A Marketing Perspective On The Gaming Industry

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This is the first article in a two part series on monetization and gaming in the video games industry. Your thoughts?

When we think about monetizing a game, it often goes back to the usual suspect of either selling the game, selling DLCs, or making it “Freemium” or Free-to-Play with micro-transactions. First off, I want to reiterate that these method works and works well. As a developer, you should have been using them from the get-go in some form or another.
 
I think that one of the issues with Games is the publisher. I look forward to seeing more indie games and more kick starters. Sure I am on the hook for Fallout 4 and how ever many versions of Bioshock they make, but the games that truly inspire me are usually more innovative and I think the tired old way of doing things with these larger publishing companies is holding games back. Without those publishers draining all your funds maybe games could be more profitable

Stop pre-ordering games, stop asking me to pay for a DLC you have no even considered making yet. Games can be a work of art, something amazing that is part of history rather then some junk you conned millions into buying.

I am okay with Free-to-play with micro transactions as long as they do not limit my game play at all. RIFT managed to do it right IMHO, but they were a pay to play game to start, Most games that start out free-to-play seem to screw this up.

I am good with DLCs if they offer a decent amount of content.

These mobile games that constantly want you to spend money, they are evil and should be abolished, I will never play them. They intentionally roadblock you to encourage spending.
 
zaniix said:
These mobile games that constantly want you to spend money, they are evil and should be abolished, I will never play them. They intentionally roadblock you to encourage spending.
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Fallout Shelter is one of the first games like this I spent money because it didn't feel like I had to.

I think its very telling that in a lot of these games there are options for $60 to $100 dollar packages. While I don't think that is a horrible price for game that will give you x number of hours of entertainment these mobile games don't have the complexity or content that should get these prices imo.
 
Freemium is a scourge on mobile. Something like HotS, I can appreciate the freemium model; doesn't change the game in any way.

But with mobile phones getting so powerful (my S6 edge has 8 freaking cores), every single game is pay 2 win, and I can't blame the developers to much - they rake in the money. Idiots playing grind it out kingdom building games, where people pay thousands of dollars to simply advance time over other people are all the top sellers - hell, they have Mariah Carey in their commercials now. :eek:
 
Could have told you this without reading the article.

Problem: AAA game development costs keep going up.

Problem: AAA game purchase prices have not risen since 2005.

Solution: offer "limited-edition" premium editions at higher price with a token trinket, access to beta tests and other perks.

Solution: break-up the intended game content and sell it as an expansion.

Problem: most people do not want to pay money for mobile games

Solution: add advertising to a game, license game trademarks for product placement,

Solution: design game to make freemium features worth paying for.
 
Tak Ne said:
Mostly due to marketing. They flood every possible promotional channel with so much hype and bullshit in the hopes of drowning out any negative views.

See also: Hollywood Accounting
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Someone gets it. Put the money into making a better game, and stop throwing money at people who couldn't figure out what they wanted to be and have no practical skills, so they checked "Marketing" on their college application.
 
Skimming that article felt a lot like trudging through a particularly noisome sewer. I don't like almost every single idea/concept that he brought up, and I don't buy games I know incorporate many of those "monetization" concepts. Or, if I do buy a game that, say, uses DLC, I won't buy the DLC. Oh, and if I buy a game that has followed the suggestion in a post above me of splitting up the game to make more money off of it (or using Day 1 DLC), then I won't purchase the game at all.

In a way, this reminds me of what happened with arcade games. Back in the early days, most games were about skill: if you were good, you kept playing until you either beat the game (assuming it had an ending), or got tired of playing it (such as the case of Asteroids, for example). But then things changed, and timers were introduced, some games had HP that constantly dropped and could rarely or never be replenished except by putting in more quarters (Gauntlet is a good example of this): the main point is that skill no longer became the determining factor in how long you played -- it was *a* factor, because if you sucked, Game Over would come faster, but no matter how good you were, you'd eventually have to add more money to keep going.

Arcade games went from being based on skill to being based on how much money you wanted to sink in to keep going. Not *all* of them went that route, but most did.

Computer games used to be sold so that when you bought the game, you bought the whole thing. Some games had expansions made for them, but they were usually pretty hefty additions. Small additions were usually in the form of patches, which were normally free of charge. And we bought the game because they were good games, and we bought additional games in part because we came to trust the developers/companies selling them: they made good games in the past, so we can expect them to sell good games in the future. That's how it was back then.

But then DLC started creeping in. I recall it most clearly when a certain game (*cough* Oblivion *cough*) started offering Horse Armor for purchase. After that, various methods of "monetization" started being inserted into games. Developers stopped focusing on making the best games and instead started focusing on how to monetize their games. Just like games with item shops are shaped to get you to purchase items, games started being designed to utilize monetization concepts, and this became clear to the guys paying for all of this: to the gamers themselves.

