“The casino industry doesn’t have the depth of knowledge on who their future consumer is.” Those were the words spoken by Rahul Sood of Unikrn during GiGse 2017 in San Diego last month. Indeed, a major focus of the three-day casino gaming industry event surrounded video gamers instead of traditional slots and table-game players – showing that the door is open to a new and lucrative market for non-casino game developers.
In one panel, experts from UNLV’s Center for Gaming Innovation, GameCo, Rover Strategic Advisors, Zeal Networks, and Guru Games, barely touched on traditional casino fare and focused entirely on how to merge skill-based games with gambling.
GameCo’s Blaine Graboyes noted that the average gamer is 35 years old and is looking for VIP experiences that the casino industry is adept at – but with a video gaming slant. “I’ve been producing games for over 20 years and there’s just a level of interactivity and engagement that isn’t available in slot games.”
Surprisingly, many developers invest enormous amounts of time, effort and resources in developing games or apps that are built on very shallow foundations. It’s great to have a strong product vision, but without understanding the market situation, competition, target group, acquisition costs and performance benchmarks, you are navigating blindly. As a result, it’s highly likely that you will run into trouble – wasting your time and your money in the process.
The cost of producing a mobile game has increased dramatically, and so have the marketing costs associated with getting your game noticed. Big publishers like Kabam work with strong IPs – Marvel in this case – and budgets of around $14M per game. They also have a large user base waiting for new titles. If you’re looking to compete with these industry giants, it’s vital to start the journey by heading in the right direction.
Here are five tips on how to research the market and evaluate the viability of your business prior to commencing development.
Step 1: Check the Business Potential
About a year ago AppAgent worked on the marketing of the game code-named Gods&Guilds. It’s a building strategy game similar to Clash of Clans, but based on Norse mythology.
The first thing to do if you have an idea for a new game is to check Google Trends to understand how similar games are performing. Are they fading in search popularity or still going strong? Rankings in AppAnnie can provide similar insights.
The trend will help you understand whether your new game will be timely or late to the market. Over time, players’ tastes evolve, and with product development taking between 1 to 2 years you don’t want to waste your time developing for an audience that is shrinking. In this case, the popularity of CoC has declined as Clash Royale has grown, demonstrating a shift to more casual and fresh format addressing a larger audience. Of course, it’s entirely up to you if you prefer a more niché, or ‘hard-core’ game genre than a mass-market casual approach, but by studying the trends at least you will know.
Next you should estimate the business potential of each platform. Priori Data or other market intelligence tools provide comparison of downloads and revenues per platform. For Gods&Guilds we identified that, while iOS accounts for 36% of downloads and nearly half of the revenue in strategy games category, Android generates large enough revenues for it to be used as the first platform, enabling us to scale faster and at a lower Cost Per Install, which is an important factor for a multiplayer game.
Also, it’s interesting to analyse the average revenue of games at the 10th rank, 50th rank and 100th rank in the top grossing charts. This helps you to understand the monetary chart curve and see if you can earn enough money, even if you aren’t able to reach the popularity of a game like Clash of Clans.
Newzoo provides great – and totally free – market reports and several paid analysis focusing at specific verticals, regions or aspects such as engagement metrics, monetization metrics, trends or consumer insights.
Once you feel that the selected genre has potential, it’s time to look at the competition.
You should check:
Stats: rating, downloads and revenue estimate (Priori Data, AppAnnie)
Proposition: what’s the unique selling proposition of your product (App Store/Play Store, ideally using AppAnnie)
Key features: what are the main product benefits
Reviews: pros and cons, the trend of the rating in time (AppAnnie)
Visual style: how the app is presented in the store
For a better understanding of Gods&Guilds we compiled key metrics in a simple table and then visualised main characteristics of the game’s competitors on a matrix chart. Here we can see that Clash of Clans operates in a completely different league. Even other big games have much smaller download velocity and an average ARPU of around $3.50. In terms of visuals and concept there’s a big space for an isolated game play with realistic visuals.
