After the Gold Rush: Competing in today’s App Store
It’s hard to believe that the App Store is only six and a half years old – it was launched in July 2008 with just 800 apps. Now there are 800 apps downloaded every second – 2 billion a month – and the number of apps available has grown more than 1,000 fold to 850,000.
Games dominate this marketplace, with more than twice the number of apps as the next biggest category, and well over 10,000 new ones being added each month. The barriers to entry remain low – you can code and release a simple game on your own – but the barriers to success continue to get higher. This is typical of all markets as they mature, but it is striking just how fast this has happened in mobile, and developers of all sizes are finding the competition fierce. Beyond the sheer quantity of games available, there are three clear indicators of this development.
The top grossing charts are largely static. Candy Crush Saga and Clash of Clans have been in the top 3 games for over 2 years now. These games appear to have locked down their respective genres in the way that Call of Duty or World of Warcraft has on other platforms. Many of the other games in top 10 are similarly long lived, and just two developers: Supercell and King consistently account for at least half of the top 10. Games that do manage to break into the upper reaches of the charts are notable because they are so rare now, and often supported by very strong brands, such as Kim Kardashian.
SuperData estimated that the cost of acquiring a user increased 37% between Jan 2013 and Jan 2014. Machine Zone’s recent $40m advertising campaign for Game of War illustrated just how much money the top companies can throw at marketing. SuperData also reports that CPI now stands at an average of $2.78 for mobile games, whilst average revenue per user is just $1.96 – not a good ratio for developers.
Super Evil Megacorp spent two and a half years developing Vainglory, and it showed – the graphics looked closer to AAA standard than what we would normally expect from a mobile game. Smaller developers can pull off great looking games such as Monument Valley or Badlands, but only when they choose very stylized appearances that facilitate lower costs of production. Even the UI transitions in Hearthstone demonstrate a level of polish that few established studios, let along Indies could hope to pull off.
So where does this leave us? How to we compete in a market that has become this tough? It’s a question that we ask ourselves a lot at Wooga, and even with our current successes (Diamond Dash, Pearl’s Peril and Jelly Splash) something that we are still working out.
How to find success?
Looking at the charts it is clear that cloning games does not lead to success – the only game with similar mechanics to Clash of Clans is Boom Beach, also by Supercell. Replicates of Candy Crush Saga have performed similarly poorly. It is for this reason that we do not clone games at Wooga, and never have. It’s also creatively unsatisfying and for a combination of these reasons many people advocate the opposite end of the spectrum: radical innovation in the hope of striking it lucky.
This was my approach on my last game too. Whilst Wooga has a history of casual, single player games, I set out to make an action strategy game. I loved the genre myself, and felt there must be an audience who were likewise unsatisfied by the current offerings on the App Store. I felt that given the talent at Wooga, our understanding of game design and the amount of user testing we used in the creative process we could make a success in any genre. But in hindsight this approach seems just as misguided as cloning games, as I had failed to recognize the current state of the market and the value of building on existing company expertise, tools and audiences.
Games are complicated systems, especially action strategy games designed to give years of play. We had a good prototype and the gameplay was novel and fun. But the more we worked on the details the more problems we threw up. Exactly because the gameplay was novel, we needed novel solutions to these problems – we could get inspiration from other games, but no one had solved these exact problems before. The team did a great job of working through these, but it took a huge amount of time and emotional effort to be continually rebuilding large sections of the game.
Risk is inevitable
Furthermore, as we worked through design issues, we realized that we were left with a number of risks that we could not remove before launch. By staying true to the vision of the game we had ended up with intense synchronous PvP gameplay that only Hearthstone and World of Tanks came close to. These are successful games, but it seems largely because of their existing PC audience. We also started hearing horror stories about the CPIs for the mid core audience, several times higher than the best LTV any of our existing games had. In combination we were not sure if the audience we were targeting existed, and if it did whether we could profitably reach them.
Despite the team’s enthusiasm for the game I could see that this was becoming a passion project for us rather than a legitimate chance at creating a commercial hit, and unfortunately for those of us that make games professionally, commercial realities cannot be ignored. Eventually I decided it was time to stop burning time and money and start on something afresh with greater potential. I realized that we had been arrogant enough to assume we could build something as good or better than what was already out there, despite having none of the tools, none of the design knowledge, and no audience compared to developers that were already making these sorts of games.
I remembered that Clash of Clans was an iteration on Backyard Monsters and Candy Crush Saga a refinement of Bejewelled. But even before their big successes, Supercell had experienced teams working on Hay Day and Clash of Clans, and King had its casual gaming portal and picked games out of that to develop for Facebook and then mobile. In each case the companies had existing assets that they built on, as well as refining mechanics from other games.
What to do with an existing audience?
A company with the size and track record of Wooga has plenty of assets to build on. We have an existing audience, established IPs, game design experience earned through hundreds of user tests and millions of players on our live games, the know how to set up extensive content pipelines and so on. We hadn’t recognized their value before though, and instead choose to innovate across the board. Our core gameplay was different, our elder game novel, we were attacking a more core audience we knew only as players ourselves. The only asset of Wooga that we really used was building on technical expertise from previous games. In our post mortem we realized this was also the one area that was free from major problems over the course of the project.
Let me be clear though, that when I talk of innovation, I am not talking solely about design. I am talking about all aspects of production from the audience and genre you choose to the technical setup you have as well. Design can be innovative and successful, but innovative designs are best supported when you build on existing assets elsewhere. Hearthstone is a great example of this: the team built on a vast wealth of assets that Blizzard had to make the game a success. There was the experience of the design team, the strength of the Warcraft brand and Blizzard’s ability to recruit half a million fans whilst the game was still in beta. The gameplay was fresh, the genre basically non existent on the App Store, but even from the outset the risks that the team faced were greatly reduced by building on Blizzard’s strengths.
I also believe that this is the case whether you are a mid sized developer like Wooga with 280 employees, or an indie developer with a fraction of that scale. The key is to recognize the particular skills and assets that you have, and the niches where you can best apply these. Smaller companies may need to choose small niches to succeed, but they also need smaller successes to cover their costs. As a smaller company you can serve niches that aren’t big enough to warrant the attention of bigger players. As you serve that niche you should aim to build up tools, marketing channels such as email lists and other assets that aid your future work and thereby grow your business.
Learning from my recent experience, for my next project I will work on something that builds on a far greater number of Wooga’s assets. This is the best way for me to maximize my chances of seeing my game launched and successful – a goal that I am sure many developers can sympathize with. This might sound like a dispassionate approach to making games, but I don’t feel that it needs to be. Like most people in the industry, I work in games because I love games. Building on the assets that Wooga already has may seem constraining given the wonderful variety of games that exist. But it is an additional constraint and not the definition of an entire project, and as the saying goes, creativity loves constraints.
This article was originally published on Gamasutra