About Andrew Lilien
Chances are you’re familiar with Fortnite, but unless you’re a gamer or live with one, you may have never heard of Turtle Beach. As an entrepreneur, the story of Turtle Beach, which we branded as a headphone company in 2005 fascinates me. It’s a tale about iterative adapting and continuous improvement that lets us success.
Andrew Lillian, the vice president of marketing at Turtle Beach, who I am fortunate to call a good friend is here with us today to share the inspiring story. Welcome, Andrew.
Andrew Lillian: Welcome. Thank you for having me. Glad to spend some time with you today.
Sherri Langburt : Thank you. I understand congratulations are in order.
Turtle Beach hit a record breaking milestone this year, making it the global leader in gaming headsets.
Tell us a little bit more about this achievement and what it’s meant to you personally.
Andrew Lillian: 2018 was our best year of all time. Turtle Beach did over $300 million in global sales, which was fantastic. We’ve actually been the leader in gaming audio now for seven consecutive years, which has been fantastic. We [00:01:00] have had over 45% market share for seven consecutive years, which is an incredible milestone. Certainly last year it blew all records out of proportion.
The gaming industry was up about 70%. We were up 85%. There were a lot of companies in the industry that benefited in riding the Fortnite wave. I think our team was just really well prepared to take advantage of the opportunity. It was really rewarding because we’ve been putting the right strategies in place for the last few years and quite honestly the video game industry has had a couple of choppy years, last few years.
There was some stale games in the market, lack of consumer growth. A lot of the games were very first person shooter oriented. Fortnite is a little bit of the opposite. Fortnite brought a whole new genre to the market in battle royale. With that created a lot more mainstream appeal.
Andrew Lillian: You took an industry that was largely a little bit of a niche industry and made it a lot more mainstream. For me personally, I thought it was great. A lot of people said last year was lucky. We were in the right place at the right time.
I look at it where opportunity and preparation really meet up together. We were fully prepared to take advantage of this opportunity last year. All the strategies and the hard work we’ve been putting in for two or three years, really paid off last year.
Sherri Langburt : That’s really impressive.
Let’s talk about what was some of the preparation and strategies that propelled you into this number one spot?
Andrew Lillian: Sure. [00:02:30] A few years ago a lot of the video game industry was … You could do nothing in the whole year and then in the fourth quarter you could spend a bunch of money, you could advertise. That’s particularly when new game releases came out, the big franchises like Call of Duty or Battlefield or Halo. That’s when they all hit the market. That was what our headsets were known for.
In the last couple of years we’ve made a drastic shift in our marketing strategy to leaning on a lot more influencers to drive our brand and drive our message and using paid [00:03:00] media much more in the conversion tactic.
We spent the last couple of years identifying small up and coming influencers that if you fast forward two or three years later to today, some of you guys are now household names and leaders in their space. We’ve been working with them since their very beginning. That’s really paid off for us.
Sherri Langburt : That’s always good to hear from my end. Forgive me for snooping, but I’m obsessed with people’s inboxes. I’m just curious.
How many emails does someone at your level get a day? How do you sort through all the clutter versus the opportunities?
Andrew Lillian: On average I’d say probably get about 150 emails a day that I know about. In other words, what I see in my inbox, there’s probably another 200 or so that are roaming around in my spam folder. It’s tough. It’s tough to really get through the clutter.
Most of the emails I get are probably from new digital vendors. Everybody trying to sell you on higher conversions on your website, better SEO, [00:04:00] better affiliate programs. Most of those I’ll either forward to our digital team or quite honestly I’ll delete because we’re probably already working with the right vendors or the services.
Andrew Lillian: There’s also the lengthy list of new business opportunities. In store merchandise companies, POP companies, packaging, printers, graphics agencies. Those I only tend to read if there’s a definitive need.
If I get something from a potential influencer or potential leader or celebrity, what have you, I may read a little more carefully just to keep up on current trends and where our industry is headed in terms of marketing strategies.
Have you ever responded to a cold pitch by an influencer?
Andrew Lillian: I have, more just to get some more information on who they are. It’s rare that I’ll respond to an influencer if it’s just that person reaching out to me directly. Most of the folks today are pretty savvy and they have some sort of representation.
Obviously the bigger folks have full fledge agents, everybody from CAA to Roc Nation to big time agencies. It depends. If I’m looking for a specific need, a low level musical artist or a low level athlete or something like that, that I’m trying to keep my eye on, it may pop in my head.
If I’m looking for someone in a specific region and someone reaches out to me with a specific regional needs … It’s a bit rare only because of the amount of emails they get per day. Then knowing obviously what our budgets are and what our strategies are we can only do so much in any given year.