The result of this step is to help you find a unique position and to bring something new to the market. In Gods&Guilds the approach was to build an army of heroes from Norse mythology and focus at multiple game modes, yet the existing stylized visuals conflicted with many other games on the market.
Step 3 – Find Key Audience Insights
Personally, my favorite part is the analysis of the audience because it helps to form a clear player profile. It’s the foundation for the product but also informs the design, the store listing, creating targeted paid ads and creating a compelling advertising message.
The best starting point is Facebook Audience Insights where you can select top games or apps in your segment and analyse audience by gender, age, status and even affinity to other fan pages. Facebook also conducted a segmentation of gamers which can serve as an inspiration how to think about user personas. It’s a little outdated, but it’s still useful: https://insights.fb.com/2014/12/18/the-many-lives-of-gamers/
You should ‘dive deep’ into the details to understand what users like about specific games or apps, if they are social or competitive and if they have a disposable income. The last question can be partly answered using a market intelligence tool where you can divide the revenue by downloads per country/platform/category and get a “Purchase Index”. This value, combined with an estimated CPI and difficulty to reach top charts, helps you to pick markets which you can focus on after the global launch.
critical part of target group research is an estimation of the market size. The trick is in using Facebook Ads Manager to play with overlaps of different groups and understand the audience size and profile, even on a country level. Even if you will use other ad networks such as Adwords or video networks, it’s a good starting point providing a relative comparisons of market sizes. Just be aware of specific countries where Facebook competes with local giants such as VKontakte in Russia.
Step 4 – Count the Profitability
In the freemium world, the business stands or falls on the equation of Cost Per Install and Lifetime Value. If the LTV exceeds acquisition costs, you’re able to scale the user base and grow revenues.
The LTV calculation is a topic for a separate article which will follow in a near future as there are different approaches, methodologies and other elements of the model. To begin with you should start by calculating lifetime from expected retention benchmarks and multiply the value by desired Average Revenue Per Daily Active user. This doesn’t include any virality or organic uplift which differs by game genre, platform and country, but at least it gives you a basic understanding of the LTV component. For more about LTV, read Yaniv’s post where there are different calculators.
The part of acquisition costs is easier to estimate. We at AppAgent use two free data sources:
1) Chartboost CPI Index: this index is applicable for games only. With a CPI of $3.48 in the US and Gods&Guilds multiplayer modes requiring a critical mass of active players it’s clear, we will need a big budget for paid acquisition. The solution could be a focus at specific time zones to improve a “local” matchmaking in the game.
2) FB Ads Manager: to start the CPI estimation, select a list of your competitors using Interest targeting, pick a country and platform and check the suggested Cost-Per-Click. If you divide the suggested price by an estimated conversion rate in the store (for paid traffic this could be in average about 45% for iOS and 40% for Android if you don’t have your own historic data) you get a quite good Cost-Per-Install estimate. If some of your fellow devs have a game within your category, ask for Conversion Ratio Benchmarks in the Google Play Consoles under the Acquisition Reports tab. For Gods&Guilds the current estimate for the US male audience using Wi-Fi connection is $3.65 which creates high demand on the user lifetime value to operate profitable campaigns. Yet great mobile acquisition managers can drive the price lower, leveraging new formats, original creatives and smart approach to targeting. Also, big IPs significantly increase the conversion rate and drive the CPI much lower, a situation confirmed by Will Newell, former UA manager at Space Ape Games on Transformers: Earth Wars.
From this point on you can move forward and build your own growth model where you include paid and organic traffic (cross-promotion, word-of-mouth, even featuring if you’re confident to secure it). Once you add retention numbers and ARPDAU values you will get a possible financial outcome. A basic definition of a mobile growth model is described by William Gill at the Mobile Growth Stack web.
