The Selling Game: A Video Game Marketing Blog

Brief Update

2009-11-24T10:47:00.000-08:00

I have been very bad at updating my blog, due to my new job taking up most of my time. I'm hoping I will eventually manage to get back to writing about my favourite industry.

In the meantime, I'm entertaining a creative idea for a crazy internet experiment. What I need is the help of a web designer/developer to begin with. Someone with knowledge of international law would also be helpful to brainstorm with. They do not have to be the same person.

If you are curious/interested, email me at thesellinggame@hotmail.com

Cheers,
Taylan

Codemasters' EPIC FAIL

2009-10-10T10:23:00.000-07:00

I don't review games on this blog. There are too many people out there doing that. I usually try to focus on what it means to have a well developed and well marketed game. However, it is worthy of mention when a game does the latter very good and fails colossally at the former, the way Operation Flashpoint: Dragon Rising seems to have pulled off. But still I must admit the real reason I'm writing up this post is because of how bad I feel as a consumer who's been lured into buying their game. I feel so bad that it hurts. Also let me mention that my impressions are based on the Xbox 360 version of the game.

Let's talk marketing then. The concept is great: a military shooter that focuses on realism and atmosphere, summed up by the words "This is not a Rambo game." Great differentiation strategy there. So far so good.

They had a strong brand equity coming from the first title in the franchise, the original Flashpoint, which many people remember fondly. That's a great advantage which they have been able to use to their favor. Still good.

Timing-wise, it was a great window to launch the game; just when people are bored to death by CoD: WaW, and Battlefield 1943, and just before the other strong titles (MW2, BF Bad Company 2) coming out. Even better.

Promotions were exceptionally done, focusing on all the mouth-watering features of the promised game. The constant stream of trailers and developer diaries did a lot to build up anticipaton, all the way to the release day. So all in all, it was great marketing... would you say?

This is why, I suppose, it sucks to be a marketer in the video game industry. Because the most essential component of marketing, namely customer satisfaction, is decoupled from the other functions of marketing departments. So when the game gets in the hands of the gamers and the rubber hits the road, when the horrors of a blatantly unfinished game at $60 bucks are unleashed on the naive and unsuspecting consumer, when all the promises are broken and it all adds up to an overwhelmingly bad customer experience, as a marketer I just grimace and think: this is actully horrible marketing and I know the "marketing department" couldn't have made a difference. Such is the sad state of marketing in this industry.

If you want to know what exactly is bad about the game, I recommend checking the official forum pages. There are more flames there than you could find on a particularly warm day in hell.

You just lost a brand loyal, Codemasters. And I have a feeling I'm not the only one.

How to Create/Market Games for Women

2009-09-29T11:29:00.000-07:00

(Dear readers,

Allow me to introduce you to Julia Barry; song writer, musician, and director of the documentary "In Her Image: Producing Womanhood in America" - a multimedia documentary of how media portray and shape women's lives in America. Julia gracefully accepted my invitation to share her views on video games from a woman's perspective, as a guest blogger. I think you will, as a reader of this blog, benefit from her observations, especially if you are trying to make/market games for women. Enjoy...)

I’m really glad to be guest blogging, and want to give kudos to Taylan for soliciting a female point of view on videogames.

Many people assume that girls and women don’t talk about videogames and media because they’re simply not interested and therefore not involved in it. Being a bit of a tech geek myself who also does work with girls and teens, I can safely say that there are just as many females intrigued and excited by digital tools and toys as guys.

But why do videogames and girls still seem to exist in different realms?

Lets go to marketing, products, and capitalism for a second. Videogames are entertainment products, purely made to be sold to gamers. As far as I know (correct me if I’m wrong), the gaming industry’s main mission is to make money. (The industry has also been at the forefront of developing technology for creating stunning graphics and motion, which is pretty exciting from a tech/art point of view, but is still designed in the service of creating an exciting product that will sell.) The framework of videogames as commercial items leads game-makers and marketers to rely on salient imagery presented at a pulse-thrilling and interactive pace to keep customers coming back.

Unfortunately for girls and women, “salient imagery” today usually means thoughtless sex and violence, both of which we are all made immune to through repeated exposure. This content alienates girls two-fold: 1) girls are socialized not to engage in or like violence, but rather to be thoughtful and nurturing, so taking part in these sort of “boy” games undermines femininity, and 2) even if we are more aggressive and don’t mind playing “boy” games, within the games there is often little room for girls and women. There are usually less (or no) female than male characters; female characters are primarily created of an unrealistic and unhealthy body ideal, wear incredibly sexualized clothing, and act sexually debased; and many tasks a player gets game points for (or even the video transitions that a player watches between screens) involve disrespecting or brutalizing women, or at the least, being thoroughly macho and reveling in disregard for other characters.

All that doesn’t mean girls don’t like the challenge and thrill of videogames as a media or format (many of us do!), and corporations are certainly aware of girls as a consumer market. However, in trying to create “girl” games in recognition of the disconnect between girls and popular, “boy” videogames, companies pander even more to gender stereotypes that ironically don’t reflect the 3-dimensionality of real girls and women. Marketing games to girls shouldn’t mean making everything gossipy and pink, yet there are countless products in that vein. Games and toys aimed at the female population are often shallow, fluffy screen versions of dress-up and shopping—worlds where friendships and rewarded behavior revolve around looking one’s best for men and spending money. How passive and for-everyone-else’s-benefit is that?