Sherri Langburt : No, totally makes sense. I guess I’m curious … You brought up all the different companies that write you, but from our perspective I’ve seen influencer marketing … While it’s come a long way, it’s really still divided territory between PR agencies, ad agencies, networks.
How does Influencer Marketing get handled at Turtle Beach? Is it internal? Is it different people responsible for different things?
Andrew Lillian: That’s a great question. If you backtrack about three years ago, we were relying on our media agencies. I think agencies started seeing the need to diversify and bring other programs to clients. Some of our agencies were bringing us programs where you could sign up with a bunch of influencers, 50 influencers, 100 influencers for a Q4 campaign.
They wear your products on the stream. They talk to your products. We felt that it would be really unsuccessful because the second year contract ended with them, they were wearing a competitor’s headset or they just weren’t authentic to your brand.
We took all that in house about two years ago and hired a whole internal partnerships team. We 100% handle that all internally. We feel that’s our secret sauce.
Andrew Lillian: We find that influencers respond a lot better to us if you’re speaking to somebody from Turtle Beach, if they’re catering to their needs. We’ve heard from a lot of influences that are on our team that they left previous competitors because they’re just one in a stable of many and they didn’t get a personal attention that they deserve.
Part of the large part of influencer is obviously monitoring what they say and having closer access to them allows you to control some of the messaging a little better. It’s one step away from speaking to a person directly versus going to an agency and having it watered down.
Again, authenticity is the absolute key. Consumers can see right through that. If you have someone talking about your brand or pushing your brand that’s not completely invested in it, you’re going to lose.
Andrew Lillian: The influencers we tend to work with are all gamers first and foremost. If you’re not a gamer, you’re just a musician or an athlete and you just want to wear our stuff, we’re not interested in working with you. If you’re a gamer and you’re a gamer at heart …
There’s different levels of gamers. You can stream on your own. We work with a couple NBA players who are hardcore streamers, have their own podcasts, go to various gaming tournaments, play in Fortnite programs. That’s a different level of extreme.
Those are great, but we also work with gamers that might bring a PS4 with them on the road during NBA road trips and just game in their room at night. Those are authentic gamers as well. We’ve had a lot of success working with them as well.
Do you remember your first influencer campaign and what did that look like?
Andrew Lillian: Yeah, I do. It’s funny. When we first got into this, we signed an organization called Optic Gaming. Optic Gaming was one of the largest gaming organizations in the world about four or five years ago, primarily in the Call of Duty space. Not only were they a professional e-sports team, but they had a whole network of influencers that had crazy amounts of followers on social.
We’re talking about seven figure plus followers on Twitter. We were launching a brand brand new e-sports headset, a professional gaming headset. It had everything from memory foam ear cushions. It’s a microphone technology, super human hearing, all the bells and whistles. Going into this early on you wanted your influencers to basically read an ad for you.
You wanted your influencers to basically read off a script and you want to be able to control the messages and messaging, you learn very early on that you can’t do that.
Andrew Lillian: You can’t force an influencer into an advertisement in the way that you run traditional paid media. They can’t sit there and read off of the script and go feature by feature. It’s not authentic to them. It’s not organic to their personality. We were really nervous. We had this brand new headset and we wanted to make sure …
They have to talk about the memory foam ear cushions. They have to talk about if you wear eyeglasses, you can tuck them under the ear cuffs and it doesn’t pull down on your ear lobes. They have to talk about the microphone technology. You’re giving an influencer run of the campaign and they’re like, “We’re not going to do that. We’re going to make our own piece of content. We’re going to talk about it in our personality.” It turned out great.
Andrew Lillian: It was a spot that got I think 2 million views between Twitter and YouTube. It was a little bit of a comedic take on a headset. It brought a little bit of personality to it. It really played off the personality of one of the members of the Optic Gaming content team and it worked out great.
I remember we were just so nervous because we were like, “They got to say this. They got to say that.” That’s the thing I think we learned early on with influencers. You can’t 100% control the narrative. You have to let them breathe. You have to let them adjust their own personality and that’s what their audience wants to see anyway.
Sherri Langburt : No, it’s great that you recognize that. We have a lot of brands. Unfortunately some industries are regulated so they have to have control over what the influencers do. It certainly is about their creativity and their voice and their stories. Very insightful.
I guess I’m thinking a little bit about Twitch cause you keep talking about Twitch. I know Twitch. We’ve done campaigns in Twitch at Babel Box, but we’re starting to see an increase in requests from brands. Brands that you would never think of. Food brands trying to tap into Twitch as a promotional channel. I don’t think our listeners know much about Twitch.
