GDC 2014: AdMob, a Platform to Build Your Gaming App Business


I’m Jonathan Alferness. I lead up our mobile display
ads products at Google, and I have Russ
Ketchum with me here. Russ is on the Google
Analytics team. We’ve been doing an
awful lot of work across Google to make
game development as easy as possible for all of you. You’ve heard of a
lot of great things already about how
we’re taking a lot of the mundane, everyday
work out of what you’re doing, trying to
enable all of you guys to focus on what’s
really important, right? Creating these amazing games
and getting them out there. We’re going to spend
the next 30 minutes or so talking about
some of the advancements that we’re delivering in
AdMob across a whole variety of different tools to, again,
minimize the pain that you guys have to deal with
in terms of monetizing your applications. An awful lot to talk about,
so let’s get started. So AdMob and game developers
goes back a long, long time. I’ve been working with AdMob
for the last three years or so, Google has owned AdMob
for the last four years, but going even further
back than that, AdMob and game
developers have had a long-lasting relationship. The other thing
that’s really nice here is that advertisers love
reaching out and engaging with users in these types
of environments, right? You guys build
these amazing games, you know how immersed
these users are. And advertisers having
access to this audience has really been a great
partnership as well. Over the course of
the last few years, in general, we’ve been
delivering about 50% of the revenue generated
through AdMob, through Google’s in-app advertising suite has
flown to game developers. So that’s a phenomenal
way that game developers have been able to
continue to monetize, to continue to create these
phenomenal experiences. But we’re all here talking today
because this industry keeps marching forward, and
it keeps changing out from underneath us, right? And in fact, even though by the
end of this year, more than $18 billion will flow through
mobile advertising systems, we understand that the mobile
app and the game economy is changing as we speak. In fact, Bob was up
here and talked us through example, example,
example, about how all of this is changing right out
from underneath us. Let’s talk about at
least three factors here that we’re adapting to
at Google and at AdMob. The first is users. Users are clearly voting
with their fingers. These are touch devices
after all, so that works. And in fact, Bob’s
example showing you where we went from a
$0.99 game to a free game with in-app purchase, and
how that spiked installs, is a great example for
how users are voting. Users are voting to actually
download and install free games– freemium
games– well more than they are premium games. That’s the first shift that
we’re seeing in the market. The second is from a
revenue perspective. Anybody out there who’s
employing in-app purchases in their games
understands this, right? The amount of revenue
that’s being generated through in-game
purchases is soaring. And this has come on rather
quickly, and in some extremes, it’s making up as
much as 90% or more of a game developer’s revenue. That’s a very important
fact, and we’re going to come back
to that in a second. And the third thing
is developers. I remember when I first took on
the AdMob business at Google, and I was rather
surprised whenever I would talk to my
publishers or my advertisers. It was all about, just
get me as many installs as you possibly
can, I don’t care. Get me as many installs
as you possibly can, as cheap as humanly possible. And here I’m scratching
my head, having worked on online advertising
my whole life, and said, well, but doesn’t it matter what
kind of users you install? I mean, after all, you want
to get value out of the users that you’re paying to install. And that has been a
fundamental shift, I’d say, in the last two years. The shades have been pulled
back from people’s eyes. And as developers,
you all understand that it’s the types of
users that you acquire that are fundamental to
the types of experiences that you build, and how
well that game can monetize. We’re going to talk a lot
about that user’s piece as well as we keep
moving forward. So we’ve invested a ton
in this ecosystem already, but it’s just the beginning. So again in 2010,
Google acquired AdMob. It took us a little
while, but by 2012, we had already plugged all of
those AdMob app developers– largely game developers–
into the vast, million plus advertisers that we have
on the AdWords platform. And we continued
these integrations over the last couple
of years as well, so that AdMob is now an integral
part of the Google advertising ecosystem with AdWords, with
our display ads products. And at the end of last
year, at the end of 2013, we re-launched the AdMob
publisher platform, now sitting on top of Google
hardware, Google software, and Google data centers. And it has opened up
the door so that we can continue to innovate
and produce and create more tools for you
guys, moving forward. It’s nice to sort of think
that a lot of this mundane work is behind me and the team. Now that we’re on
these platforms, we can innovate
even more quickly. So we’re going to talk
you through the future. 2014 is where we’re
starting to release some of these new features. We’re going to talk
more about those now. But you can think about AdMob
as being the app developer platform across Google. Where we’re going to connect you
not just to monetization tools, but to all of the
tools that you guys need to succeed as
