Transcript Casual Games Association ppt Template

Why Mobile Social Games Need a
Platform Now More than Ever
Ethan Fassett
SVP of Product
GREE Overview
Japan’s Leading Mobile Social Gaming Platform
Tokyo
Founded
December 2004
Founder & CEO
Yoshikazu Tanaka
International
San Francisco
Founded
January 2011
CEO
Naoki Aoyagi
OpenFeint Overview
Leading Mobile Social Gaming Ecosystem
• Mobile social gaming standard with millions of users globally
• Cross platform ecosystem: iOS + Android
• Open source & customizable UI
• Founded in April 2009 in Burlingame, California
• Acquired by GREE in April 2011
GREE Financial Overview
Net Sales & Operating Profit*
USD (Millions)
USD
2007
2008
2009
2010
2011
Net Sales
3.8M
34.6M
164.1M
414.5M
750M
O. Profit
△1.2M
12.3M
98.4M
230.3M
370M
800
700
600
• $5 Billion market cap
• Fastest Growing Tech
Company in Japan*
with 2,636% revenue
growth over three
years
500
400
300
200
100
0
2007
2008
Net Sales
* Fiscal year-end, June
2009
2010
2011
• Net sales and
operating profit grew
36% and 35%
respectively over Q1
to Q2, FY2012
Operating Profit
* Deloitte Technology Fast 50 Japan 2010
GREE’s Global Reach
Amsterdam
London
San Francisco
Beijing
Dubai
Seoul
Tokyo
Singapore
São Paulo
Growing User and Game Network
200
8000
Live Games
190+ MM
160
Unique User Accounts
140
7000
Live Games
6000
120
5000
100
4000
80
7500+
3000
60
2000
40
1000
20
0
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
0
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Players (Millions)
180
2010
2010
2011
2012
2011
2012
A Platform Symbiosis
MOBILE SOCIAL DESIGN
Growth in Free-to-Play Games
Game Design Shifting to Freemium with IAP
User Revenue
Premium games
monetize users once
$ Paid
Free-to-play with IAP
Longer play = more $$$$
F2P games monetize
users many times
Virtual goods market
was $7.3B in 2010; will
double by 2014
Source: Zynga SEC filing, via In-Stat market intelligence firm.
Premium
Game
Time game played
Download App
Free-to-Play Games Monetize
16 of Top 25 Grossing Games are Free
Source: iTunes store January 18, 2012
Free Apps Increasingly Generate Revenue
% of 2011 Apple App Store Revenue from Free
Apps
Source: Distimo Report, 2011 (* Top 200 grossing iPhone apps in the US per month)
Goal of Freemium Games
Increase Player Lifetime Value (LTV)
Lifetime
Value
(LTV)
=
Revenue
X
Per User
Player
Engagement
Cost Per
Acquisition
(CPA)
Goal of Freemium Games
Minimize Cost Per Acquisition (CPA)
Cost Per
Acquisition =
(CPA)
Ad Campaign Costs + Marketing
Campaign Costs
Users Acquired
through Campaigns
Social Games are Special
Social is a unique variant of “freemium”, that
uses social network effects to increase LTV
and lower CPI/A
Lifetime
Value
(LTV)
= Revenue X
Per User
Player
Engagement
Cost Per
Acquisition
(CPA)
Requests
from friends
Network
effects
Game Economics
Notifications
from friends
SNS or social platform
Social Gaming Ecosystem
Social Games are More Efficient on Platforms
Facebook: Users Start with SNS, then Discover and Play Games
Mobile: Users Start with Games, then Tap into SNS
Benefits of Social Games Ecosystem
Optimizes Acquisition, Retention, Monetization
Acquisition
SNSSNS
Retention
• App portal optimizes distribution
• Cross promotion builds user base
• Social & communication tools engage
users
• Games and platform engage users
• Viral effect cross games
Monetization
• Standard virtual currency across all
games on platform increases ARPU
Why Fragmentation is Inefficient
Inhibits Acquisition, Retention, Monetization
Ad Networks
Native Services
&
Weak Channels
Limited
Economic
Scale
Acquisition
Retention
Monetization
Multiple
campaigns
Avg optimization
“Loose coupling”
of users
Email, SMS,
notifications
Dependent on
retention
Univ. currency,
VG tools
High cost
Lesser results
Low retention
Difficult to
increase ARPU
Platform Examples: JP & US
MARKET COMPARISON
GREE Japan Platform
Users (Millions)
Grew as a Game Platform on a Carrier Platform
1st mobile
social game
launches
60
GREE goes
public
50
40
30
Carrier Users
Japanese
Mobile Carriers
GREE Users
20
10
GREE
0
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
World’s First Mobile Social Game
GREE’s Tsuri Star Shows Early Design
Launched in 2007.
