Casual Gamers Key To Gaming Success

17 05 2012

While I am certainly not an “expert” in the gaming market, I have made some observations as to where the real money appears to be in the game industry. Guess what: it isn’t on-line or hard-core games. The biggest revenue appears to come from single-player games that don’t require on-line access and don’t have a social component.

On-Line and Social Get The Attention

On-line games and social gaming get a lot of attention. There is always a lot of press about on-line games like World of Warcraft, D&D Online, and Star Wars: The Old Republic. There is plenty of chatter about “social” games, primarily the suite of games built by Zynga. There is no question that these games, and the segment of the game market, represent some serious money and serious numbers.

Consider World of Warcraft, by far the biggest of the MMORPG games out there. It is estimated that it represents $1 billion in annual revenue for Activision Blizzard. There are an estimated 12 million accounts on World of Warcraft. This is certainly a game with serious numbers behind it, and it represents about 25% of all of Activision Blizzard’s $4 billion in annual revenue.

For social games, one of the biggest is Zynga. They are expected to see about $1.2 billion on revenue, primarily from people buying virtual items for their various games. The Zynga games also represent one of the reasons behind Facebook’s success, and the two are interdependent. But there are a lot of people that play these social games.

But Casual and Offline Is Bigger

If you look at the casual gamer market, the numbers are bigger, often an order of magnitude bigger. Consider Rovio: to date, they have seen $1 billion just from game sales. There are 500 million copies of Angry Birds on various platforms and in various forms out there today. This is an off-line, single-player game with no social components. And the game isn’t slowing down any.

Need more? Nintendo is an $8 billion a year company, selling both hardware and games. Most of their games are off-line, and are generally aimed at the casual market. There are about 96 million Wii consoles in use today, nearly 10-times more than World of Warcraft users. Electronic Arts is a $4 billion/year company, primarily on the back of single-player stand-alone games that don’t require any sort of on-line access. The bulk of the Activision Blizzard game line-up involve games that can be played stand-alone, without on-line access, and they are a $4 billion/year company like EA.

Reinforcing this is the profile of the “average” video game player. According to surveys conducted by the Entertainment Software Association, the average video game use is 37 years old, male and has been playing for 12 years. About 42% of game players are women 18 or older, and they are growing in numbers. Nearly 30% of all game players are over 50. The perception is that most gamers are teens and twenty-somethings. The reality is that most gamers are not “young people”, but mature people. Those mature people have money, and clearly they are willing to spend it.

Is On-line Dying?

The past couple of years has not been great for on-line games, in terms of growth. World of Warcraft continues to dominate the space, and their user-base has slowed considerably in growth. The Star Wars MMORPG has seen a drop in the number of account holders. Diablo III’s recent launch was marred by server-side problems, and while it will see a surge in users, it seems typical that a game will see its customer base drop over time. EA is in the process of shutting down servers that support over a dozen different games, all of the older games, simply because they don’t have large active communities anymore.

While on-line gaming certainly isn’t going away, it doesn’t appear to be a growth market. Several new on-line games have appeared recently, and none have been able to gain any meaningful ground on the biggest player World of Warcraft. The game represents a steady source of revenue for its publisher, but it doesn’t appear to be a growth platform for them.

Social games, though, continue to go strong. For the short-term, the growth in the market looks good for Zynga, and there appears to be space for others. How long this will continue, though, remains to be seen.

So If You Want To Build A Game…

It would seem that, if you want to make a game with the highest chance of success, there are some common themes at work. First, the game needs to have strong single-player support, and it shouldn’t require on-line access. Having additional features through on-line and social interaction is good, but clearly it is not essential. It needs to be aimed at the 35+ crowd, since that represents the biggest group of people buying games. Aim for the mature casual gamer, and at least you are shooting at a large target. Trying to sell games for on-line only play, and trying for a younger demographic doesn’t seem to have the same sort of success.

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