Supersonic sees big growth for ‘rewarded video ads’ in mobile games (interview)

GamesBeat: It’s interesting how, on analytics at least, everything has moved more and more into real time. Do you feel like you’re moving in that direction, throwing more computing resources at the problem to be closer to real time?

Shoham: I think it has to be like that. We had a discussion before about brands and why brands are still behind on mobile. They’re not investing enough. Or if you look at the consumption of mobile, ad dollars invested in mobile versus TV for instance, it doesn’t make sense. TV is so much bigger. Mobile has a lot of room to grow.

The ability to track data in real time and understand what format and what channel in mobile works for you — brands that are mobile first, they’re better at tracking and having integrated analytic platforms like Mixpanel and others, to decide if each user is the right user. Based on that, the advertiser can tell if an advertising form or channel makes sense or not.

The guys that are mobile first, they get it. A lot of brands are not doing it. It’s absolutely critical. If you look at native mobile advertising, there are lots of forums — reward-based advertising, video, interstitials, banners. Our approach is that the advertisers need to test everything, but they can only do that if they have the ability to track in real time, shut down things that don’t work, and invest more in others that do. You have to do that.

GamesBeat: Are you surprised by every game that comes along and skyrockets to the top of the charts? Trivia Crack is the latest to come out of nowhere. Why is a trivia game on top? My kids are fanatically playing it now. It seems like they want to learn something again.

Shoham: It’s amazing how users, mainly youngsters, adapt so quickly. They’ll shift from one game to another, even if the game mechanics are the same. Maybe the music is a bit different, whatever the reason is, but there’s no loyalty at all. They shift immediately.

GamesBeat: What else do you notice about games that are trending or catching on, the kind that you would bet on in the future?

Shoham: I’d look more at companies. What’s the process that brings these game developers to launch a game and test it? Good examples are Machine Zone, King, and EA as well. They have a lot of studios and a process of creating a lot of games. They A/B test them very quickly; is this working or is this not working? Smaller developers are more of a hit-driven business. They get lucky building one game, and it turns into a huge hit, which is impossible to forecast.

The bigger developers have this machine, which is more of a business intelligence machine as opposed to something creative, an art. That gives them a bigger advantage.

GamesBeat: What did you think about some of these companies that went for Super Bowl ads?

Shoham: I’m proud to see it happening. There were three ads, right? It’s a good investment. These guys are buying everywhere — buying on Facebook all the time, all the channels — so they have to do more.

Above: The Supersonic logo.

Image Credit: Supersonic

GamesBeat: They’re trying to reach every user on the planet.

Shoham: What’s next, right? The Super Bowl must be the next thing.

GamesBeat: It seemed so ephemeral, though. I wonder if it was still a good use of that money. I guess if you’re that big, you can try out something like that.

Shoham: From a user acquisition perspective, what does it cost to draw a user? The Super Bowl is, what, [$2 million to $3 million] for 15 seconds, with a viewership of 200 million or thereabouts? If you make that calculation, it’s probably significantly cheaper than paid user acquisition. With these guys, the majority of the users out there are their clients already. It’s not only new user acquisition but also brand awareness, or a form of re-engagement for existing clients.

GamesBeat: It’s still a very mysterious business as far as what’s taking off and what’s not.

Shoham: Well, so is the music business. It’s very hard to forecast. That’s why I look more at the production houses and studios. What studios have the process to very analytically create something that can engage with users? As opposed to just having an idea? That’s not enough to create a good game. An idea is not enough.

GamesBeat: Do you know enough to bet on any one particular company?

Shoham: I’d keep betting on EA. If you look at their stock in the last few months, it went up significantly, and for good reason.

GamesBeat: Supersonic is really just providing the ammunition for this war, right?

Shoham: We’re basically an enabler. We’re helping publishers find users and generate revenue from non-paying users, which is critical to managing their business. The VC funding will stop at some point. Or it won’t stop, but I don’t think 2014 is going to continue as far as the amount of money these guys are raising. These businesses have to become businesses. They need to be able to monetize and be profitable — not just in paying users, but on average. That includes non-paying users as well. That’s our job.

GamesBeat: It does seem like we have a very good group of winning companies right now. Not enough of them are in the U.S. In a healthy way, it’s spread throughout the world. It’s not just Japan, Europe, and the U.S., like it is for consoles. Successful game companies are rising all over the place. But it seems like the U.S. companies have to get up and do something about that. Helsinki is outdoing the entire United States right now.

Shoham: One reason is that these guys in Europe, from day one they think about other markets. They’re not just thinking about their own. That’s also happening in Israel, where our company is originally from. We started from day one thinking about other markets, experimenting in multiple markets from the beginning. U.S. companies probably focus mainly on the U.S. in the beginning, which is much more competitive. You get lucky, or you have more data and find more opportunities if you think of a few more markets, the global market. The same thing is also true in Asia. The Korean developers, from day one, think about non-Korean users. It’s an advantage. And it’s easier for them to scale globally afterward, because they have that practice.