Nihao! Hello and welcome to China! Most game developers in the mobile space are starting to branch out and look to other markets. There’s been some strong interest in China. With over a billion people and about 400 million smartphones being used in China according to IDC, most developers are drooling over the idea of making a game for the Chinese market. Consultant for the Chinese game market Luke Stapley tells more.
Jonathan Flesher is the Executive Vice President for Business Development at Betable, a company that is changing entertainment by merging the worlds of gaming and casino-based entertainment. For developers who want to offer real-money play in their games and apps, Betable legally enables them to do so without having to acquire their own licenses.
Jonathan runs Betable’s business development and partnerships. Because Betable is an early stage start-up, he is involved in many aspects of the business, from signing development partners, to working to obtain licenses in new jurisdictions, to signing vendor contracts. His previous work with Zynga and Electronic Arts has given him valuable perspective in this new company, which is a platform that partners with game developers. He came with a set of contacts and friends in the industry, as well as an understanding of what it is like to be in their shoes and what issues are important to them.
He joined Betable when he realized how deeply the social and mobile gaming ecosystems would be affected by real-money gaming. As soon as a few developers begin making considerably more money than those who are monetizing solely through virtual currency, real money revenues will become essential as acquisitions costs rise. He has already seen the signs of this happening in the UK as online gambling companies start to view virtual as an attractive customer acquisition channel. Betable offers developers a new and complementary way to significantly monetize their user base through real money play. The worlds of real money play and virtual currency are now starting to converge and Betable provides developers with the tools to succeed in this new landscape.
Asia’s Role in the Industry
Asia, as a leader in online and mobile gaming, as well as home to some of the top development talent in the world, is a key component in the game industry as it moves to include real money play. Jonathan believes these outstanding developers will play an important role in making real money content for the global market place. Since online real money play is a regulated industry and not currently allowed in most Asian markets, conferences such as Casual Connect are essential to make connections with local developers that have been successful on a global scale.
Jonathan emphasizes that establishing strong connections in Asia is crucial to Betable’s business, with the ability to partner with developers in this part of the world a major success factor in their real money platform. He says, ”We hope to catch up with existing partners and meet developers interested in learning more about how Betable can help them grow their businesses and offer consumers the best possible real money play experiences.”
What’s the Best Deal?
One of the most significant points in Jonathan’s career came when he learned that the product has to drive the deal or partnership that a company enters into, rather than the reverse. He tells us, “A very smart mentor of mine once said to me that he didn’t care how good the deal was if he didn’t believe in the product. Start with the product first and the deal will naturally follow.” And, Jonathan maintains, your engineering and product teams will thank you.
The best advice Jonathan has for making a better product is to make games fun. He claims that, although this idea is simple enough, we often lose sight of the intangible quality that makes a game entertaining. He quotes a great game developer, Mark Skaggs, who told him, “I wasn’t successful in game development until I stopped making games I wanted to play and started making games other people wanted to play.” Jonathan adds, “Once you have that essential element of fun, then you can leverage all the great analytical tools to make it even better.”
Jonathan came from financial services before joining the video gaming world. But it took him a long time to understand that the “best” deal was not necessarily the “right” deal. He insists, “In many ways, getting the best deal terms on either side of the table can be counterproductive to a long-term partnership. It’s not a zero sum game.” He feels the best deal is a “balanced deal”, one which each partner can lean into and invest in the relationship. But there is an art to figuring out this balanced deal and it often requires considerable creativity.
“Driven by economic strength, a growing mass of online users and the regional fondness for gaming, Asia is expected to be the world’s largest gaming market in 2013,” says John Cheng, Co-founder and COO of Playnomics. “This represents a huge opportunity for gaming companies to engage and reach this audience and monetize in this key market. Additionally, the gaming market in Asia continues to mature quite quickly: many of the innovative business models in gaming have come out of Asia. At Playnomics, we see that two of the areas representing great opportunity and promise in this market are game analytics and enabling brand access to players. Specifically, the ability to mine players for segmenting and targeted messaging, and the creation of a real channel through games for brands to access Asian customers.”
John oversees product and team development at Playnomics, focusing on maintaining a close dialogue with customers and tailoring products to meet their needs. Through his past experience as an investment banker, John brings a deep understanding of how enterprise software transforms industries, and for this reason, has focused on building analytics software to transform the gaming industry. He tells us, “This understanding of enterprise software has been instrumental in the ever-changing start-up environment, and all contribute to the creation of an extremely data driven product.”