Step 5: Test the Most Appealing Theme
Not many developers are aware of testing creative aspects of the game. Will Newell revealed at the AppAgent Academy that at Space Ape Games have tested the name tagline of the Transformers game using Facebook Ads with CPM bidding. With three fan pages the test used the same creatives but different product taglines. The winning name is well known today: Transformers: Earth Wars.
At Geewa, we recently proposed over 100 names for a new game. The final shortlist of four went to the Facebook test, where the main KPI was the Click Through Rate of a mobile ad showing the brand name as an artwork. My favorite Smashing Four reached a CTR of 2.6% where others reached between 1.1% to 1.6%.
Pixel Federation went even further and tested the visual theme of an upcoming match 3 game. “We’ve used FB ads and Splitmetrics to measure both the ads CTR and the store conversion. The winning concept called Button Blast reached 1% better CTR. In terms of conversion rate it won with 25% by far ahead of the second concept Music Match with 17.5% and Yummi Blocks with remaining two below 12%,” said Matej Lancaric, mobile marketing manager.
With high development costs, brutal acquisition prices and fierce competition, it’s necessary to lower the risk of failure and be smart about your business decisions. With the free data and tools available you can find a much more direct route to success.
These are just some of the things that you can do, and it’s likely that there are several other techniques out there that can help you to analyse the market and verify ideas. As a growth fanatic I would love to hear them. Don’t hesitate to reach me via Twitter or by email: firstname.lastname@example.org.
Peter Fodor is the founder of AppAgent, a mobile marketing team jam-packed with experts available for hire. Since 2011, Peter has worked on the launch of nearly 30 apps for all mobile platforms. Today, AppAgent focuses on mobile strategy, data analytics, mobile creative services and user acquisition. Peter and his “agents” serve US based Malwarebytes, Polish based AAA gaming studio CI Games and one of the fastest growing startups in Europe, Kiwi.com.
I honestly can't remember the last time where I didn't learn something new at work.. - Peter RobinsonClick To Tweet
Entertainment for kids is a rich and complex market. At Casual Connect Europe, a session titled Anticipating 2017 Trends…and What to Do About Them, Dubit Global Head of Research Peter Robinson illustrated the when, where and why of entertainment for kids. During this session, Peter described how to turn forecasts into strategy in development and marketing for modern day kids.
Analysts try to predict where technology, platforms and content are likely to go in the coming year. With new findings from Dubit Trends’ international survey of 2 to 15-year-olds, learn how you too can take advantage of the fact that “Gaming is a main thing kids use the tablets for” and “1/4 of kids media time is on games.” To learn more about kids entertainment consumption and how to understand what is coming next, be sure to watch the video of Peter’s session from Casual Connect Europe.
Casual Games Association has announced the winners of the 18th Indie Prize awards. The honorees were revealed during an awards ceremony at Casual Connect Asia in Singapore.
Stifled, a mic-enabled sound-based stealth thriller by Singapore developer Gattai Games, won Best Game Design and Most Innovative Game. In Stifled, players use echolocation with both sounds made in the game universe and by the players themselves using a microphone, to find there way around the world, but they must be careful not to attract attention to creatures in the darkness. The game came be experienced at Steam.
No matter how big or small your studio is, one fact remains true: paying for users is expensive. Paying for good users is even more expensive. And being able to retain them is the philosopher’s stone that every publisher desires in order to succeed in the mobile ecosystem.
This article is not a diatribe against companies offering user acquisition services or against publishers who decide to use a paid strategy to increase their user base. With good performance and proper management of costs and life cycle, paid acquisition can be very beneficial and a great way to accelerate traction for your games.
This article aims to show there’s life beyond paid advertising. We are going to demonstrate how we succeed in increasing our user base by using alternative strategies and tactics that required no investment.
“Each time I’ve experienced an amazing game, film or TV show, I felt a desire to illustrate it with my music and therefore be a part of it,” said Mikolai. “However, in case of The Witcher it was more than that. When I read the Sapkowski’s books in the mid ‘90s I loved them, but was aware that one needed to know Polish language to appreciate it and therefore felt bad about those who didn’t. Now not only am I able to share the world of Geralt but also my music attached to it. What a joy!!!”