game developers. Again, we’re trying to take as
much of this work away from you guys as possible– you’re
certainly welcome to do it if you’d like– so that you can
focus on creating these truly phenomenal games. So we’re going to talk about
three specific areas here. And this lines up– at
least it should line up– with what we’re seeing in
the industry right now. The first is how important it
is to understand your audience. We’re going to give
you tools to do this. A lot of this comes
back to the fact that different users engage in
your games in different ways. Understanding the
value of your users is critical to being able to
optimize those experiences. And it’s also
critical to understand how to segment your audience
into individual populations such that you can take different
action on those populations. Because of the importance
of in-app revenue, we’re doing a ton to
help you guys focus, and maximize, and grow
this in-app revenue. And it depends on understanding
who those users are, and these two features are
going to be very nicely coupled together. And last, it is all
about maximizing revenue across the spectrum. You guys want to
make sure you’re not leaving any money on the table. Such that you can continue
to pour these resources back into developing great games. And we’re going to talk you
through how to do that, not just with Google demand sources,
but also across a variety of third party ad
networks as well. So at Google we’ve
been working hard, not just on the AdMob team, but
with a whole suite of partners. Most importantly, with our
Google Analytics friends and partners, to do a truly
phenomenal integration. I’d like to bring
Russell Ketchum up on stage to talk us
through that first piece. Russ, why don’t you come on up? [APPLAUSE] RUSSELL KETCHUM:
Thanks Jonathan. So yeah. As Jonathan just introduced
me, I’m Russ Ketchum. I’m the lead product manager
for Google Analytics for apps, and also Google Tag Manager. But I’m here with
the AdMob team today, because I get to really
announce something that both of our teams
are really excited about and that we’ve had to be quiet
about for a little too long. So today I get to take the
wraps off a new version of AdMob that we’re going to be rolling
out here in the next couple weeks, that introduces Google
Analytics and AdMob as one seamless experience. So the result is, we’re
committing to AdMob becoming this single
destination at Google for cross-platform developers,
monetization, promotion, and now analytics needs. So something I want to
just kind of highlight, right from the
beginning, is this isn’t a light-weight
version of Google Analytics, or a handful of reports. This is everything
that Google Analytics has built for app developers,
fully available inside AdMob. If you’re already one of
the developers using AdMob– or I’m sorry, using
Google Analytics– we have hundreds of thousands of
apps on both iOS and Android who are doing it– this
is your new best place to access your Google
Analytics data. And so why are we doing this? It’s not just about making
reports easier to get to. I mean, of course, that’s nice. But it’s actually
not just something that’s a nice-to-have for
developers at this point, it’s a requirement. You need to have
your rich in-app user data at your fingertips
at all times. So you need to be
able to quickly glean insights about your users, and
then take action about them. And so that’s why Google
Analytics is now in AdMob. So I want to
highlight just the tip of the iceberg and
some functionality that I’m going to
preview now, we’re going to hear more
about it from Jonathan, and then we have two
different sessions on Google Analytics this afternoon,
starting at 2:30, that I would invite
everybody to come back to, that really goes into detail. But as a preview, what we’re
looking to do with Google Analytics can be seen through
our user segmentation engine– our audience
segmentation engine. So Google Analytics has
incredibly robust segmentation ability. In fact, you can create
over a thousand segments for an individual app. And when you do that, you can
fully describe your user base. You can compare one group
of users to another, you can see what
makes them similar, what makes them different, and
really what makes them tick. And what you want
to do, is you want to use this data to take
action when it matters. And like I said, we’ve
got a bunch of stuff we’ll be previewing
this afternoon that shows you how to do that. But for now, I want
to really stress how easy it is for
you to get going with Google Analytics in AdMob. So I’m going to jump to just
a series of slides that talks as through that. So just to get
everybody oriented, this is what AdMob
looks like today. And you can see the three main
tabs there across the top. Where you have Home,
Monetize, and Promote. So in just a few
weeks, we’re going to be unveiling the Analyze tab. And so this is really the
face of Google Analytics inside AdMob. And so what I’m
going to do is just step you through the
process to get started with Analytics for
the first time. So there’s two ways,
I can start either just by clicking
on the Analyze tab, or that promotional
message you’re seeing there at the top right,
and once I do– and once the screen
changes, there we go– I’m taken to
the sign-up page. We’ve taken the entire
Google Analytics sign-up and have reduced
it to two steps. So all of the key informations
here– Google Analytics is really well known for its
data-sharing policies, the fact that we give developers
ownership of their data, and they can choose then to
