Mobile Gaming is the Way to Go!

I usually play video games to have fun and clear my busy mind, but sometimes I find myself playing a game just to observe the applied user experience and the strategy behind to dominate over its competitors. Recently I’ve started focusing on mobile gaming.

When I decided to try Clash of Clans, I was aware neither how successful and popular game it was nor how valuable the developer company Supercell was. I started to play Clash of Clans in Summer 2013. At first, I though it was a Warcraft classic type real-time MMORPG. After the installation and quick tutorial, I realized that although the logic, setup, characters (warrior, archer, giant, mage etc…) are similar to Warcraft, Clash of Clans brings a really different gameplay and is able to capture gamers like me considering I was never fond of Warcraft and alike.

After the announcement on October 15th that Supercell sold 51 percent stake to Softbank for $1.5 Billion I had a quick look to Supercell:

Supercell is a Finnish mobile gaming company, founded in June 2010. They have 2 major mobile games: Clash of Clans and Hayday. They have developed 1-2 more games, but their focus is on these 2 games only. Clash of Clans is really a hit! It’s one of the first versions of its kind. In a separate post, I’ll share my observations about Clash of Clans from “user experience” and “competition” point of views. Although both Clash of Clans and Hayday were iOS-only games (till Android version launch in October 2013), it’s reported that they were generating $2.4million per day for the company in the first half of 2013.

Clash of Clans by SuperCell mobile gaming company

Mobile Gaming is the way to go

I think nowadays video gaming is one of the rare startup areas where there might appear billion dollars+ valued companies outside US and China. That’s why for the entrepreneurs who don’t have existing strong connections in the US, I suggest going for mobile gaming industry if they really aim for a worldwide success.

Why “mobile”?

Smartphone penetration is increasingIf smartphone penetration was not going up so fast and mobile industry was not growing that fast I would not suggest entering to “video gaming” industry. You had to invest a lot; find tons of developers, designers, 3d engine coders… even story writers and musicians. Traditional games were being developed by 200-300 people in 2-3 years of time. PC games are still in the same situation, we have waited 10 years to play Diablo 3.

Then it comes marketing; supermarkets and video game shops were almost the only channels to promote new PC and console games.

With the “mobile era“, the game has changed:

1. Reduced development costs. A single developer can create a very popular mobile game. With a small but talented team, you can easily compete with 20+ years-old computer game companies. Imagine how big team would “Draw Something” require developing… It had been downloaded 50 million times in fifty days after its release and it’s been acquired by Zynga for $180 million, only a few months after its launch.

2. Low marketing costs. Even amateur developers now have a chance to shine in online application stores. You need a quick boost to position the application to the top. If you can get a position in top 100 or so the rest will come automatically. Online, and mostly social advertisement and viral support will be enough to reach millions of players.

3. Reduced complexity. “Mobile” is aligned with “simple“. Most people do not have “dedicated” time to play games. They start playing spontaneously; while waiting for a bus, while waiting in the coffee queue, in the toilet… This means you’d better focus on simple and quick games rather than complex and long-time taking games. “Simple” is not easy to achieve, but it gives smaller startups opportunity to compete with bigger ones.

4. Easy to monetize. In the mobile world, you do need to build trust to make users pay with credit card. You do need to think about payment channels and interfaces. You just pay a commission to relative application store and done! Instead of trying to sell the game for $30 to everybody in the stores, you get $0.99 from casual gamers, $4.99 from regular games, $50+ from hardcore gamers. It is also possible to convert Ad areas, popups in your game to income.

Why “video gaming”?

Across all the categories in mobile application stores, “games” is the one with the highest number of applications. Why?

1. Everybody likes games! Soon or later… I’m not a good example. I play video games since I was 11. But, don’t you see parents who never played a video game before, were always angry to children about time they spend for games and now feeding sheep at Farmville or competing with Facebook friends at Candy Crush? As the world becomes more competitive and stressful, people need tools to escape from daily rush. The most popular solution is video games. I wish it would be outdoor games, sports, hobbies etc.. But the reality is, it is not. People tend to spend more time with their mobile devices, socialize over a network rather than joining outdoor activities.

Mobile App Consumption, Time Spent per Category and mobile gaming

2. Scalable world-wide. Other areas like e-commerce (any business that involves offline processes) might be scalable in a single country but every new country you jump will bring you new challenges and your success in the new country is not guaranteed. We have seen this at successful Turkish startup Yemeksepeti; they achieved good results at Dubai and meanwhile they decided to shut down Russia business. Similarly, Rocket Internet that have successful e-commerce startups in many countries decided to leave Turkey after 4-5 months of trial. Examples are many actually. In every new country, you’ll need a separate dedicated team as good as the one in your home country and you need the market also be ready for your service or products. On the other hand, unless it has specific cultural touch (e.g. backgammon), video gaming is a global habit. Was there a nation who never played or enjoyed Tetris? I don’t think so.

3. Strong and long-lasting viral impact. A good game will pretty much advertise itself. Gamers often share their experience through the forums. If someone discovers a good game, he/she will share the news with all friends. With close friends, I still talk about the games we used to play 10-15 years ago. Before, Hollywood movies were based on books. Now, we see movies based on video games: Super Mario Bros, Street Fighter, Final Fantasy, Resident Evil, Lara Croft: Tomb Raider, Doom are just a few of them. We are looking forward to the Warcraft and Angry Birds movies. In Final Fantasy or Warcraft, there are stories that can be migrated to the screen but why do you think Hollywood is going after no-story games like Street Fighter, Angry Birds? Because of the popularity of the game characters, briefly the “brand“, to attract a ready audience who would watch the movie just to see those characters.

What is the Challenge?

make it possibleNothing is easy! Challenges make the life fun!

I wouldn’t join to any project or initiate a startup if there would be no challenge. The existence of challenges will give you the opportunity to succeed and create a difference. If you are planning to create a “hit” mobile video game, be prepared for some key challenges:

1. It should be easy to learn how to play. E.g. Tetris
2. It should appeal millions of users. E.g. Candy Crush
3. It should create a brand. E.g. Angry Birds
4. It should be long-lasting, not consumed fast. E.g. Clash of Clans
5. It should be best of its kind. E.g. Hay Day

And all other common challenges like “user experience”, “stable code”, “platform compatibility”, “customer support”, “marketing”, “customer loyalty” etc..

Looking forward seeing new games and growth in the mobile gaming industry! Good luck!

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