Personally, I am not at all happy with these monetization trends. I think they are a detriment to video games in general. If we have to debase games to make them profitable, then there is something wrong with the system, and this method of addressing it isn't going to fix it. But if I had to guess, it's not profitability that is the problem, but trying to "maximize" profits that is the problem. In other words, I think the problem is greed, and that's not a problem I see going away any time soon.
 
The cost of creating art assets is the biggest problem. Bleeding edge graphics are expensive and low return on investment.

The other issue is that once the MBAs get their hand on a creative company, the risk and interesting go right out the window in favor of consistent and profitable. That is until the company goes stale, gets parted, and sold and the MBAs go do the same thing at a different company.
 
Madoc said:
In a way, this reminds me of what happened with arcade games. Back in the early days, most games were about skill: if you were good, you kept playing until you either beat the game (assuming it had an ending), or got tired of playing it (such as the case of Asteroids, for example). But then things changed, and timers were introduced, some games had HP that constantly dropped and could rarely or never be replenished except by putting in more quarters (Gauntlet is a good example of this): the main point is that skill no longer became the determining factor in how long you played -- it was *a* factor, because if you sucked, Game Over would come faster, but no matter how good you were, you'd eventually have to add more money to keep going.

Arcade games went from being based on skill to being based on how much money you wanted to sink in to keep going. Not *all* of them went that route, but most did.
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Arcade game design has ALWAYS been about maximizing money returns from games.

Early games had no continues because there was no content. The platform could barely store enough code for the game engine, and some basic graphics, and additional "levels" were mostly rearranging and palette-swapping assets. If they allowed continues, then people would finish the game in under 30 minutes and move-on.

So you target skill-based play in early games because it's the easiest thing to implement a basic "AI" (Pong), or fairly obvious patterns (Space Invaders). If you made the game too hard, or used an uninteresting hook, the game failed. But if you hooked people, players would stick around until they beat the game or got tired of the chase.

Then new arcade games had to change (1) to compete with older games, and (2) to differentiate themselves form home console games, which had captured the early arcade almost perfectly.

So they added more "content" with tile engines, real long storylines, and larger levels. In order to not scare people away from these multi-hour games, they added continues.
 
Anyone who listens to that man is going to fail hard. First thing you should always do is make a good game. Forget about monetization. It only works if you're releasing an expansion. DLC's and for the most part micro transactions is what is killing a lot of games right now. The only reason for this is game design.

World of Warcraft is suffering from this right now. They're losing players faster than the migration crisis. This is because the entire game is built around the subscription and micro transaction system in the game. This results is gameplay that's less about skill and more about forking over money. That guy riding that sparkling didn't kill a giant boss to get it, but instead payed $35 from the store. The reason so many things in the game take up real world time is because of the subscription plan. Why do you have to wait 10hrs for something to finish? Why are you limited to raid once a week?

For same games it works like Team Fortress 2. The hat thing works cause the game is free. And for the most part nobody cares about wearing hats. On the other hand World of Warcraft is a game originally built on climbing a ladder to be successful and powerful. Now it's all about showing off your outfit, pets, and mounts you acquired in the game. Thus ruining the experience.
 
The problem is entitled gamers who think monetization is a bad thing.

The prime example is the post above. Wow proved the model is successful. Provide another example of a 10 year old game that i still bringing in the money Wow is able to generate. The ROI on Wow is an investor's wet dream.
 
Although games and game developers have to find effective ways to recover the costs of their games and make profits they also have to do it in a way that doesn't damage their IP or company reputation ... although all the methods mentioned can work they do not work universally ... perhaps it will be in the second part but case studies of how companies have successfully used those methods (and others) to monetize their games and IP might be more useful

Bethesda has done a good job with monetizing DLC with their games (although their attempt at monetizing the 3rd party mods didn't work out so well) ... Blizzard has done a good job with incremental development (Starcraft 2 three part saga, D3 and its expansion and possible new expansions, etc) ... Bethesda also did well with their Fallout Shelter mobile game used for free advertising (and still made money in that role) ... that model would likely work for Blizzard (Diablo and Starcraft themed mobile games) and Ubisoft (Heroes of might and magic themed mobile game)

Secondary merchandising has worked very well for both Bethesda and Blizzard ... Fallout has monthly new t-shirts and Bethesda has a whole collection of of other collectibles available ... Blizzard has done well with some collectibles and with other items like books and novels (something Bethesda has been weaker in but seems to be adopting this time around)

Bottom line (as others mentioned), if your game is good then you can monetize through many secondary channels (novels, audio books, comic books, soundtracks, art books, DVDs, etc) ... if your game is good then you can use DLC as mini expansions or full expansions to further monetize the initial release ... if your game is bad then no amount of monetization will save it because no one will buy anything
 
After reading the first few paragraphs I had to stop. Everything he's saying is what's wrong with the industry. DLC, micro-transactions... putting limitations in that you have to pay to remove? To hell with all of that. Here's how to sell me a game:

1) DON'T RELEASE A BROKEN GAME. Do SOME bug testing before going gold. No, really. It's not that hard.