share that back with Google at different features–
that’s all here. If you’re using Google
Analytics already, you can go ahead and link to
an existing account right here. But if you’re not,
with just one click, you can go ahead and accept
the terms of service, and you get a quick
set of instructions about what to do next. And it’s really quick,
it’s really just one line. Once you continue, you
land on this next page. And this is the
app set-up screen. This gives you
everything you need to use Google Analytics in
your app from one screen. You see it automatically
the first time and it’s always available
from our left nav from that point forward. So from here you can
download the SDKs, you can download our
easy-to-use developer guides, and of course, your
tracking IDs that you’re going to use in your
individual apps. And with that
information, you can start monitoring
your in-app user behavior in about five minutes. That’s how quick it is to get
going with the Google Analytics SDKs. So once I’ve done that, this
is really the heart of it. So this is Google Analytics
reporting inside AdMob. From this point
forward, whenever I click the Analyze tab,
I’m taken right here. At the top left, you
have an app picker. I mean, Google Analytics is a
very robust digital analytics platform, you can
track websites, you can track really
anything thanks to our universal
analytics platform. But with this, we’re putting
the focus entirely on apps. So that drop down menu
you can kind of make out of the top left, that gives
you all of your AdMob apps. And you can easily just
switch from one to another. There’s also a brand-new feature
for Google Analytics in here, as well, that allows you to
report across all of your apps. And that reporting,
that set-up, is all taken care of automatically
just through that process I stepped through. So here we’re looking at
our app overview report. This is the basic view
in Google Analytics. There’s literally dozens
and dozens of other reports there in the side nav. I’m not going to go
through them now, but that’s what we have the
sessions for later today. So to bring it back full
circle, we find ourselves back on the AdMob Home tab. So Analyze is here,
and you’ll notice at the left, where there
was a promotional message, and there were only two
columns of metrics below it, we’re now seeing all of our
key Google Analytics metrics brought together in
one single place. It’s a true cross
product and cross-app dashboard for the first time. And we’re pretty excited. You guys excited? You guys sound lukewarm, but
we’re going to get you there. So I’m going to invite
Jonathan back up to actually talk
about how we can start using some of this
data in context. Thanks. JONATHAN ALFERNESS: Thanks Russ. That was awesome, man. This is great,
we’ve been excited about this for a long time. And again, it’s about a
comprehensive package. It’s not just about
monetizing across the board, and making everything feel
the same for all users. What we’ve learned
at Google, what I know you guys know
as well, is that it’s really critical to understand
these users at the user level, right? Break them into buckets. Break them into
audiences, and be able to do things
differently with that. Google Analytics takes us
so far in that direction and I am sure that
you guys are going to unlock all kinds of
magic with this integration. We couldn’t be more
excited about what we’re talking about here today. Let’s move on. Let’s talk about that the
next big announcement. And that forms around
in-app purchase. There’s a conundrum here. There’s a problem. And you’ll see the
lead-in and why analytics is so important in
a second, right? Anybody who has in-app
purchases in a game, understands that the
vast majority of users are not paying for
these purchases. It’s rather odd, it’s
a very small percentage of users who likes to purchase
these elements in games. We ran a survey that
said about, well, 15% of users across
games, broadly, are the users who are
actually purchasing in-game. We’ve certainly seen stats
and examples where that 15% looks huge, where some games
it’s as small as a percent, or even less than
a percent of users, who are not only the only users
making these in-app purchases, but if you go back to the
amount of volume and revenue that’s coming through
in-app purchases. Those tiny slices of users
are the primary monetization vehicles for these applications. So you’ve got maybe 5,
10, 15% of your users who you want to be able
to show in-app purchases, because they will engage. But what do you
do with the rest? What do you do it the
other 85, 90, 99% of users? Well, I think the
industry norm– we have lots of examples like
this– you segment your users. For those users who are going to
engage in an in-app purchases, it’s quite a good
experience for them. Show them in-app promotions. But for the remaining
segment of users, it’s sort of their
responsibility to help you guys
monetize, as well. After all, they’re playing
this game for free as well. And typically, what folks
have been doing more and more is they’ve been segmenting. So that larger chunk
of users ends up seeing in-game ads–
advertisements. And the world is working hard
at making the ads that show up inside games, inside
applications, much, much better. We’ll talk a little bit about
what we’re doing at Google. But think app promo, think
promotions for other games, and things like that as well. Things that can actually be
very useful to those users. So what we’re announcing here
is the ability to do this. Not just the segmentation
that Russ was talking about, but the ability to act on that