Could you explain a little bit more about Twitch, how it works and why this channel has been so effective for Turtle Beach?
Andrew Lillian: Sure. To take a step back, Twitch I think was started maybe 10 years ago or so as a small company called Justin TV. It was a small way to have low level broadcasts or broadcast their game play on the Internet. Fast forward to 2014 Amazon bought Twitch for $970 million. It’s a real deal.
Twitch is so big right now that you could watch the Thursday night NFL game package on Twitch last season and this season. Every Thursday [00:11:30] night, whatever NFL game is being broadcasted on Fox or the NFL network, you can get a Twitch and watch it live.
Basically it’s a live streaming service in the video game industry where anybody can go on for free. If you’re going on for free, you’re going to be served up various advertisements during people’s stream.
Andrew Lillian: There’s also a subscription model where you pay $5 a month for basically ad free content. The ad-free content is a more successful model. I think for Twitch. You look at advertisers and brands that want to get into Twitch, it’s not through traditional 30-second spots.
We’ve done some of that in the past and gotten a really poor result. The way that you’re really successful with Twitch is tying into talent that is on Twitch and integrating your brand or your product within their broadcast. Over time their listeners, the subscribers.
That’s how you penetrate. Right now I think there’s, I don’t know, something like two and a half million monthly subscribers, maybe even more.
Andrew Lillian: The numbers are massive and after a stream is concluded on Twitch … A streamer goes on there for two hours or three hours. More than likely that content then goes over to YouTube. If you’re integrated into that broadcast and you’re integrating into that presentation, not only is your brand and products being promoted and used in many cases on Twitch, but now you’re getting a secondary audience that’s watching on YouTube after the fact …
Obviously if something happens that’s funny or comedic or controversial and it goes viral, now you’re getting the additional added value of after the streaming is done, it’s being shared on social. A lot of the content starts on Twitch and then morphs on other channels. In the video game industry it is an enormously popular and successful tool for the way gamers go get their content.
When my son sees these videos on YouTube, they’re probably coming from twitch?
Andrew Lillian: Yeah, absolutely. They probably either started with Twitch or they started on Mixer. That’s Microsoft’s form. There’s a really popular influencer named Ninja right now. He’s probably the most popular Fortnite player in the world. He actually just switched from Twitch, the Mixer in a really controversial deal.
Sherri Langburt: I saw that.
Andrew Lillian: You can see as content on YouTube after the fact though. There’s a great chance … My son watches a lot of his YouTube videos as well. They’re all recordings. They’re not live, but more than likely they were live at some point. Sometimes they’re go live on YouTube as well. YouTube ends up being that end destination for a lot of his content.
Sherri Langburt : So fascinating. I know with our community of influencers, a large majority of them are female and it brings up the question that … In doing some of the research that we’ve been doing, we see that millennial female gamers are on the rise.
Are you focusing your efforts exclusively on Twitch to hit this demographic or are you hitting them at all?
Andrew Lillian: It’s an extremely important demographic. Our research has told us that one in three gamers are female, about 33% of gamers are female. Another important sex fact that we saw is that it was one in three gamers that were female. Most of them actually share headsets with each other, so it’s absolutely an opportunity for us to market new headsets.
We actually just released a new product about a month ago called the Recon Spark. It’s a female oriented product. It’s got lavender color waves. It’s more than just the color spin. It’s just more of a personality driven headset. Very often, usually female audience …
Your first reaction may be, “Let’s make a pink product and sell it.” Obviously it doesn’t work that way. We’ve done a lot of research into what female gamers want, from color pattern, from technology in their headset.
Andrew Lillian: It’s a big focus for us and how are we reaching them? We are reaching them on Twitch, we are reaching them on YouTube, but we actually just partnered with a female oriented gamer festival on the west coast called Supergirl last month, which was a gaming and music festival for three days that was primarily female focused.
If you look at our influencer roster, I’d say we have about 10 female influencers right now. A very important growing community for us.
Andrew Lillian: Once a year we show up to the GameStop managers show. What it is is GameStop flies in all 5,000 managers from every game stock in United States. You have a 20 minute session with about 200 of them. You do that for about 20 times over two days and you talk to them about your messaging and your products.
Every year there’s more and more women that are involved. I would say about a third of the managers of all GameStop stores in United States are female. We recognize it. It’s an extremely important demographic. At the end of the day, a gamer is a gamer. It doesn’t matter if you’re male, female or what ethnicity you are. A gamer is a gamer and that’s the way to market to gamers.