2) Don't charge $60 for a $30 game. Seriously... I'm not going to pay that much. I'll wait for it to hit the bargain bin. This is why I bought Shadow Warrior but waited on Doom 3. It's not that I disliked Doom 3 - quite the contrary - but I can spring $30 for a good game. I can't justify $60. Drop the price a bit and sell more copies.

3) Demos sell your game. Remember something called Shareware? Yeah, it's why I own just about every Id title there is. Let me play a little bit, then if I like it I'll buy it.

4) Do something different. Copying mechanic A or premise B because "everyone else that's making money is doing it" is bad. If I want to play Call of Halo I'd buy Call of Halo. Don't make a cheap attempt at a clone and try to cash in on some "trend". You're not fooling anyone.

5) Want more money? Then give me extras. Make a mission pack. Make a side story, or a prequel, or something that adds depth to the game I already like. Quake and Quake 2 did this right. Call it DLC if you want, but make it more than just "$20 will give you this awesome uber gun of death you can't get any other way!" That kind of crap just ticks me off.

6) If it's a PC game, take advantage of what the PC can do. Don't just do a rush porting job on a console title. PC gamers like to tweak to get the fastest, smoothest, and most graphically awesome experience we can. LET. US. TWEAK.

7) No BS DRM. I'll pay you for your game. Don't put crap on the disk or download that can cause problems with my computer and make other stuff not work right. If you do this, I WILL hate you forever, never buy any of your stuff again, and tell everyone I know not to buy your game. It's simple: I want to play your game but if you fuck up my machine I WILL NOT FORGIVE YOU.

That about covers it.
 
Madoc said:
Skimming that article felt a lot like trudging through a particularly noisome sewer. I don't like almost every single idea/concept that he brought up, and I don't buy games I know incorporate many of those "monetization" concepts. Or, if I do buy a game that, say, uses DLC, I won't buy the DLC. Oh, and if I buy a game that has followed the suggestion in a post above me of splitting up the game to make more money off of it (or using Day 1 DLC), then I won't purchase the game at all.

In a way, this reminds me of what happened with arcade games. Back in the early days, most games were about skill: if you were good, you kept playing until you either beat the game (assuming it had an ending), or got tired of playing it (such as the case of Asteroids, for example). But then things changed, and timers were introduced, some games had HP that constantly dropped and could rarely or never be replenished except by putting in more quarters (Gauntlet is a good example of this): the main point is that skill no longer became the determining factor in how long you played -- it was *a* factor, because if you sucked, Game Over would come faster, but no matter how good you were, you'd eventually have to add more money to keep going.

Arcade games went from being based on skill to being based on how much money you wanted to sink in to keep going. Not *all* of them went that route, but most did.

Computer games used to be sold so that when you bought the game, you bought the whole thing. Some games had expansions made for them, but they were usually pretty hefty additions. Small additions were usually in the form of patches, which were normally free of charge. And we bought the game because they were good games, and we bought additional games in part because we came to trust the developers/companies selling them: they made good games in the past, so we can expect them to sell good games in the future. That's how it was back then.

But then DLC started creeping in. I recall it most clearly when a certain game (*cough* Oblivion *cough*) started offering Horse Armor for purchase. After that, various methods of "monetization" started being inserted into games. Developers stopped focusing on making the best games and instead started focusing on how to monetize their games. Just like games with item shops are shaped to get you to purchase items, games started being designed to utilize monetization concepts, and this became clear to the guys paying for all of this: to the gamers themselves.

Personally, I am not at all happy with these monetization trends. I think they are a detriment to video games in general. If we have to debase games to make them profitable, then there is something wrong with the system, and this method of addressing it isn't going to fix it. But if I had to guess, it's not profitability that is the problem, but trying to "maximize" profits that is the problem. In other words, I think the problem is greed, and that's not a problem I see going away any time soon.
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I completely agree with you; this is why I haven't played any of those games.

If epic hadn't bought and closed gamespy, then there would be no market for any of the new games.

Anything that modifies my hit percentage artificially doesn't get bought at all, or anything with a "marketplace", subscription, or "in-game money".

That makes it much easier to decide what sucks. :)

Marketing Douchebags like this guy are what killed gaming; SJW's notwithstanding.


I can still play lan games over a vpn with friends, even if they won't play on the web anymore.
 
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