Successful for over 4 years.
Goals are to fish, buy special tools,
participate in events, and show off skills.
Why so popular?
•Popular hobby
•Simple rules
•The more you play, the more you discover
– simple but involved game play
Facebook & Zynga Users
Daily Active Users (Millions)
Zynga DAU Grew on Facebook Platform
483
500
450
400
350
327
300
Facebook DAU
250
Zynga DAU
185
200
150
100
50
50
0
1
3
6
2004
2005
2006
Sources: Zynga SEC Filing and Facebook SEC Filing.
58
48
62
25
2007
2008
2009
2010
2011
Zynga Revenue Growth
CityVille
$1.13B *
500
$1,200
$1,000
Farmville
Café World
400
$800
Zynga
Annual
Revenue
300
$600
$598M
200
$400
Facebook
DAU
100
$200
$122M
$50M
Zynga
DAU
0
2004
2005
2006
2007
2008
2009
2010
$0
2011
Note: FY 2011 Zynga revenue is speculated based on the assumption that Q4 revenue will be the same as Q3 revenue.
Revenue (Millions)
Daily Active Users (Millions)
600
Case Study: Zynga
Zynga Spent $120M on Marketing (Jan-Sep 2011)
A
B
Acquired 400K new users
Acquired 1M new users
Each new user
spends $150
Each new user
spends $150
Lost $150 Per New
Paying Customer
Earned $30 Per New
Paying Customer
Sources: http://www.pocketgamer.biz/r/PG.Biz/NaturalMotion+Games+news/news.asp?c=37153
http://www.gamasutra.com/view/news/39747/Analyst_Zynga_is_losing_150_per_new_paying_customer.php?utm_source=feedbu
rner&utm_medium=feed&utm_campaign=Feed%3A+fingergaming+%28FingerGaming%29
Emerging Mobile Social Platforms
CURRENT GLOBAL
MARKET
High-DAU vs. High-ARPU
Strategies Differ with Platform Conditions
CityVille
Kingdoms of Camelot
•10MM+ DAU
•Highest MAU FB game
•Lions share of FB users
•Leverage DAU to cross
promote other games
•
•
•
•
210K DAU
High % paying users
Maximize LTV
Competitive strategy in
consolidated market
NimbleBit: Tiny Tower
Mobile Social Game Without a Platform
Social games can be
successful without platforms
and viral friending loops
Apple named Tiny Tower the
2011 iPhone Game of the Year
Boasts 1 million DAU
Zynga recently announced
similar title on mobile called
Dream Heights
Sources: http://www.pocketgamer.biz/r/PG.Biz/Tiny+Tower/news.asp?c=36660
http://www.gamesbrief.com/2011/07/ios-tiny-tower-on-track-to-make-3-million-in-its-first-year/
Global Mobile Market Challenges
High CPA
• App-store trickery
• Limited cross-promotion
• Ad networks dominate
Weak Viral
Engagement
• No clear social graph
• Diffused viral channels
• App-store hides
conversion tracking
… but several platforms are emerging
Potential Platform Landscape
SNS Focus
Social Platforms
Meta-Platforms
Game Focus
OS Platforms
Studio Platforms
Business Strength
GREE Integrates User IDs, SNS, Games, Platform
Business Field
Device
SNS
Game
Mobile
Game
Center
Platfor
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Global
Unified ID
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GREE Platform:
Addressing a Global Mobile Audience
GREE GLOBAL PLATFORM
GREE + OpenFeint
A New Global Platform for Developers and Gamers
7,000+
Games
Social Games
Current
GREE Japan
Platform
27MM High-ARPU
users, plus social
know-how
New Global
Current
GREE Platform
OpenFeint Platform
140MM users
12,000+ developers
GREE Platform Strategy
Offer developers the most robust toolset to take
advantage of the global mobile gaming market
Global
Social
Open
Enables developers to publish games globally and access
the world’s largest mobile social gaming user base
Provides the best in-class APIs for acquisition,
engagement, monetization, and virality
Cross platform with customizable APIs
Comprehensive Offering
150 MM Users
Unified global platform
Cross promotions through
developer announcements
Key regional distribution
partners
Distribution
Engagement
Promotional programs
Acquisition
Localization services
Wall posting
Friend invites
Gifting
Incentivized invites
Social sharing
Social sharing
Push Notifications
Virality
Dashboard access to game
analytics
Universal billing
International currency
management
Monetization
Gifting
Analytics
Game, player, and
monetization data
We’re Hiring! Apply Now
San Francisco office apply at GREEjobs.com
London, Beijing, Singapore, and Seoul offices apply at
corp.gree.net/uk/en/
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Art & UX
Business Analysis
Biz Dev & Operations
Engineering
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Legal
Marketing & PR
Operations
Product
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Thanks! Questions?
@fassetthound