In a past post, Taylan wrote that playing games and playtime in general is “an integral component of development of the individual” where we “learn…skills that are crucial to survival,…[particularly] when the knowledge and information is directly related to winning. Millions of years of evolution has sharpened one trait the most, common in all organisms alive today: competitiveness.”

Games surely involve competition, and competition can be a component of fun and sportsmanship. But with many videogames, we are entrenching a world of values where boys impress each other by being violent, and girls impress boys (and compete with other girls) in being pretty and inviting of sexual encounter. Is this type of play really actually an innocuous way to experience risks out of context? I don’t think that hijacking cars, destroying aliens, and murdering prostitutes are risky behaviors we need to practice for real life applications.

And let’s not doubt the connection between videogames and real life. As Taylan wrote, “Th[e] strong association of playtime with learning of skills that are crucial to survival has shaped our brains into being incredibly receptive to new knowledge and information that we are exposed to within the activity of playing.”

Since game-time is so important to real life, the games I love are those that skip over gender pigeon-holing and cruelty, and give us practice at tasks and behaviors that can make our non-videogame lives enjoyable and rich too.

This index includes some adventure/invention videogames where a player thinks through clues and creatively hurdles obstacles, and of course, the Wii. I was thrilled when the Wii came out because a whole new type of videogame was born, a genre where fun is based on sports, music, and movement, rather than on death and insensitivity to fellow humans. Funny too, how the types of games that don’t involve as much sexism and violence can be more team oriented—winning Wii games often depends on cooperation and collaboration rather than competition and singular gain. (The only example I know of where violent videogames foster teamwork is in the case of internet games, where people can be, say, on the same Airforce squadron, working together to obliterate an enemy.)

What do you think about gender and videogames? Do you have apropos stories? Contentions with or examples of what I wrote about? Games to recommend? Please let us know your thoughts!

Further resources:

Susan Linn, The Case for Make Believe: Saving Play in a Commercialized World

Jean Kilbourne, Can't Buy My Love: How Advertising Changes the Way We Think and Feel

Diane Levin, From Conflict to Peace Building: The Power of Early Childhood Initiatives

Justine Cassell and Henry Jenkins (eds), From Barbie® to Mortal Kombat: Gender and Computer Games

Steven Poole, Trigger Happy: Videogames and the Entertainment Revolution

Reactions to my previous post

2009-09-09T15:22:00.000-07:00

On LinkedIn, there has been some great discussion going on about my last article, and I want to share those comments in addition to the others here on my blog.

Ted Southard CEO at DigitalFlux Entertainment, LLC:

"Interesting, and you raise valid points. However, how do we know that Six Days in Fallujah was not that mature game in an FPS shell? It may well have been, and it was something that was touted as one of it's differentiating features, since I believe it followed the story of an actual squad in that battle.

The actual matter is that it's okay to do Call of Duty 4 or Modern Warfare 2 in these locations because they are not real, and thus do not enter into the realm of politics, which Six Day in Fallujah did. When that firestorm brewed up from both sides of the argument, Konami backed off and folded like a chair at the beach...

What needs to happen, in addition to what you had recommended in more deep games being produced (and you're right in that those are in short supply) is for companies to stand up to their parents as well. I would not have backed off the game, but would have addressed all of the critics with facts and slugged it out.

People appreciate integrity, and the lack of it in some of the dealings in this industry reflect the immaturity you speak of. In this case, Konami showed a lack of integrity in backing off of the project instead of taking their case to the public in a more aggressive manner, which not only would have benefited them, but the entire industry by showing people that we can and will stand up for our medium. Otherwise, we just look like kids with their hand in the cookie jar."

Ernest Adams Game Design & Development Consultant, Freelance Teacher

"Your message is worthy but short on specifics. Yes, the industry needs to grow up. I've been complaining, sometimes bitterly, about that for nearly 20 years. But what does that mean in specific terms?

To me, one thing it means is that when the developers of a game DO choose to tackle difficult and controversial subjects, they must do so with the utmost seriousness. They must not yield to the temptation to include gratuitous shock content, inside humor, or anything else that would justify a criticism that the game is trivializing the subject. (It will receive that criticism anyway, just for being a game; the question is whether the game includes content that, in candor, really DOES trivialize the subject.)

Some will undoubtedly complain that if Quentin Tarantino can trivialize violence and brutality, why can't we? And the answer is that Tarantino works in a medium that has already earned its cultural status -- as you yourself point out.

I don't know enough about Six Days in Fallujah to know whether it treated the war with the gravity that it deserves. I had heard a rumor that it was less a Rambo-style FPS than a survival horror game, because that's what the battle really was: survival horror. If true, I think it would have been an important step forward in our portrayal of war, and I would like to have seen it. But I also know how game developers love to slip in cheats and Easter eggs and other supposedly "clever" material that is fun to find, but subverts the tone and message of the subject matter. And that would immediately destroy the credibility of any game on a subject as grim as the battle for Fallujah.