Sherri Langburt : So fascinating. I’m all for the pink category. If you’ve developed those, I’ll buy a pair. I’m going to ask you this, name an influencer in any vertical that you love to love and hate to admit you follow.
Andrew Lillian: It’s an interesting question. I don’t think my wife knows this, but Alyssa Milano. Alyssa Milano is somebody that … I won’t use the word obsessed. I don’t want to come off as creepy, but I’ve just been a fan of hers for 30 years. Besides her success in acting, she’s actually an avid sports fan. She’s a huge baseball fan.
She’s come out with a line of clothing that’s female oriented for sports. She’s a little bit of an activist on social, talks a little bit about [00:17:00] political activities. She’s just a fascinating person to follow. She probably has two or three million followers on Twitter. Posts quite often. I’ve just been drawn to her.
I think she’s a really popular celebrity that’s been around for a long, long time. Some people remember her way back from Who’s the Boss. Some people remember her from … I don’t remember the name of it. The witch show that she was on for many years. Just someone I’ve been … For whatever reason, fascinated with for 30 years.
Sherri Langburt : That’s very interesting. I didn’t know all that about her, but I’m going to look it up after we get off the call. Very interesting.
Then another curiosity is if you were an influencer, what would your handle be?
Andrew Lillian: I think I would go with either A-Train or A-Money. If it was A-Money , it would be A and the dollar sign. It won’t be a [inaudible 00:17:54] spelled out. Most influencers today have weird characters or emojis in their name. It’d be one of those. Like I said, if it was A-Money, it’d be A dollar sign. I’d probably have to think of some good hook after that, but probably something like that.
Sherri Langburt : I like them. I like it. What’s next for Turtle Beach? Obviously we’re heading into, believe it or not, this busy season for you.
What’s next on the horizon?
Andrew Lillian: We’ve been primarily a console gaming company for the last seven, eight years or so. When I say console, Xbox and PlayStation, we’ve dabbled a little bit in PC. We just acquired a really successful German based PC company called ROCCAT.
They primarily produce keyboards and mice. They also do headsets but their focus has been on keyboards and mice. PC gaming is a really growing segment. It was up 80% last year. The US is probably primarily console focused, but there are certain countries in Europe and certainly in Asia that are very PC dominated.
With PC gaming, you need keyboards, you need a headset and you need a mouse versus a console. You just need a headset. Really [00:19:00] a big push in the PC gaming integrating our purchase of ROCCAT , taking advantage of the fact that now we can offer customers more than just the headsets. For customers as a PC gamer, we can sell you a headset, a keyboard, a mouse, a mouse pad, the whole suite of products together.
Are they going to be rebranded as Turtle Beach or it’s going to be under ROCCAT ?
Andrew Lillian: It’s a great question. It’s a question I’m actually asked every single day. Personally I’ve gone back and forth on [inaudible 00:19:30] [00:19:30] on both sides of the fence. We’re actually in the middle of a brand study right now. We’ve hired third party agency who is doing a deep dive using consumer research key internal stakeholder interviews.
They’re actually set sometime later next month to present their final findings to us. I suspect at some point later this year we’ll have a clear direction. Then at some point in 2020 consumers will be able to see that brand direction. There are a lot of positives for keeping both brands.
We’ve seen a lot of mergers and acquisitions keep both brands. On the flip side we’ve also seen a lot of mergers and acquisitions phase out the smaller brand and keep the larger brand. We’re in the process of doing that right now.
Sherri Langburt : It sounds like a lot of work, but very exciting. Best of luck with that and just want to thank you for taking the time to be on Beyond the Boxx today and for all your insightful help here.
Andrew Lillian: I appreciate it. Yeah, this was great. I love talking about our industry and talking about our products. It’s an exciting time. Once you go back to school and you’re turning the corner to the last four months of the year, it gets really exciting.
That’s where traditionally the big games still come out and that’s really when gamers get excited. The big new hero franchises. Really starting in August with the sports franchises. All the hockey, the basketball, the soccer franchises usually typically release in August.
Then it’s a string of all the popular games from Call of Duty to Battlefield to Halo to any [00:21:00] of the popular titles in any given year. It’s always an exciting time of year.
Sherri Langburt : Yeah, it definitely is. I might have to come to you for a private tutorial on all this soon. Thanks again. I really appreciate it. I will be on the lookout for more from you.
Andrew Lillian: Awesome. Thank you very much. I really enjoyed spending time with you.
Sherri Langburt : Thanks. Have a great day.
Andrew Lillian: You too. Bye.
Sherri Langburt : Bye.