Friday, February 27, 2009

Facebook game developer Playfish only launched its first game,‭ ‬Who Has The Biggest Brain‭?‬,‭ ‬just before Christmas‭ ‬2007.‭ ‬But it has already generated‭ ‬43m users across its six Flash-based casual games,‭ ‬with‭ ‬21m playing within the last month.‭

As one of Facebook’s most popular app makers,‭ ‬Playfish shows how Facebook can be a gaming platform‭ – ‬and one that’s already,‭ ‬in terms of popularity,‭ ‬leaving Sony,‭ ‬Microsoft and Nintendo in its dust.‭ ‬Investors including Atari CEO David Gardner have put a total of‭ ‬$21m‭ (‬£14.7m‭) ‬into the company,‭ ‬and with the average player spending‭ ‬30‭ ‬minutes with a Playfish game every day,‭ ‬generating between‭ ‬15‭ ‬cents and‭ ‬$1‭ ‬each per month in revenue,‭ ‬its ventures seem astute indeed.‭ ‬


Below is an interesting interview between EDGE and Playfish's CEO Kristian Segerstrale focused on the brave new frontier he’s been exploring.‭

‬Is it fair to say that you’re one of the first‭ ‬companies to think about Facebook and other social networks as gaming platforms‭?


There are a few companies that focus on them as platforms,‭ ‬but we’re the only one with a gaming heritage‭. I think we’re at the bleeding edge of what’s happening in the games industry‭ – ‬we’re making games as a service as opposed to as a product.‭ ‬You don’t buy something up front,‭ ‬you play games that evolve over time,‭ ‬with a free-to-play model and the chance to buy upgrades.‭ That‭ ‬has a lot of implications‭ – ‬you don’t do a marketing blitz ahead of the game,‭ ‬and we ask players what they like and don’t like,‭ ‬and track their data to see when and why they stop playing.‭ We also utilize fully viral distribution,‭ ‬so‭ ‬98‭ ‬per cent of our new players to date come from invites or from seeing on friends‭’ ‬profiles that they’re playing the game.‭ ‬If you look at the top ten apps you don’t see any established IP there.

Why is that lack of known IP so pronounced‭?
The source of trust you get from a known IP like FIFA or Halo gets negated on social networks by the fact that trust instead comes from friends‭’ ‬tastes in games.‭ ‬Also,‭ ‬it’s free to play so you can try games out.‭ ‬We’re also philosophically different from other game companies:‭ ‬we fundamentally‭ ‬try to make games that are for people to play together.‭ We appeal to social emotions,‭ ‬like a game of cards‭ – ‬it’s not you and the cards,‭ ‬it’s about what’s going on between the people playing.‭ ‬Research we did into Who Has The Biggest Brain‭? ‬said that the average player played well over‭ ‬50‭ ‬games of five minutes each,‭ ‬and we couldn’t believe that there would be that much value in that game.‭ ‬And it all comes from the fact that the emotional driver for playing is not you beating your own score but finding out how good your wife or friends are.‭

Why do you think traditional game-makers aren’t leading this sort of online gaming‭?
There are actually fewer serious companies doing what we’re doing than we thought there would be,‭ ‬but you need to operate a service and not a product.‭ ‬It’s pretty hard‭ – ‬we had to brainwash‭ ‬ourselves to not think in terms of a release schedule and a marketing plan,‭ ‬and instead think:‭ ‘‬What are we doing for our players this month‭?’ That’s a fundamental change.‭ ‬It’s very much about monitoring and deciding whether incremental changes are worth it,‭ ‬and this is uncomfortable for companies that think of games as products.‭ We also require an eclectic range of skills and expertise,‭ ‬and cope with‭ ‬3.5m players per day,‭ ‬something an internet company is comfortable with,‭ ‬but not necessarily a games company.‭