If Atomic had included even one powerup, or hidden super-weapon, or invincible mode, or Easter egg that changed all the enemies into giant rabbits, then it would have ruined the game -- and been a major setback for anyone else trying to address a controversial subject. Did they? Or did they really take their subject matter as seriously as they should? I guess we'll never know."

Ed Salsberg Owner, Steel Valor Online - Video Game Consulting & Beta Testing:

"We've done WWII to death, raised it and to the death again! When I heard it was canceled due to the controversy of the current war(s) I was majorly disappointed. We need fresher content!

Honoring the fallen by telling their story and even pushing some of the profits to the families of the fallen would change the public's view of this game entirely. The stories on the Military Channel, especially those dealing with current or recent events are the most interesting and very popular.

I really think they should reconsider or pass the project to someone with the balls to do it and do it right. We could use the new content as teh only gold series we currently have that deal with modern day combat are GRAW, CoD and ... ummm ... exactly.

Honestly, if K was concerned about content dealing with current conflicts maybe they should stop selling their Crusades games ... as that was will always be fought until we die or forget the gods."

Jaime Kuroiwa :

"I believe this is the reason for SDF's demise. Shortly after this news broke on the blogs, Konami pulled support. I don't think it was coincidence.
http://kotaku.com/5209552/insurgents-contributed-to-development-of-six-days-in-fallujah

And here is a comment from reddit.com user randomlulz:

"... is the opinion of a jobless MBA grad in his twenties..."

...I must say I am flattered that I can still pass for twenty-something...

Why "Six Days in Fallujah" was really cancelled

2009-09-06T16:39:00.000-07:00

"Bang! Boom, ratata, boom, bang!" she said, while holding an imaginary rifle in her hand and doing her best to impersonate a testosterone driven male gamer, mouth agape and pupils dilated.

The person sitting across from me was my potential future boss, the creative director of a noteworthy agency in BC, interviewing me for a job. This was her reaction to me saying that video gaming was one of my hobbies. It was inspired by her general impression of video games (violence, explosions, guns, etc.), and followed by the question whether I was really into that.

My answer to her question was a protest. It started with a sigh and continued along the lines of "You shouldn't think that way," and "That's not really fair." But as I continued to explain my viewpoint, I was simultaneously realizing that her opinion, while unfair perhaps, was at the same time perfectly reasonable in its origination.

For what reason was there to think otherwise?
Even for those of us who know that there is so much more to video games than B-rated action movie rip-offs, it is no small mental challenge to dig up a glorious example of deep storytelling from our memories, without having to go many years back in time.

There was a time that video games were giving us thrilling glimpses of a new kind of storytelling, rich with emotion, philosophy, experimentation and unparalleled immersion. There was content on par with fine literature. Ironically, that was also the time when gaming was associated only with kids, teenagers, and adults who had horribly failed at getting a life. Gaming was far from being hailed by the incumbent media as a "cultural phenomenon." It was nowhere near being mainstream, and its appeal was deemed childish at best.

And then video games did what all the other media before them had done to gain mainstream popularity: they dumbed the content down. It was in the fashion of a brat screaming and begging for attention: loud, crass, inappropriate, irresponsible, hormone-driven. Gone were long chunks of dialogue from the screen, "because people did not like to read." Gone were thought provoking stories, "because people just wanted to have fun." The content did not mature up, but rather got an "M for mature," meaning it adopted a behaviour pattern rife with sex, violence, nudity and coarse language, just like a rebellious teenager imitating his/her impression of what an adult is. And it worked like a charm!

Today, video games are not simply a childish waste of time, produced entirely by isolated programmers here and there, doing some coding while they are slacking off on their full-time jobs. It is a big, serious industry, employing many professionals from a wide variety of digital fields, and serving a global market worth billions. The content strategy has served the industry well indeed. Or so it seems, if you ignore what is starting to happen now.

What got you here won't get you there
It was back in April, Konami announced that they were dropping the controversial game Six Days in Fallujah even before it could see the daylight, due to an overwhelming outcry against the game's premise. The premise was a digital reenactment of one of the key battles of the Iraqi War, in the style of a First Person Shooter. It was criticised by both Pro-War and Anti-War commentators. Some blamed the game for trivializing war, while others said it was glorifying war. While these points might seem contradictory to a non-gamer, it should sadly be noted that war games (to date) have an uncanny knack for pulling off both offenses at the same time.

Yet there is something in this story that does not make sense at first glance. After all, this was not the first attempt to portray the Iraqi war. There are already many movies made about almost any war in recent and far history - most of them featuring Americans fighting in somebody else's country. Why such a strong reaction to a game when seemingly anyone can make a movie about anything related to war?

Add to this puzzle the fact that there are games such as Modern Warfare, Battlefield series, and many more, taking place within the context of imaginary conflicts that are blatantly obvious anagrams of real world conflicts, and yet faring merrily in sales figures with nary a protest, nor an objection. So what's going on here?

The answer is simple. When it comes to handling sensitive subjects of the real world with due care, video games just have zero - none, null, nada, squat - vote of confidence from their audience. The situation is exactly that of the previously described rebellious teenager who, upon asking if he/she could take the keys to the family car to go to a late night party, is given the answer: "Yeah, right. Like that's gonna happen in a million years."