segmentation inside AdMob. it’s pretty fricking
cool, right? So you’ll be able to
segment these users, use business logic to help
understand the buckets, and then figure out
what you’re going to do, and what you’re going
to serve to each user. Let’s walk you
through an example. So first and foremost,
you need to find a way to define who your “special”
or premium users are. And with Google Analytics, as
Russ just talked us through, this is a piece of cake. But we want to make it
easy, no matter what you do. So you can even do some
of this basic segmentation through AdMob alone. In this case, we’re going
to find our premium users, and we’re going to define these
premium users as folks who’ve played the game in
the last 24 hours, folks who’ve purchased in
the past– you know they have a propensity to purchase
again– and in this case, they’re stuck on level 10. Well there’s a great
opportunity to put a purchase in front of this user. So let’s talk about how
we’d actually do that. So the first thing that you
do is, once you’ve actually segmented your users as I said
before, the user’s playing the game, the user’s going
to run into this fail mode, again, this is level
10, they’ve failed, they couldn’t get through it. Now what do you do? Now you use our in-app
purchase tools inside AdMob to sell them the
item– in this case, we love our exploding
pixies– they’ll blow up all the blocks on the
board on level 10, and you’ll get through this. And you’ll also
make a lovely $1.99 from these users
who’ve already been shown to engage on these
in-app purchases in the past. Great. So what do I do with
the rest of my users? OK, well, they’re going
to play the game as well. In this case, they fail. Could be anywhere, but in
this case it’s level 10. And we know that they don’t
have that tendency to buy, so these guys have
been segmented into the other bucket. And again, the in-app
purchase tools inside AdMob allow us to show them ads. Big, bold, beautiful–
in this case, it’s an app promotion ad– it’s
an interstitial, much like we showed in the previous case. For those of you out
there who don’t know, interstitials really seem to be
growing, not just in popularity with developers, like all
of you, but in popularity with users as well. At first, it seems a little
bit counterintuitive. Well shit, this ad’s an awful
lot bigger than a banner ad, how can users actually
like this experience more? Well, banner ads tend to be
in the midst of game play. They tend to distract
users from what they might be seeing as they’re
immersed in these experiences. Interstitial ads line up very
similar to what we’ve all grown accustomed
to with television. I watch 15 minutes
of television– and if I don’t have
TiVo– I sit there and I watch about three
minutes of commercial and then I go back to
the television, right? Commercials are,
frankly, interstitials and the nice thing
about it in-game, and in-app is that
you can choose where the interstitials show up. So you can interrupt the
user at an appropriate time, at this point, at
the end of the level. OK, if the user doesn’t care
about this particular ad, it is no problem for her to
simply close the interstitial, but if they do, it’s the right
time for an interruption. I just wanted to make sure I did
a shout-out for interstitials. Because we’re pretty
excited about this, both from a revenue perspective,
but also from a user quality perspective. So that’s our in-app
purchase work. And we’re really excited,
again, to give you guys the building blocks,
the frameworks that you need, so that you don’t have to build
this logic inside your apps, inside your games. Let us do this
hard work for you. OK, how many of you out
there actually do show ads in your games? In-game advertising? Advertising? Yeah. Yeah. OK. So there’s some of you. There’s some others
who won’t admit it. How many of those, who have
their hands up, actually use more than a
single demand source? More than one ad network? Yeah, yeah. Just about all of you. You know this problem. And my guess is, you know
this problem very, very well. All the different ad networks
that you’re bringing in, they perform differently. And unfortunately, it’s not like
they just perform differently and then they maintain
that constant performance across time. That would make
life way too easy. These ad networks
perform differently given time of day, day of week,
geography, et cetera. And if you’re doing
everything that you possibly can to make sure that
your monetizing in full, you’re constantly tweaking
this stack rank, the mediation, the waterfall of all these
different ad networks. And if you’re
really smart, you’ve got different setups for
different geographies, different setups for different
games, god, I don’t know, different setups for
different times of the week. It sounds like too much work. Especially to us at Google,
who’ve gotten really, really good at being able
to automate this stuff and maximize revenue. So the next feature that
we’re announcing today, is a substantial step to improve
the efficiency of ad network optimization. Inside AdMob, we’ll have a
new ad network optimization feature. And what we’re doing
is we’re continuing to work with these
third party ad networks. We understand that
you’re getting different types of demand
through different networks around the world. That the app economy
has not yet converged on things like ad exchanges
the way the desktop world has. So we’re embracing
this, but we’re trying to do this in
a much smarter way. We’ve built a ton of
plug-ins, adapters, APIs, so that we can go