Do you think that these companies can apply traditional game design to social networks‭?
On the design side EA has done a fair amount of work,‭ ‬but,‭ ‬not to cuss EA,‭ ‬particularly as they’ve done some pretty cool stuff,‭ ‬I think they’re having a challenge designing social interaction for social networks.‭ ‬If you have a bunch of designs for other‭ ‬platforms and you’re told to make them successful on social networks,‭ ‬the first idea is to just convert the game to Flash,‭ ‬add a leaderboard and launch it.‭ But if it’s not designed to be played socially or isn’t free to play,‭ ‬it won’t work.‭ ‬It won’t distribute or make money.‭ ‬But if you have a product that you’re used to consumers paying‭ ‬£20‭ ‬or‭ ‬£30‭ ‬to play,‭ ‬do you really want to give it away for free on a social network‭? ‬Yet you have to destroy some value in order to make a new kind of value.‭

Do you consider it a risk to depend on Facebook and the other social networks‭?
Sure there’s a dependence,‭ ‬but there’s a dependence both ways.‭ ‬One of the reasons for‭ Facebook’s success is it allowed third parties to make applications.‭ ‬And one of the things we’ve invested in from the start is to try to be as helpful to Facebook as possible because the relationship between an app maker and the network can be symbiotic.‭ We answer for a lot of the time spent on Facebook today,‭ ‬we drive new users into it and we give reasons for people to connect with their friends.‭ ‬Quid pro quo,‭ ‬they provide us with the ability to spread virally and to have access to people’s friend relationships.‭

Freebies + Social Media = Hot Restaurant Strategy



Earlier this month, Denny's gave away more than 2 million Grand Slam Breakfasts in one day with the help of a Super Bowl commercial and online chatter.

This week, Quiznos gave away a million subs in three days after using only banner ads, Facebook and Twitter presence and some free local radio exposure.

Denny's may have been investing in brand awareness, but as the Quiznos promotion demonstrated, with consumers looking to save every penny they can, you probably don't need the Super Bowl part to drive a freebie.

Another current example of using a giveaway and online chatter to drive restaurant traffic: International House of Pancakes just completed its third annual National Pancake Day on Tuesday, in which it gives away a small stack of pancakes and in return asks customers to consider donating to the Children's Miracle Network or a local charity.

IHOP, which has raised nearly $2 million for charities since starting the day in 2006, relied on a dedicated Web site with a "tell a friend" pass-along application, its normal presence on key social networks and some PR to drive awareness and traffic.

The result? IHOP has not finished tallying, but the chain was shooting for $1 million and believes that this year was its best in terms of awareness, traffic and donations, according to spokesperson Patrick Lenow. "The word-of-mouth generated through social networks was just incredible," he says.

And that's just this month's roster of freebie-based promotions designed to draw in new diners, get existing customers to visit more frequently and pick up some revenue from the beverages and other purchases that usually accompany the freebie.

Social networking and restaurants are a logical match. Food is naturally social. Where do you want to eat? Do you want to grab something here? This is translating to online conversations around restaurant brands. Recently, we've seen tremendous adoption of social media strategies among QSRs and fast-casual restaurants.

Combine social media with freebies, and you've got marketing dynamite. Giving away food in these uncertain economic times obviously resonates strongly with consumers. Huge gains are being made by brands who are reaching out to consumers with something tangible. IHOP deserves kudos for taking it important steps further by giving back to the community and forging loyalty along the way.

Denny's SMI score more than doubled (from 22 to 45.6) after its commercial and meal giveaway. Quiznos' jumped from 12.4 on the first day of the promotion to 16.1 three days later, or by 30%. IHOP's score was 36.9 on Jan. 1 and 73.9 on Feb. 25, the day after Pancake Day--a 99% gain. The WOM for IHOP's event was largely organic rather than IHOP-driven, presumably because of the event's charitable mission. IHOP has a formal Facebook page and more than 27,000 fans, but there was no call-out of the Pancake Day event on the page. There were about 135 different events created around Pancake Day, but it looks like none were created by IHOP or connected with the Facebook page. They were created by Facebook users and some IHOP franchisees, and so lacked a cohesive or core message.

IHOP and other brands could benefit from more compelling Facebook pages, perhaps incorporating surveys, polling and a restaurant locator. Providing franchisees with the tools to tap their online social circles to market local events is another opportunity, as is capturing event RSVPs to go back to individuals with coupons and other loyalty-building offers.