Six Days in Fallujah is not the only manifestation of this. It is a similar thing that happened to the game Super Columbine Massacre RPG at the Slamdance festival of 2006. A different kind of reaction stemming from the same sentiments came for the last Resident Evil game, blaming the developers for being insensitive about racism.

Movies do not suffer from the same bias because that medium has long proven itself capable of "adult responsibility" with many fine examples of film making. They have deserved and earned the benefit of doubt that saves them from being cancelled even before being filmed.

While the braindead marketing philosophy of the last century might think of these controversies as "great publicity for games," (Dante's Inferno, you hear this?) the truth is that there is no more ground left to be won by such tactics. In fact these very tactics are becoming a hindrance for video games in their rise to the dominant medium of the future throne. Especially at a time when the whole global business community is engulfed in change towards more social responsibility, this particular industry runs the risk of drawing more and more ire from gamers and non-gamers alike, for its glaring indifference and reluctance to grow up.

It is now time that the teenager should get a clean haircut, learn to self-administer mouthwash, and start wearing something that doesn't have skulls and pentagrams on it. Such a thing is far from being unimaginable. It used to be, in fact, a reality.

The humour in the Secret of the Monkey Island was comparable to Terry Pratchett. The haunting riddle of Planescape: Torment was no less profound than any quote from Nietzche. The noir style of Grim Fandango could make Tim Burton jealous. The video games industry used to be that responsible person (and still immensely fun) a long time ago. And it can become that person again.

But how, you ask, will video games prove themselves worthy if they are not even given a chance? My answer is: learn to mow the lawn first before you ask for the car keys. Work your way up from less sensitive subjects and show the world you are ready to take the responsibility of being the dominant medium.

As a good example to that, I recommend looking at how Battlestar Galactica series handled the topic of terrorism, war, and even suicide bombings admirably, without offending its audience. There are lots of similar examples out there, if one wants to find them.

(Note to journalists and researchers: Next time, before you publish an article about storytelling in video games, please do take time to study the matter in depth. When you ignore all those fine examples of storytelling as if video games started off with Grand Theft Auto, you end up misleading your audience and hurting the credibility of your authority in the subject field.)

(Note to my interviewer: No offense meant to you at all! It's still okay to hire me!)

P.S. I have copied the comments from game-devs about my article in a new post, which you can find here. Or you can join the Game Developers group on LinkedIn to see them there.

Does innovation really sell?

2009-08-26T15:12:00.000-07:00

The word innovation is almost universally revered these days. We organize conferences, seminars, and workshops, we write books, case studies, and even poems about it. Businesses are built around the idea of innovating constantly, or at least so claim the marketing messages. Despite such great enthusiasm, however, we collectively seem to have a knack for ignoring innovation when we are staring squarely at its face.

A chapter of the book "Chaos: Making New Science" is devoted to the nature of scientific revolutions. Quoting Thomas S. Kuhn, a historian of science, the author retells a psychological experiment conducted in the 1940s. In this experiment subjects were given brief glimpses of playing cards and asked to name them. What they were not told was that there were trick cards in the deck, like a red six of spades or a black queen of diamonds.

At high speeds, the subjects identified the cards successfully, without perceiving any anomalies. But when the speed was reduced, and they had more time to look at the card, they began to hesitate. The brain had perceived some irregularity but was unable to name it. When the speed was further slowed down, the subjects started to catch on and make corrections.

Interestingly, though, not all of them. A portion of the subjects reported painful disorientation.
"I can't make that suit out, whatever it is. It didn't even look like a card that time. I don't know what color it is now or whether it's a spade or a heart. I'm not even sure what a spade looks like. My God!"

Kuhn argues that professional scientists are no less likely to suffer from similar disorientation when confronted with a situation that is identified by the current paradigm as an "incongruity." Indeed, one does not need to be a historian of science to recall examples of revolutionary scientists facing harsh resistance, and even hostility from their peers, for having dared to challenge the status quo of scientific progress.

Reading this, I realized that innovation faces the same challenges even outside the realm of cutting edge science. The example I immediately can recall is that of OnLive, or gaming with Cloud Computing in general. Since the first announcement of the concept, there has been quite a significant reaction to it, generally erring on the negative side. Many people have shared their opinions on why such a service is not even technically possible, while some others have argued the financial unfeasibility of the endeavour. Industry people have called it "the end of the golden age" for gaming, and even gamers have been uttering the name in contempt.

In marketing, the risk of rejection is sometimes expressed in terms of consumer behaviour. If a product or service requires "significant change in consumer behaviour," as innovation often does, it carries a high risk for rejection. In my technology entrepreneurship classes, the strategy that was most frequently cited was that of "Crossing the Chasm," to overcome that challenge.

It is interesting to observe a similar strategy from scientists who have been trying to let the world know of their revolutionary findings. Stories are abundant, of scientists "dumbing down" their own papers to get them published, or changing the style to make them appeal to their peers, or even choosing obscure journals to publish on, out of desperation. In other terms, disruptive innovation has a way of sneaking in through the back door, like a sketchy, shameful acquaintance that we do not want to be publicly associated with.

This makes me wonder about the wisdom of mass-marketing anything as a "truly revolutionary product" when there is actually truth to the claim. Thinking about the OnLive example again, it seems to me that the buzz has focused too much about the technology, and too little about the value that the consumers will derive, the latter almost dangerously assumed to be self-evident.

