SG MONETIZATIONTHE RISE OF SOCIAL GAMES

Mu’min Santoso @msantoz

SPARX UP AWARD 2011 SEMINAR SERIES. JAKARTA, JUNE 23, 2011

Topics• Definition• Overview• Social Game Success Factor• Monetization• Q&A

“Any game where the key game design elements are based on the interaction

between the players”- Klaas Kersting, Gameforge -

OVERVIEW

Ad:tech Sydney – March 2011

HOW DO SG MAKE MONEY?

EVOLUTION?

IT’S CHANGED

WHY CHANGE?CHANGE THE WAY WE PLAY GAME

BORN : 2007

3rdsense – Adtech Sydney

35% Social Gamers have never played a game beforeZINGA’S ‘CITYVILLE’ REACH 100M ACTIVE MONTHLY PLAYERS A MONTH AFTER LAUNCH

RULE OF THE ‘GAME’

RockYou

WHY SOCIAL GAME RISING?

NETWORK EFFECT

SOCIAL/VIRAL

REPEAT PLAY

SOUGHT AFTER

LONGEVITY

REWARDING

5 COMPONENTS OF SUCCESSFUL SOCIAL GAMES

ENGAGEMENT

VIRTUAL ITEMS (VI)- Functional, decorative, gifts, status,

rewards, collectibles- Allow players to set goals (they save

up to buy = long term objectives)- Promote Trading & exchanging

(open up communication between players)

- Large price variants between VI increases overall game depth

- “Rare” or exclusive VI promote a sense of urgency and impulse buys

VIRTUAL CURRENCY (VC)

SOCIAL GRAPH62% of all social gamers play with REAL friends

PopCap, 2010

FEEDBACK

NEVER ENDING GAMEPLAY

UNDERSTANDING MONETIZATION

ARBITRAGE

Monetization Models

http://lsvp.wordpress.com/2008/07/02/29-business-models-for-games/

Keys to MONETIZATION

RockYou

Who Plays SG?

What’s Hot? SPENDER

Spender• Players who spend massively on virtual goods and gifts• Whale: > USD 1,000• Super Whale: > USD10,000• Mafia Wars, Happy Aquarium, etc• Small percentage (10%) of users in the category• Single Minded

Spender

What’s Hot? FREEMIUMMicro Economy:• Virtual Items• Virtual Currency

Via Zerealm

WHY FREEMIUM?

What’s Hot: MICRO ECONOMY (ME)

Drive Action through ME

What’s Hot? CONVERGENCE

What’s Hot? CONVERGENCEMOBILE!

MOBILE?Mobile is the most powerful digital medium

to the date

Why?• It’s a BIG (numbers)• It’s Personal (nature)• It has More Context (Identification of Needs)• It Can Make you Money

Source: Effective Measure, April 2011

61,88 %Mobile Others

38,12 %

24.195.080 people internet mobile

Internet Habitconnect with others

Source: BBC World Service poll, 2010RazorFish 2010

1

2

3

4

search and share information

play games

showing existence

5 ecommerce

IT IS BIG

It’s PERSONAL- 91% of people have their mobile within arm’s

reach 24/7 – Morgan Stanley 2007

- 60% of Married people will not share their mobile with their spouse! – Wired Magazine 2006

- It takes an average of 26 h for a user to report a lost wallet but only 68 minutes to report a lost mobile phone – Unisys Survey

It’s PERSONAL

10% of under-25-year-old find it OK to text whilst having sex Retrevo Gadgetology Report, 2010

Mobile Has More Context• Personal Mass Media• Always Carried• Always On• Built in Billing System• Present at the point of Creative Impulse• Accurate audience identification• Captures social context• Enables augmented reality

What’s Hot? BRAND

3RDSense on Ad:tech Sydney 2011

What’s Hot? BRANDHow Brands can use games?• Advertising around games• Advertising in games• Sponsoring part of games• Taking an existing game & re-skinning it• Creating games from scratch• Creating games portal• Create social game with Virtual Economy

Benefit for Brand• Cost effective form of Marketing• Deep band exposure• Collect Data• Establish a personal connection• Allow customers to interact directly with Brand• Leave people feeling good about your brand• Viral & Social• Great way to educate

LESSONS: KEEP TESTING

TO SUM IT UP• PUMP THE NETWORK EFFECT• ENGAGE TIGHTLY• GRAB THE FUTURE POTENTION• PREPARE REVENUE GENERATOR

QUESTION?

THANK YOU

Mu’min Santoso @msantoz