Consumers Spend Nearly $100 Per For Mobile Apps

Consumers love adding applications to their new smartphones, and they are willing to pay for it. According to ABI Research, nearly 17% of users who installed new applications are spending upwards of $100 adding them--from games to even more specialized business programs--to their devices.

"Compared with the cost of most of these devices, it's the first time we've seen applications exceed the cost of the phones," Jeff Orr, ABI's senior analyst for mobile content, tells Marketing Daily. The level of spending is even more considerable when taking into account that many of the applications come at a low cost--as low as 99 cents apiece in Apple's iPhone App Store, Orr says.

In 2009, companies such as Nokia, RIM, Palm and Samsung plan to launch new mobile application storefronts to keep up with the growing sales of smartphones.

The percentage of people using smartphones is growing categorically. In a recent study, comScore found that the number of people downloading games--the most popular segment of downloads--grew 17% between November 2007 and November 2008. The number of actual games downloaded increased 34% in that same time period. This number is likely to increase as more smartphones hit the market, including a new entry from Palm coming in March.

Tuesday, February 24, 2009

Marketers Adapt as Social Networks Attract Older Demo

Sometime in 2007, the recent grads that made up the core of Facebook came to a doleful realization: Yup, mom and all her friends are on Facebook. The following year it got worse: The once-exclusive club of the young was completely infiltrated by colleagues, bosses, neighbors and others who might not be amused when little Johnny gets tagged in a photo getting totally ripped with his pals.

What's Mama up to? The college set may be alarmed to see relatives in news feed.

What's Mama up to? The college set may be alarmed to see relatives in news feed.

Social networking is no longer a youth phenomenon. As Facebook marches toward 52 million U.S. users (170 million worldwide), the site is beginning to look like, well, America. Which is to say, it looks a lot older. As of January, more than 50% of Facebook users and 44% of MySpace users in the U.S. were over 35 years old, according to ComScore estimates. The single biggest age demographic in the U.S. on both Facebook and MySpace is now between 35 and 44. Indeed, Facebook says its fastest-growing demo is 55-plus.

That's to be expected, and largely due to the fact that both Facebook and MySpace don't have a lot of growing room left among the younger set. According to Pew Internet and American Life data, 75% of online adults 18-24 already have a profile on a social network. "For those to grow, they'd have to have aged," said Deep Focus CEO Ian Schafer. "It's from growth and expansion to ubiquity."

Generally, somewhere between growth and ubiquity is when uncool usually starts to set in. Facebook CEO Mark Zuckerberg backpedaled fast over a privacy flap last week, but the story, which broke on the Consumerist blog, made the NBC Nightly News, a sure sign that Facebook's niche status is over.

With the Cool Kids
So far, Facebook's aging demos haven't turned off the college set: It's the most popular website on campus above Google and Yahoo, according to an Anderson Analytics poll of college students last fall. MySpace has taken a bit of a tumble in the eyes of college students, falling to No. 4 this year from No. 2 last year school year and No. 1 during the 2006-2007 school year.

Even as Facebook ages, users are still exposed to the activities of their friends, and Facebook has added features such as Facebook Connect to encourage users to take those connections with them as they move on to other sites. "Social networking is so engrained into the lifestyle of college students that it wouldn't be any less cool because their parents and grandparents are there," said eMarketer analyst Debra Aho Williamson.

So what does it mean for marketers that social networking is getting older? For Facebook, the upside is they're now being considered for a wider array of marketing budgets. "A year ago, they thought about it as a place to reach people in college or high school; now we're talking about moms, or reaching families looking to go on vacation," said Kevin Barenblat, CEO of ContextOptional, which has implemented Facebook campaigns for Guinness, Microsoft and the Los Angeles Times.

Because of its entertainment focus, marketers still see MySpace as primarily a youth play. Facebook has more users with incomes above $60,000 than MySpace, indicating an older, wealthier audience, according to research from Hitwise. But as social networking becomes more ubiquitous, age demographics become a less important filter than stated interests and other factors. Just as social networks become more of a mainstream marketing vehicle, marketers are watching to see if the phenomenon ebbs, particularly with the young.