The same could be said about Project Natal from Microsoft. The applicability of the technology to consumer experience is still vague at best, outside a narrow range of genres and styles displayed in the E3 presentation.

The dead end on innovation street has a sign pointing to it; "Admiration of novelty for its own sake," it reads, and is very tempting to the innovator him/herself for the pride in having put it together. What we see, though, is that relevance is the key (to the backdoor even as it might be) to gain acceptance. Beautiful as they may be, the guts of your innovation do not necessarily matter much to your audience if they cannot discern how all of that relates to themselves. Even among the brilliant minds of the scientific community, it seems difficult to get people to read anything if they cannot see what the knowledge helps them to understand.

On the other hand a more personal lesson to be derived, whether you are a consumer, investor or entrepreneur, is to keep an open mind and not let great opportunities slip by blindly favouring probability over possibility. When innovation becomes the master of the house, it will reward those that let it in through the front door.

To end the post with a positive note:

If it really sounds too good to be true, it possibly is... true.

The Secret of Marketing with Games Explained with Motivational Forces and Neuroplasticity

2009-08-05T12:28:00.000-07:00

In order to understand how marketing with games can be effective, it is very important to understand why people play games -and not just video games- in the first place.

Let's start with a little quiz. Can you tell what the following strings of characters symbolize?

AK47 - MP5 - M1A1 - M16 - UMP (I'll stop here before my blog shows up on national security queries)

If you are a gamer, chances are very good that you will correctly answer the question: they are all firearms. If you have played enough First Person Shooter games (like I have), you can go even further and tell me an amazing amount of detail about each weapon: ammo type, effective range, handling, accuracy, where and when to use each, and more.

I am a peaceful, anti-war individual who has never even touched a firearm in his entire life, let alone fire one. I advocate a gun-free society and do not plan to own any sort of gun any time at all. In short, I am nowhere near being in the market for guns. Yet why does my brain retain such intimate knowledge of the products in question?

Let's look at a less inflammatory example: I have never been in the market for a Ferrari, Porsche, Lamborghini or some other similar car either. Yet there was a time I could almost write up a factsheet about each one from memory. Why did I care?

While you think about that, let me turn back to the original question of why people play games. Playing and playtime are not limited to just humans. Many mammals, particularly those of the predatory kind, make use of games and playtime as an integral component of development of the individual. At its core, playtime is an opportunity for the mind to learn about risky situations, and to master the skills of dealing with them, without taking any actual risk of getting seriously hurt or wounded. This strong association of playtime with learning of skills that are crucial to survival, has shaped our brains into being incredibly receptive to new knowledge and information that we are exposed to within the activity of playing.

It is even more so when the knowledge and information is directly related to winning. Millions of years of evolution has sharpened one trait the most, common in all organisms alive today: competitiveness. Often times there has not been enough room on this planet for everyone. When that is the case, the one that survives is the one that wins over the competition. This is why the need to win (whether as an individual or as a group) is the mother of all motivational systems that our brains rely on. Any skill, knowledge or information linked to that primary motivation is sure to get the utmost focus of our perception and cognition. Playtime, particularly the structured sort, takes advantage of this fact by offering rewards to be won, and defining the set of rules, skills and knowledge to be used in reaching that goal. If the reward is enticing enough, the brain puts a flashing neon MUST-LEARN tag on all relevant information. Let us call this The Relevancy Factor.

A most beautiful advantage of playtime is that it allows for practice of skills and use of knowledge out-of-context. A cat does not need to wait for mice to show up, to hone her skills. In other words, you can simulate a particular experience as many times as you want, without having to rely on external conditions. Neuroplasticity studies have recently shown us that it is a highly competitive environment inside our brains, where the skills and knowledge that we do not frequently use tend to wane, and the ones we frequently use grow to occupy larger space. It is known as the use-it-or-lose-it principle. In this way, playtime allows for much more frequent use of skills and knowledge. Each round of playing reinforces the importance of the subject in question. After enough rounds played, the brain now puts a flashing MUST-RETAIN sign on all relevant information. Let us name this The Stickiness Factor.

Now we have the context for transitioning from Reach x Frequency, to a measure that is more appropriate to marketing with games; Relevance x Stickiness.

Reach vs Relevance
John Nelson Wanamaker, the father of modern advertising as they say, is often quoted in saying: "I know half of my advertising is wasted. I just don't know which half." Over time it has become one of the main struggles of marketing to reduce that ineffective half to smaller percentages by careful media buying, segmentation, geo-targeting, etc. Yet still when one airs an ad on any media, they are still paying for the eyeballs of a good number of people who are not even remotely in the market for the advertised product.

The limitation is that people pay attention to only what they deem is relevant to their lives. I am sure I will purchase a car in the next five years, but I have no pressing need right now to pay close attention to auto commercials. I may think about buying a house in the next ten years, but for all those real estate ads on the newspaper I am quite out of reach right now. And yet they pay for my eyeballs nonetheless.

But what if, as a marketer, you did not need to catch people at that perfect time in their lives to get their attention? What if you could seed the information now and reap the purchase interest later?