Adapting to the Asian Market
For companies attempting to succeed in Asia, the biggest hurdle for growing and monetizing is the ability to adapt to this very different market. Asian gamers in major cities have unique preferences and needs in terms of game design and mechanics, content and incentives, and payment methods. Japanese gamers emphasize character design and character building in games, so arcade games are less likely to perform well there. Chinese players prefer in-app purchasing to subsidize their game play costs; in all other markets, subscription is dominant. At Playnomics, they focus on capturing and analyzing all the data points around how people play and engage. Data targeting and hyper segmentation enables developers to customize the gaming experience to players, ultimately resulting in higher engagement and monetization.
Since the ability to adapt is a key success factor in Asian markets, John feels that gaming companies should put more effort into collaborations, including cross-country and cross-platform. Games should be developed to be more versatile and work across platforms. And gaming companies should seek to leverage partnership advantages when entering Asian markets. At Playnomics, they developed the PlayRM Platform to meet this challenge. It enables gaming companies to segment their players into groups based on their observed and predicted behaviors which enables the delivery of just the right message to the right player at the right time. This is particularly useful in Asia where major markets are all different and unique. Leveraging PlayRM, gaming companies can successfully segment gamers in order to monetize their games locally. In addition, Playnomics unlocks key psychographic profiles of players enabling brands to reach their specific target Asian audience.
John tells us that the greatest moment of his career was when he decided to leave the banking industry to start Playnomics. He asserts, “We’ve captured over one hundred million player profiles across our platform across hundreds of social, mobile and web games. We continually innovate and launch new products that support our partners, and work with more and more of the leading companies in gaming – there’s no place I’d rather be.”
The biggest challenges for any start-up, as John insists, revolve around resources and growth. At Playnomics, they have been quite successful in gaining the support for future growth, recently closing the Series B round led by Vandage Capital. John feels they were helped to gain this support by their track record of proven success and their laser-focused vision as an organization.
Big Ideas in Store
Due to their focus, they have some big ideas that John announced at Casual Connect Asia:
First, PlayRM Behavioral Push is available for iOS and Android developers. A key feature in the Playnomics suite of proactive audience management tools, PlayRM Behavioral Push enables developers to increase user engagement by sending targeted, real-time messaging to individual players based on in-game behaviors. As the market has shifted from boxed products more to free-to-play online experiences, the need for real-time marketing has dramatically increased. Playnomics identified this market need; specifically that a real-time personalized response to players for retention and monetization is the key to success in the free-to-play market.
Second, PlayRM Revenue is a new product offering that enables game developers to monetize players effectively and brands to engage new audiences in a meaningful way. Developers can reach over one hundred million dynamic player profiles across social, mobile and browser games already in the PlayRM platform. Game publishers face the challenge of maximizing revenue from all players – driving revenue from loyal customers and whale spenders – while other players go un-monetized. Within PlayRM Revenue, publishers can protect their best players, and show only third party ads to the player segments they want to monetize to the fullest potential. Brands create demand in the market place by selecting key audience segments to engage with advertising. John is excited that both these products will now be available.
Gewben Wu is a Business Development Director at Fortumo, Ltd., an international provider of mobile payment solutions for web services and mobile applications in more than 70 countries. Like other companies at Casual Connect, Fortumo is focus on emerging markets. Gewben states that his entire view of the company changed at GDC 2010, when their close association with Rovio began. Android was a new platform then, but Rovio’s commitment to the platform indicated to Gewben that there was indeed mobile revenue to be made on Android.
At Fortumo, Gewben is responsible for the Asian office, where be brings six years game industry experience in management, sales and marketing. Before joining Fortumo, he helped set-up overseas businesses for several leading Chinese game companies, including Snail Game, Renren Inc. and Perfect World, helping. He feels this experience gives him an advantage in his present position.
“The greatest moment in my career came when I joined the Fortumo team,” Gewben says. “I was able to bring global payment solutions to well-known Asian developers and phone manufacturers. Together, we created totally new things that have benefited the industry.”
Joining Fortumo meant a significant change in direction for him, as the payment solution was quite a departure from a more traditional online game industry. His new role requires him to think differently about industry trends and consider the best ways to promote the Fortumo service to Asian developers and app stores. Now the Fortumo Asian team not only provides a global payment channel, it also helps developers release apps to the worldwide market. The key aspect of the Fortumo service is that it is free.