Monday, February 23, 2009

Camera Technology... The Next Next Gen in Gaming


Anonymous sources close to Microsoft have confirmed that the company is buying 3DV Systems, a motion-detection interface company.

Speculation mounted last week that Microsoft had tabled a bid of $35 million to purchase the Israeli company, though many questions hung over the validity of the rumours, specifically regarding how a $35 million bid for a company that had just raised over $38 million resulted in an agreement.

Yet Venturebeat claims that sources close to the matter, who were not named, have confirmed the rumours. The news site adds that the purchase price was small due to "the weak economy and the long gestation that this technology is going through".

3DV has been designing its camera technologies for some time; its ZCams are said to be a far more accurate version of Sony’s EyeToy, due to the fact that the devices can interpret how far away a subject is from its lens. The technology had reportedly been used in “advanced defense systems”, and has already been described as superior – in terms of accuracy – to the Wii Remote.

3DV's mission statement is made clear on its website: “The key to making a real difference in the gaming experience lies in the control. Sony acknowledged that, and launched EyeToy, Microsoft followed with their own camera, Vision. Nintendo took it a step further, introducing Wii. But the revolution is still around the corner.”

Wednesday, February 11, 2009

Playing Grand Theft Auto XII for Free?



According to a newly published eMarketer Report free online and ad supported gaming sites have seen a huge uptick in traffic. In fact, they are more popular than ever. And why not - everyone loves FREE. eMarketer points to the economy as a potential indicator for the increase in traffic.

Ad supported online gaming for casual games makes sense. The games don’t cost near as much to develop or market. The revenue needed to sustain a healthy profit margin is significantly lower than that of a top tier online or console games. Still, we see in game advertising in most of the new releases coming out of the major publishers, so we know that a model is in place. Gamers have come to accept this, and some have even embraced it as it adds a dimension of realism to the experience.

So, how long will it be before a top tier publisher releases a $50 million game to the market for free? If you can wrap your brain around that question, here are a few more that need answers:

  • Would this work for packaged games or only online games?
  • How would a 100% ad supported game affect gameplay?
  • How many different kinds of advertising can a game handle without losing authenticity?
  • How would this ad supported model work for “World of Warcraft” or “Prince of Persia”?
  • Can an ad supported game drive $1 billion in revenue in a two year arc?
  • Would it need to?

We’ve been asking these types of questions ever since the appearance of the first in-game ad. Since then, we’ve seen the music industry’s revenue model implode. The film, book and DVD industries are not far behind. As consumer adoption of online distribution of entertainment increases, the demand for packaged entertainment decreases. This dramatically impacts the revenue model for publishers and opens the door to a 100% ad supported video game.

I’m not saying it’s right. I’m saying it’s coming. It may not be “Call of Duty 6″. Perhaps “Grand Theft Auto XII”.

What do you think? Leave your comments below...

Tuesday, February 3, 2009

iPhone Users Embrace Games

According to comScore, the iPhone and Blackberry Curve have replaced low-end phones such as Motorola's RAZR as the most popular mobile gaming platforms.

According to the report, iPhone users made up 14 percent of mobile downloaders in November. Thirty-two percent of iPhone users said they downloaded a game during the month, considerably higher than the market average of 3.8 percent.

Game downloads on smartphones jumped 291 percent year-on-year to 2.9 million during the three-month period ended November 2008. Game downloads on non-smartphones dropped 14 percent to 5.6 million.

Overall, the audience for downloaded mobile games grew 17 percent.

For the same period, 20.5 million users said they played a downloaded game on a mobile device, or 8.9 percent of all mobile subscribers.

“The rapid growth in smartphone adoption in the United States has provided a boost for mobile gaming, as 34 percent of those downloading a game in November did so using a smartphone,” said Mark Donovan, senior analyst with comScore.

“Last year, not one smartphone appeared in the top 10 devices used for mobile downloads. This year, six out of 10 are smartphones, excluding devices with smartphone-like functionality, such as the Instinct and Voyager, which also make appearances.”