also the companies host massive from the advertisement revenue from tournaments such as the MLG (Major League Gaming), or IEM.


 * IEM tournament finalists**


 * MLG commentator rallying the fans**

These companies not only advertise to attract viewers by allowing professional popular gamers to stream videos, but also through amateur players who just simply enjoy broadcasting. These players who become popular enough, are allowed to monetize their streams and begin making money by a feature which lets them click a button while they play, and a 30 second advertisementis displayed through all the people on the stream. Obviously the advertisement may be annoying, but players usually deploy these advertisements during interludes between matches and when users just log into the stream.

A few key terms are defined by Kevin Lin, marketing of Twitch.TV, one of the streaming sites

- Ad Opportunity: This is the total number of opportunities a company has available to deliver an Ad Impression. For example, if a channel has 1000 simultaneous viewers and runs 1 commercial, there are 1000 opportunities to show an Ad Impression. Ad Opportunities are also sometimes described as Ad Inventory.

- Ad Impression: This is counted when a viewer *actually* sees an ad. Impressions are always less or equal to opportunities.

Fill-rate: This is Ad Impressions divided by Ad Opportunities. In an ideal world, everyone sells every single Ad Opportunity to someone. This would mean 100% fill-rate. In the real world, because there are other variables like country of viewer, time of day, number of ads seen by a unique viewer, etc. the Fill-rate is always less than 100%.

- CPM - this is cost per 1000 Ad Impressions. So $3 CPM means you earn $3 per 1000 Ad Impressions viewed. It is important to note that it is not $3 per 1000 Ad Opportunities.

- eCPM (Effective CPM) - this is cost per 1000 Ad Opportunities, thus takes Fill-Rate into account. This is a much better measure of how a company is performing in terms of sales. Thus if someone tells you they offer $3 CPM, but has a Fill-rate of 50%, then your eCPM is $1.50. The way you calculate this is revenue divided by every 1000 Ad Opportunities. For example, if you have a $3CPM, 50% Fill-Rate and 1000 Ad Opportunities, this is 500 Ad Impressions. $3CPM x 500 Ad Impressions / 1000 = $1.50 eCPM.

- Frequency Cap - High paying advertisers usually only allow companies to show their ad 1-3 times per day to a unique viewer. This is to prevent over-exposure of their brand and ensure higher performance. Frequency caps can be as low as none (as in they will allow a company to show their ad as many times as possible) or 1 per day. The ones you see over and over are usually the lower paying CPM ads.

One huge problem fans are complaining about are when broadcasters play an advertisement right when theres an exciting thing going on during the stream, such as when the climactic battle of the finals of a large 50 000$ tournament.

Some of the pop-up advertisements and cut scenes, are advertisements by Razer - a gaming peripheral company that benefits greatly from advertising on this medium. Razer sponsors a large number of tournament prizes from these huge tournaments. On streams, players sponsored by Razer (they also sponsor indvidiual players and teams) have overlays on their stream to advertise a logo in one of the corners during a live stream. Since the target audience of the people that watch live gaming, are gamers themselves, it proves very effective. Other companies that market the same way are Asus and NVidia, hardware companies that a large number of gamers use.

Another way for these companies to advertise, is through just sponsoring a tournament themselves, thus the companies adopt a name such as the "ASUS Republic Of Gamers" when the tournament is streamed. The companies put in numerous advertisements, and whenever there is a live feed showing a player. Players are also wearing jerseys plastered with the company's logo and using their products on camera.

Other advertisements that are displayed through cutscenes during a live feed may include companies such as Lavaife which advertises dating options. Whether being effective to geeky gamers or not, I won't go into detail.

One internationally well known streamer and broadcaster known as HuskyStarCraft, talks about eSports in his videos and how it is beginning to develop. [|eSports and Husky]

As HuskyStarcraft says, revenue is what drives the advancement in eSports, and the more adverts get seen by us, the viewers, the more tournaments can expand, grow, and improve. It doesn't take very much from us, just to sit through a 30 second commercial every so often, to see the improvements to these tournaments we love so much. I believe that steps should be taken on both sides to improve eSports as a whole. It is a pretty exciting time for fans of players to be able to see their favourite player play at any time when they have their stream up, and to be able to follow to see their practice sessions, and even communicate with them. At the same time, a new field of monetization for the broadcasters are available which is encouraging for professional athletes and commentators everywhere.

Annotated Bibliography

//Lin, Kevin. Personal interview. 09 Feb. 2012. //

//Team Liquid - StarCraft 2 and Brood War Pro Gaming News //. Web. 09 Feb. 2012. .

//TwitchTV //. Web. 09 Feb. 2012. .

//Own3d // Web. 09 Feb. 2012. .