Focusing on the Big Picture
Gewben has learned to understand what developers are thinking, and discuss what developers want to know, enabling him to help them in different ways. He emphasizes helping people holistically by focusing more on the big picture rather than only what is directly in front of you. He points out that the economies of Asian countries are growing at a phenomenal rate, with over half the population of the world living in this area. By contrast, the Western game market is much more saturated, competition is tough and it is difficult to gain visibility. He says, “Game companies which have been successful in the West have huge revenue potential in Asia simply because of the enormous base of potential users. The greatest difficulty they will face is adapting games to the local culture and playing habits.”
Gewben suggests that mobile operators should carefully consider how they want to be involved in the app ecosystem. He also notes that change in market takes time because the huge telecom companies are working with some solutions that are more than a decade old. In order for operators to stay relevant and provide competition to credit card companies, they must update their payment solutions in cooperation with app developers and mobile payment providers.
At Casual Connect Asia, Gewben announced Fortumo’s partnership with a large Asian phone manufacturer. This was also announced in the Western media.
David Worle is VP of Content Acquisition with WildTangent. He and his team source games for the WildTangent Game Service and work directly with developers to license and publish their games. David continues to be impressed with the scale of this business, in awe of the huge numbers of people playing the games on their service. He says, “Each week, these millions come to us looking to have fun. That’s an awesome responsibility that we take very seriously.”
David has had many milestones in his career, including his first multi-million purchase order from Costco, his first retail game launch, and the first time he produced a game. He says these were all fantastic moments, but what really excites him is the next moment. He insists, “My current list of goals is what really gets my blood pumping when I get drive to work in the morning. How many people get to work in the game industry doing what they enjoy? It’s a privilege I never lose sight of.”
But David’s career has also included challenges. One that stands out to him occurred when he was Director of Sales for a retail software company. His boss wanted him to place a title in a particular store in the US. “I had tried several times with my practiced and somewhat formal sales pitch and had been turned down each time,” he says. “My boss/mentor simply would not accept ‘No’. He just said I had to get it placed. It became a daily point of contention between us. I became desperate and very stressed out. Either I had to give up and quit this job I really loved, or I had to find another way to achieve this objective.”
Running out of ideas, David decided to ditch the formal pitch and try to act more natural. “I called the buyer up, and believe me, she was not eager to hear from me, but after five minutes we were both laughing, and finally, she said ‘Yes,'” he says. “What I realized was that I gave up on myself too early. When I told my boss it was placed, he simply said, ‘I knew you would get it done.’” From then on, David has always focused on the result as more important, rather than the steps taken to get there. “Focus on what you want to achieve and make it happen,” he says. “Kick the door down, climb through the window, do what it takes to reach the objective.”
Additional advice for developers is to take the extra time to polish your game. He tells us, “Nine out of ten titles we see lacks the final effort to make it as good as it should be. That last effort separates the good titles on our service. Also, the monetary performance of a well-polished game versus a game not polished can be one hundred times better. Literally.”
Asia and Beyond
David points out that Asia’s importance in the game market has become increasingly evident. It has become a great source of new games and new monetization models. Free-to-play games were pioneered in Asia, so anyone not paying attention to this area is going to miss out on important trends that will find their way into every market.
At Casual Connect Asia, David announced that WildTangent has new carrier and OEM distribution partnerships, adding AT&T, ASUS and Sony to their other partnerships. He believes the explosion of mobile gaming is the most disruptive opportunity of the past ten years. This opening led WildTangent to expand their game service from PC to Android and to extend mobile into their advertising products.
The biggest challenge to the industry is localization and distribution.
At App Annie, Junde manages the APAC business. His main responsibility is to bring in revenue, which in his case goes well beyond direct sales to include localized marketing, consulting, networking and building relationships. Junde tells us, “I’ve always been in start-up mode, so having a background that includes sales, product development and marketing has its advantages.”
The biggest challenge to the industry, Junde believes, is localization and distribution. He points out that there are excellent opportunities for companies with great games so long as they emphasize localization. He tells us that companies can reap enormous rewards of one to one and a half times their Western revenue. However, he maintains “Effective localization is much more than mere translation. There are specific themes and characters that Chinese, Japanese and Korean audiences appreciate. There are also specific hooks for in-app purchases and specific ways of handling local servers.”