This is one advantage of marketing with games: you can make the information relevant by presenting it within an appropriate motivational context. I may not care for a muscle car, but if I am playing a racing game, I need to learn which one is the best, which one can turn the tightest corners, etc, because I want to win. Once the relevancy is established, the message is not going to waste anymore.

Compared to mass media advertising, your marketing does not need to be divided into Effective and Waste portions. Instead of that, it creates Effective and Collateral segments, the latter of which has a higher chance of triggering interest (compared to Waste) at later stages of the consumer's life.

Since relevancy means superior engagement of the consumer, we can also use the term Engagement Factor.

Frequency vs Stickiness
Frequency relies on mere repetition to cement the information in the minds of the audience. It is a passive method of "learning," requires constant upkeep, gives diminishing returns, and is also hard to manage. In short, it is grossly inefficient.

Stickiness, on the other hand, relies on the use-it-or-lose-it principle of neuroplasticity. When marketing with games, it occurs from constant self-exposure of the consumer to the marketing message while having fun. The fun factor engages the individual and keeps them coming back for more, allowing for many more instances of direct experience where they can actively use the information. When the use of information is directly relevant to the structure of the game, this allows for the brain to retain high volumes of information with an unusual level of detail about the product that is marketed. This is also how people learn more about European history, from games like Europa Universalis, than they do in many years of history classes in school. Compared to mere repetition, this retained knowledge also lasts much longer in the brain before it starts to wane due to lack of use.

A hybrid: Reach x Engagement x Stickiness
In order to have a succesful marketing campaign with games, you need three components:

The game must get in the hands of the audience. If it's a commercial game, it needs to sell. You can distribute it for free to get the highest degree of reach.
It needs to engage the user with your message. Your message needs to be relevant to the game at its core. Absorbing the information should be as closely tied to the game goals as possible.
The game needs to be fun. This might make you say "Duh!" but it is surprising how even some commercial games miss that simple target. If it's not fun enough to keep the user coming back for more, it will hurt the duration of exposure to the message. The brain will not retain the information.

Hopefully this article will help people to start thinking beyond getting the eyeballs with in-game advertising, and start using the games medium in a fashion more suited to its true competency: engagement and interactivity.

It is also easy to see through such thinking, that people who have a deep understanding of both worlds (marketing and digital entertainment) will be in high demand in the future, as the video games sector continues on its path to becoming the dominant media.

If you are interested in learning more about neuroplasticity, I highly recommend reading The Brain That Changes Itself.

I should also note, the Engagement x Stickiness may also be worth thinking about if you are in education.

As always, for questions and comments, please feel free to use the comments section here, or email me at taykad-at-hotmail-dot-com.

(Addendum: JP Sherman has written a nice expansion to this post, applying the same principles to video game marketing itself. Check it out.)

What to learn from Battlefield 1943

2009-07-23T12:08:00.000-07:00

In case you haven't been following the performance of Battlefield 1943 from DICE (published by EA), the download-only game seems to have been a huge success in terms of sales.

It is very rare that I applaud EA on this blog for anything, but this time they've done good. I've told numerous times in my writings that a game does not need to follow the "all bells and whistles for $60+" approach in order to be commercially successful. Kudos to DICE for figuring out all the value added components of their game that matter to their customers, and stripping everything else away, including retail units. The result is a no-frills game for $15, which happens to sell faster than hot cakes.

Strangely, being sold on Live Arcade at that price point makes it a quite frill-full game. Instead of a lackluster game trying to compete with the likes of Call of Duty (much like BF: Bad Company tried to do at the regular price point), being a great game for the $15 price point is a much better differentiation strategy.

The question is, though; can it be repeated? It is important to understand that such low price might not have been possible if the developers had to design the maps from scratch, or if they had to develop the Frostbite engine for the first time, or if they didn't have a pretty familiar set of game mechanics refined many times in the previous iterations of their franchise. Speaking of the franchise, it is also worth considering what the outcome would be if they did not have the Battlefield brand behind the game. Would it still perform well? Would the brand name of DICE be enough?

All in all, I am pleased to see EA trying different approaches for a game's value offering, and I'm hoping their success with this title will encourage them to experiment more and perhaps answer some of the questions above in doing so.

How to Sell a Better World

2009-06-16T01:50:00.001-07:00

For once, this has nothing to do with gaming. Thanks to Communicopia for inspiring me to write this post, in their rather unique way.

In previous posts, recent and old, I argued that the future of marketing and business in general will be about giving a better world to the customer. With the philosophy change from Push Marketing to Pull Marketing, it is inevitable that we will find ourselves thinking more and more at the individual customer level, studying their needs and desires.

Such deep drilling may eventually cause every business out there to converge at the market of meeting the most common needs of everyone on the planet: a world with more social responsibility, more environmental conscience, more transparent institutions, more human rights, more accountability, more justice and freedom, better education, healthier children, happier people - a better world, for short. That has been the focal point of my arguments before.

This time I am going to elaborate on why this did not happen before, why we need it, and why businesses should care.

A Better World for Everyone
This approach simply does not work, and I will argue that it might very well be the root of many evils we face today on this planet. In the old days, businesses rarely attempted to provide a better world for everyone. The reasons of this are not hard to understand.