and we can pull data from these third party ad
networks as close to real time as possible, while
balancing and managing the trade-offs between our
systems and the ad network systems. But this gives us the ability to
constantly reorder and re-stack this rank of ad networks
based on the trends that we’re seeing. And if you think
into the future, Google’s awfully good at
using machine learning to be able to predict trends. So we’re working on bringing
that predictability into our ad network optimization
algorithms, as well. So this is great, and given that
I have a number of static ad networks that I’m
pulling in demand from, at least my computer
science brain tells me, this is about as
optimal as I can get, until I go through
a single exchange. Except there’s one other piece,
which is Google’s demand. So Google has demand coming in
through AdWords, third parties, a whole variety of
different demand sources. So what are we going to
do that, with respect to these third
party ad networks? So that’s a feature that
we’re calling Live CPM. It’s pretty cool, if you
think about it, right? We know before serving
the ad, at least what we think each of
these ad networks is going to return
in terms of value. We don’t know for
sure whether or not they’re going to
actually have an ad, but we know the
upper bound, roughly, of what the value from each
ad network is going to be. Yet what we know with a
lot more precision, what we know with 100% accuracy, is
what Google’s demand sources can fill this impression with,
and what the value of that will be. So the Google demand
actually floats through the lines of third
party ad networks here. And it gets plugged in at
exactly the right place. So if your top third
party ad network is going to monetize better
than that Google demand source, fine. We’ll go and we’ll request
the ad from the top ad network and we’ll show that one. If that ad network had no
ad, and the Google Live CPM was the second one
in line, then we’ll go and we’ll bring
that piece of Google demand in to fill
that impression. Again, it’s a really
fundamental change. It enables optimization. It enables maximizing revenue,
without you guys sitting there, calling up your friends,
OK, what are you getting from ad network A? Oh shit, I was getting this. What’s their fill rate? OK, what’s the probability? OK, I’m going to
put him here, him. Just let us figure
this out for you. We’re completely transparent. You’ll see the data
that we’re doing. We’re not trying to play
any games behind the scenes. But we’re just trying to take
away one more piece of pain. And keep in mind, that
this Live CPM really enables us to squeeze the
maximum value out of the system by looking at the exact value
that Google’s demand can offer any impression, any
user that you have. It’s pretty cool work. In fact, we’ve had this in beta
now with a number of our game developers, our app
developers, and some have seen as much as a
200% lift in revenue. Now you’re not necessarily going
to get that across the board, but I can guarantee you today,
that you’re leaving money on the table, that our new ad
network optimization features will help you bring off and
reinvest into the great games that you’re building. So the last thing that I
want to announce today. It is a crazy
world that you guys are helping create, and
innovate, and constantly move forward. The trends are changing
at enormous speeds. And it’s hard for
all of us to keep up. So at Google we’ve
worked incredibly hard to deliver what we’re
calling the App Developer Business Kit. And this works for
app developers, but also for game developers. We’re talking
through the trends. A lot of what Bob was
up here talking about, ahead of Russ and I,
are going to be in here. So trends, information
for you to use, for you to share with
your marketing teams, for you to share
with your executives. As well as tips
and tricks for how to think about
building, not only truly engaging and
compelling experiences, but the kit goes into a
lot more detail explaining what we’ve glossed over
at high levels here, so you know how to squeeze every
last dollar out of your app. So that you can be fully
maximizing the revenue that you’re getting, but
also keeping your users engaged, keeping them coming
back time and time again. So that you can build not
just a successful single game, but you can build an entire
empire, an entire enterprise of games moving forward. We’re really excited
about this, take a look. It’s live right now
on Again, just to repeat, because
I know you guys have lunch, and I know you’ve been
in here all morning. First and foremost,
we are giving you tools to fundamentally
unlock insights and understand the users that
you have in your games today. And that is driven
by Google Analytics, and Google Analytics
fully integrated into our AdMob
publisher platform. Second, we’re
going to enable you to grow this great
in-app purchase revenue that many of you
are already capitalizing on, to leverage the
segmentation and the user understanding tools
from Google Analytics, and bring that in
proper, so that you can do the right things for the
right users at the right time. And last, we’re helping
you maximize your revenue across both of these segments
of users, but also across Google demand sources, and
third party ad networks, to the fullest possible
at this point in time. Thank you guys so much, we’re
really excited about this. We’ll be hanging
around in the back if you guys have questions. With that, really appreciate it. [APPLAUSE]



Please enter your comment!
Please enter your name here