The videogame industry has historically tethered users to consoles and computers -- and has primarily developed products for serious gamers. This model has been upended within the past year as a new trove of games has been embraced by casual users and fueled by social networks. These games are played almost exclusively on social networks and handheld devices.
Social games like Zynga's Farmville have cultivated a passionate following largely because they tap into the DNA of social networks like Facebook. They focus on interacting with other members rather than just personal accomplishments like reaching the next level. Online networks provide a fertile environment for games to spread virally and foster social camaraderie among players.
Critically, casual gaming apps for handheld devices, like Angry Birds, also offer simple, short-duration experiences for individual users. They are fun, intuitive for all skill levels and are an alluring diversion during a few minutes of free time.
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Both social and casual games have generated a broad appeal by capitalizing on the growing amount of time that consumers are spending on social networks, smartphones and tablets. Companies are also producing these games less expensively than other types of video games. The low cost allows them to produce a high volume of new games quickly in hopes of finding the next hit. And this strategy is paying off. The number of new social games generating more than one million monthly average users (MAU) increased nearly 290% between 2008 and 2010 (as reported by Facebook and Appdata.com), while Angry Birds has been downloaded more than 200 million times.
Although the recipe for success is different for each product, popular games tend to share two key characteristics:
- Viral Growth ("the Buzz Factor"): The ultimate success of a social game can be measured by its growth in daily average users (DAU). Zynga's Cityville reached an average DAU growth rate of 12% during its first 30 days -- and remains one of the most popular games on Facebook. By comparison, Social Point's Ping Pong is an average performing social game on Facebook that saw a 2% decline in DAU during the first month of its launch.
- Stickiness: For social games with a community focus, their ultimate success is based on how addictive they are to play. One way to measure frequency of play is by dividing the ratio of daily average users by monthly average users (DAU/MAU), beyond the initial 30 days. Cityville slightly grew its frequency of play after the first month, while Ping Pong saw lower game play per user.
But games don't always need a strong start out of the gate to be successful. Based on a random sample of 75 games within the top 500 most popular games on Facebook (based on MAU rank), nearly one-third didn't have a positive DAU compound growth rate within the first month. However, these games proved to be particularly "sticky" and drove increased usage within the user base that discovered them.
So, how many social and casual games are "must haves" for consumers? Not many, according to our research. L.E.K. analyzed a random sample of 75 of the 500 most popular Facebook games and evaluated them on viral growth (DAUs) and stickiness (DAUs and MAUs).
We found that only 8% ranked above average on both attributes. Twelve percent of games had a high level of stickiness, as games like Texas HoldEm Poker from Zynga maintain ongoing interest with a niche audience. And one-quarter of games were above average on viral growth. But within this group, titles, including Mahjong Trails from MegaZebra, generated a good initial buzz, but failed to retain their users over time.
In other words, winning games need both good social features (viral growth) and addictive gameplay (stickiness). Traditional videogame companies need to focus more on social features to compete.
Consumers' increased focus on social media represents an important opportunity for gaming companies that can adapt to the shifting preferences of casual and advanced gamers. Brands that can capitalize on the viral nature of the likes of Facebook, understand consumers' voracious appetite for new games, and can target niche segments of core users will be well positioned for success.
By Dan Schechter, Vice President and co-head of L.E.K.'s Global Media, Entertainment & Technology practice and Brad Finkbeiner, a manager of L.E.K. Consulting.
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Source: http://www.huffingtonpost.com/dan-schechter/winning-moves-for-the-gam_b_922750.html
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