People have always had a hard time agreeing on a vision of what makes for a better anything. For the purposes of market segmentation, it was nigh impossible to find a better world vision that appealed to a large enough customer base.
Especially when customers did not have the means to express that vision. In a world without social networking, social media, tweets of fame, and bestseller blogs of the ordinary people, it was the will of the collective that ruled over the individuality of persons.
Collectives of any kind have the tendency of diluting human values as they grow bigger: the size of the group is inversely related to centralization of responsibility and accountability, while directly proportional to the power it commands. In other words, the bigger the collective, the more power it has, and the more distributed and diluted the responsibility. This means the definition of a better world is often dramatically different at individual and collective levels: i.e. you may be against torture, but your government will do it anyhow.
Governments are the best case for this. I am not going to argue over the virtues of democracy and representation. I will merely make a factual statement that they do not always seem to work as intended. The latest financial crisis, or the state of the health care system in the US are just a couple examples. Even in healthy functioning democracies (where lobbying is not just another word for legalized bribe) the spirit of politics is compromise; which means a slightly better world for some, and a slightly worse one for some others alternatingly. From a business perspective, it means unsatisfied customers are a part of the business model by design.
Governments also seemed to have a perfect monopoly for the market of "providing a better world for everyone". After all, this has been their purpose of existence all along. So as a business owner you thought: "I don't know what a better world for my customers mean. I don't know how to ask about it. I don't know how to provide it. Even if I did, isn't that what the government is for?"
Except governments are locked to the mentality of "providing a better world for everyone on this side of the fence only." Whereas the biggest problems plaguing the humankind today are of a global nature. Governments are limited by their localized approach to meet the need for a better world. The European Union is the best effort to date, of governments to overcome this limitation. Even then, it is a very slow moving effort when you realize how far away we are from the final version: a global government that can address global problems effectively. Multi-national corporations have a much better market positioning in that regard to serve the customers in need of a better world. This might be the final mantle to be assumed by the corporation, the dominant institution of our day, in order to truly ascend to the throne.

But if you cannot provide that mythical better world for everyone, does that mean all hope is lost?

Far from it.

A Better World for You
Forget about everyone. All our problems have stemmed from trying to please the collective at the expense of the individual. This is why there always has been someone wronged, someone hurt, someone disenfranchised, someone unhappy. While unsatisfied customers may be acceptable for government monopolies, a private sector enterprise cannot afford that. What, then, the entrepreneur needs to do is to start from the individual level and work their way up.

By focusing on the individual's definition of a better world, the need for compromise is largely reduced. Technology - particularly the internet - makes it possible to drill down to the level of the individual in order to extract that definition. Two issues need to be addressed at this point: how to create and deliver the actual value, and what incentive there is at all for doing all this. I will start with the latter.

The incentive is that because advertising is broken, and showmanship is no longer enough to engage people. A dialogue is what brands need to engage customers, and there is no dialogue if you do not have anything meaningful to say. The elephant in the room is the brands' thinly veiled apathy to the human condition that their customers so keenly feel in their lives. It is no longer enough to say that you care. Now, people demand that you prove it.

Another incentive is that it actually sells. I have tried explaining above what an underserved market that is, the market for a better world, for various reasons. Tapping into that market has proved to be profitable for many brands in different industries.

And finally: how to create and deliver the value.

You cannot make everything right for every single individual. That is the same as a better world for everyone, which obviously does not work.
What you can do, however, is to empower the individual, so they may create their own better worlds. The rise of the individual's power has been observed and mentioned many times as one of the main trends of our time. You do not want to be at the wrong side of that trend.
Do not try to just spoonfeed a better world, allow people to collaborate with your brand. As I said in my previous post, coffee brands helping farmer communities is no longer enough. It is time they let their customers help directly. Apply the same idea to your own industry and your own CSR/marketing initiatives.
Reward your customers for doing the right thing. Reduce the barriers, give incentives, make it easier for them to do the right thing.
Enough with the Swiss approach. Drop the apathy. Take a side. Be a brand that openly supports gay marriage. Be a brand that speaks against capital punishment. Lobby for the interests of your customers, not just your own. Why not segment your market based on political views? Why not build a brand image around doing the right thing, championing the right values?
Think global. Taking ownership of global problems is not a burden, it is an opportunity. In fact, grab them while you can! Differentiate yourself with how you make the world a better place.

In this way, it may be possible for brands to escape the downward spiral of traditional advertising, and to have messages that are fundamentally relevant to their customers.

This is my vision for a better world, and I am very interested in hearing what you think of it. Please share your comments here, or email me at "taykad-at-hotmail-dot-com"

Ethics in viral marketing

2009-06-08T12:51:00.000-07:00

It really bothers me when news like this shows us that people still don't quite understand what viral marketing is and what it is not. One might say a publicity stunt is not viral marketing. That argument, however, would not have been helped by the fact that it was a viral marketing agency staging all this and that they got media outlets reporting on it as real news.

Seth Godin defines viral marketing as "... an idea that spreads--and an idea that while it is spreading actually helps market your business or cause."

When you employ a bunch of fake religious protesters to create buzz for your game, like EA had done to promote Dante's Inferno, the only idea you are spreading is that you are not above fabricating a false reality and presenting it as the real deal in order to get attention, very much like a spoilt, immature brat would. It says very little about your game, offers no real value to the gamer, and speaks volumes about what you think of marketing ethics and how much you (don't) respect your customers.