China and Japan are growing rapidly on both iOS and Google Play whereas Korea and most parts of Southeast Asia are doing so only on Google Play.
Junde emphasizes the tremendous and constantly increasing opportunities in the Asia with huge mobile growth in downloads and revenue throughout the market. He notes that China and Japan are growing rapidly on both iOS and Google Play whereas Korea and most parts of Southeast Asia are doing so only on Google Play. Junde also notes that single tap app revenues in China, Japan and Korea are no longer less than in the US.
For those looking to enter the Asian market, it is most effective to do so with local offices and local experts. If short term plans do not allow this, he suggests using local partners and distributors to get a feel for the region, rather than diving in with big ad budgets. At App Annie, they take this challenge seriously. They have offices in Beijing, San Francisco, London and Tokyo, with a new office now opening in Seoul. They have local business and market experts, as well as relationships in every territory.
Jhondie T. Abenaza of Zeenoh Games has been passionate about playing games since childhood. His dream has always been to develop his own games and have his own development studio. He has seen how his passion and advocacy can produce more talents in game development, which has kept him going in this industry.
At Zeenoh, Jhondie is responsible for project management. He also trains the people in the company and feels that his previous career experience has been helpful in giving him the knowledge to provide the right training. With a company based in the Philippines, he is in a position to assess the game market in Asia, which he feels is a crucial player in this market since it serves as the gateway where East and West meet. The market encompasses all languages and cultures, so he feels it is a great advantage to have a company in this area.
During Jhondie’s career as a hard-core programmer and developer, he had reached the top level of experience. So the challenge he faced where was to go next with his career, and he decided his direction would be starting his own studio. He strongly believes you should never stop learning and dreaming.
Jhondie has had moments of great satisfaction in his career. One of these occurred when two of Zeenoh’s games were recognized by the Game Developers Association of the Philippines during their Game Development Festival. A second was when they won for the Kiip Build a Fund. He is very excited to see the games they have developed be recognized not only in the Philippines, but also in other parts of the world.
At Casual Connect Asia, Jhondie announced Zeenoh Games will be launching a new game very soon, probably within the next month. He also indicated that they are looking for partners and investors in order to be able to develop more games.
Torsten Oppermann is the founder and CEO of indigo pearl brand communications, a consulting business focused on building successful game brands. He is also co-founder and CEO of indigo pearl games financing (IPGF), a joint venture with a private placement firm that manages a portfolio of game-related investments. For IPGF, Torsten screens target companies, provides management services and oversees the distribution of funds.
Torsten is excited to connect with friends old and new and meet great developers while enjoying Singapore. His enthusiasm for the game business is evident: “I started in 1988 working on Germany’s first gaming magazine, simply for the love of games. It is a creative and fun industry that continues to evolve and amaze me; first from the perspective as a publisher and now as an enthusiast and consultant.”
Peaks and Valleys
Torsten’s most satisfying memory was experiencing the launch of Sonic 2 on the Mega Drive. For every triumphant or epic experience, there are challenges. As the financial market crashed along with the tech boom of late 90s San Francisco, so too did Torsten’s hope of reaching profitability in a massive publishing business. Noting that timing is everything, he simply couldn’t survive such an impossible uphill battle.
These days, Torsten supports the geniuses behind the games: “I enjoy turning products into brands, turning ideas into businesses, starting new businesses and helping start ups get in shape.” Relishing all aspects of the industry, he also participates on a small scale as an angel and frequently advises companies he close to as a board member.
Torsten’s consulting business with his 20 people team effectively drives PR, Brand Partnerships and Social Media to promote titles on a global basis. The business allowed him to help companies from the ground floor as he did in 2006 with E-sports (today BigPoint), but also well-known companies such as CCP, Disney, Nexon, Warner and UbiSoft or Symantec, where indigo pearl develops and executues PR-Campaigns, Social Media actions, Brand Partnerships, etc.
While he misses working on the creative side of the industry, Torsten enjoys running his business and helping others do the same. He maintains that Asia is noteworthy for its heritage in games; Japan was at the heart of the console industry, Korea originated MMO gaming. The future for the region is bright because great content is now coming from China and other Asian countries such as Vietnam. Should regional developers wish to grow beyond their borders, Torsten and indigo pearl are poised to help them to find the right partners.