Alphabet’s (NASDAQ:GOOGL) Google may have missed the social networking boat but it does have some platforms and communities that marketers love. It was this initiative to create online communities and the growth opportunity ($107 billion in 2017, $118 billion in 2018 and 19.6 billion by 2019, according to the Global Games Market Report) that led to the creation of YouTube Gaming.
Asia Pacific (particularly China) was the biggest gaming market in 2015 (47% of gaming revenue); followed by North America (mainly the U.S.) at 26%; Europe, Middle East and Africa at 22%; and Latin America at 4%.
The Entertainment Software Association has reportedly found that 155 million Americans play video games. Nielsen stats are even more specific; the audience measurement firm says that 65% of gamers use a combination of consoles, computers and mobile devices to play games.
But the company isn’t alone in these efforts; in fact its initiative to launch YouTube Gaming came after it dropped out of a bidding war for Twitch. Amazon (NASDAQ:AMZN) went on to buy the gaming site and its community of several million users.
What’s the Deal with Gaming?
Why are these big technology companies trying to get in on the action? Why is there so much hype? And where’s the money?
Initially, online gaming constituted sharing of moves by gamers that other gamers could appreciate and work on. Online channels like YouTube also facilitated the sharing of longer durations of gameplay.
Now the thing about gaming is, it’s just as entertaining to play as it is to watch. You just have to think about the NFL or whatever it is that interests you and you’ll know what I mean! Also, unlike other forms of video, gaming video is very engaging, especially if it’s live, like on TV. So if an online platform enables live streaming, engagement will be even higher.
The YouTube Advantage
YouTube already has a very good advertising platform and it has focused on getting good content creators. Just like on social networks like Facebook (NASDAQ:FB) , a good content creator becomes an “influencer,” drawing crowds quickly and accumulating a large number of followers. This community then becomes a good place to target ads.
Focusing on content creators has helped YouTube Gaming become a leading provider of gaming content. The best part is, Google has the analytics support to monetize this content. According to its own survey, Gaming users also make good consumers and recommenders of other products particularly electronics goods, entertainment content, cars, and food and beverages, thus increasing ROI for advertisers and creating a very healthy environment.
Summing Up
Gaming content is a very good way to draw advertisers and a good percentage of YouTube’s most popular channels are Gaming channels. The success that some creators have seen (like PewDiePie and SkyDoesMinecraft for instance) are likely to draw others to the platform and help it grow ever bigger. Streaming technologies will continue to evolve in the meantime and premium TV content should follow.
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