Poland has itself grown into a hub for gamedev in Europe over the past decade. He’s also at the forefront of a growing Polish game music composer scene, including Kamil Orman-Janowski and Arkadiusz Reikowski. Mikolai attributes this rise to the use of personal computers from Spectrum, Atari and Commodore in Polish apartments in the ’80s.
Matthieu Burleraux is the Business Development Director at Pocket PlayLab. The company is helping to provide mentorship on different matters to developer Cupcake, which the company invested $1 million into.
“We are helping them understand how to work around game KPIs, including in user acquisition, using these KPIs to optimize the game as well as their marketing campaign,” said Matthieu. “For example, we are focusing a lot on the daily cohorts, the LTV45 associated to them, the CPI, retention numbers, etc. We are also starting to help them on producing visual assets for UA and provide mentorship regarding developing the game on new platforms.”
“Before making the decision to work with Cupcake, we looked at the basic KPIs (ARPU, ARPPU, retention, virality, DAU, etc.) and their evolution over time, but we also looking into UA KPIs such as the CPI they had, ROI on UA, etc.” Matthieu continued. “The goal was for you to see if the game was sustainable and if we could grow it.”
By devtodev analysts, Vera Karpova and Vasiliy Sabirov
Currently, product analytics reached a sufficiently high level of development. Many analytical systems are equipped with a variety of tools that will tell in detail how users behave in the application: when they buy, where they live, how much they cost for the company and how they leave.
These tools have become a part of daily life, regular monitoring; assistants in the decision-making process – now it is a must-have for any project.
Funnels and segments don’t surprise anybody anymore, and as in any other business, having reached the top of one reveals a will to go further and improve.
In this regard, the sphere of analytics is no exception, and in the past few years a new kind of data analysis – predictive analytics – began to develop.
You’ll also have an idea of predictive analytics, if you monitor the metrics on a daily or even hourly basis.
For example, you know that usually at 12 a.m. there are about 20,000 users in your game, and today this indicator is much lower. It equals 15,000 users. You understand that there is a trend for decline, which means that it is necessary to find the cause as soon as possible and improve the situation before the indicator falls even more.
Are you interested in the social casino space in the game industry? Do you want to know what it takes to succeed in this market? If so, you want to listen to Anton Gauffin, CEO of Huuuge Games.
Anton Gauffin founded his first mobile game company, Gamelion, at the beginning of the mobile games era in 2002. In 2007 he sold the company, but in 2014 had the opportunity to buy it back and didn’t hesitate for an instant. Anton renamed it Huuuge and changed focus to social casino where he knew there was a lot of room to innovate.
At Casual Connect Europe, Anton, participated in a discussion of the latest topics in the social casino industry. You won’t want to miss this insights from this CEO of the fastest growing social casino company of 2016 who claims, “We just need more players playing social casino games.” Be sure to watch the video of the session to see the interview by Adi Hanin of Playtika.
For more about Anton’s insights and career, see this article.
Boddiul is the developer of Colonizer, which was made at Game Factory Jam 2016. The game was the top rated title at Game Factory Jam 2016 and Vova was not surprised by this showing.
“Frankly, I was expecting my game to be top rated game among other participants from Moldova,” asserted Vova. The reason is that I am most experienced in Game Jams, like Ludum Dare, but this happened last time, because we managed to involve more and more local developers to participate in large-scale game jams. Experience of my competitors increases, in future it will be tougher to compete even locally.”
The showing at Game Factory Jam 2016 guaranteed Colonizer a slot at Indie Prize Berlin at Casual Connect Europe. “Indie Prize may help me find investors interested in my future projects, but will unlikely help me enhance my current project in this stage of development,” noted Vova. “I will release Colonizer by myself.”