Should also note: admitting that you have pulled a publicity stunt, days after the fact, does not make it all fine and acceptable. Admitting to a lie without any apology only tells us that we probably should expect this behaviour from you again in the future.

If you are reading these lines, I hope you will mark this post as an example on How Not To Do Viral Marketing / How Not To Create Buzz.

A publisher is to a developer, as a developer is to a..... ?

2009-05-21T18:21:00.000-07:00

The answer is "designer." In other words, a recent revelation has shown me that developer studios are not much different in terms of business philosophy, than the publishers that they are so fond of (privately) criticizing.

The revelation came when I was pitching my idea of designer branding to the head of a prominent studio. I was trying to explain that the most original, innovative ideas in gaming tended to come from designers with their own brand names, and that such individual brands could help studios drive ideas through the publisher resistance. And in response, it was explained to me why this idea would not work.

The reasoning was that most studios would be hard pressed to retain their then-famous game designers, whereas publishers could easily write pretty alluring cheques to steal such emerging talents from the developers' hands. At first glance this sounds pretty reasonable. When you rearrange the main argument a bit, though, you find the true meaning:

We do not want to reward our designers with the fame they deserve, lest they use that against us to demand more and more.

Which ironically happens to be the same business philosophy of publishers to keep developers in check. Needless to say, there are ways of preventing that supposedly-inevitable outcome of losing designers: equity-sharing is the easiest one that comes to mind. But of course, why give that away when you can keep the lion share to yourself? Is it not the point of running your own business to have people working for you?

Maybe it is not.

Maybe it is a better idea to have people working with you, while they work for themselves at the same time.

Maybe risk sharing is exactly what your creatives need to mature up.

Maybe you should consider not running your video game business the same way your grandfather ran his paper mill.

Maybe the escape from commoditization starts right inside your head, with the way you think about your own employees.

Maybe it is not about what you pay people, but about what you share with them.

The future of gaming innovation is with those who can bring together creative ambitions and business responsibility. As long as you keep the two apart, you will remain a follower.

Told you so

2009-04-29T23:21:00.000-07:00

"No place for traditional publishers in digital market," says David Lau-Kee. In his speech about the future of video game publishing, he had apparently touched on several roles of the publishers in the value chain that are becoming increasingly less relevant.

Kinda reminds me of my own post saying exactly the same thing four months ago, which failed to gather the same amount of intellectual praise and consensus; something I blame on the lack of a VP title to my name.

So you see, it's a good idea to stay tuned to me. You get to hear stuff months in advance and with no admission fee!

Future of marketing and advertising... is gaming?

2009-04-28T01:31:00.000-07:00

I have exposed myself to a number of new ideas (and reminders of old ones) over the last week, all about the present and future of marketing and advertising; and they are beginning to converge nicely.

Seth Godin says people are interested in what you do, and not what you say. It is true at a personal level, and it also applies to brands. We are all so cynical about what brands have to say, because we have heard it all. Our stance manifests itself in the fall of the power of mass media advertising. It is expressed when we change the channel or go to the bathroom instead of listening to big bugdet, flashy, celebrity featuring 30 second spot ads. Even if we choose to stay and listen, it is doubtful we have not heard it all before.

They say that in order to engage people, you have to tell them something that they are genuinely interested in. Your message needs to be meaningful, useful even, to the consumer. So I thought about what makes me listen to a branded message as a consumer. For me, it has to fit in one of the following criteria:

Must be entertaining: I can laugh at your little joke but that doesn't make me believe you enough to listen to the rest of your pitch. It is much better if the message is part of my ongoing entertainment experience; like, say, gaming perhaps! It is best if the entertainment value of the experience makes me want to interact with your brand more.
Must be educational: Are you just trying to take advantage of the fact that I don't know any better, or are you actually making an effort to give me the knowledge that can make me tell the good from the bad? If you want to educate me, I will trust you more. If your brand of 'good' is not rock solid, chances are you won't try to engage me in this way.
Must be part of the solution to a real problem: Do you care about the things I care for? If so, are you just saying that or are you able to prove it? Even better, can you allow me to participate and contribute in meaningful ways? Coffee companies love telling us about the communities they help in third world countries. But how many of them actually fly their customers there as volunteers to actively participate in such help?
Must be saying something I haven't heard before: Also known as innovation. Diamond shreddies, as much as I love the creative idea, don't really count.

So I reach two main conclusions:

I.
The future evolution of marketing will favour those brands that do deliver on real values of honesty, compassion, responsibility, accountability, transparency, sustainability and all other virtues that were perhaps once deemed too altruistic for the marketing field. We will only want to listen to those that make genuine efforts at giving the consumers a better world in one way or another. We care about what you do, you better be doing something good, and it better be real.

II.
Allow me to share this section of Dominic Basulto's blog post involving a quote from Ajaz Ahmed, the chairman and co-founder of independent digital marketing agency AKQA:

"The (advertising) agency of the future will be half a software company and half an entertainment company because that's the new landscape."

This was said in the context of "...how companies are now working with a broader mix of agencies and technology companies than ever before as they craft new marketing campaigns designed for the online space."

Half software, half entertainment you say... hmm... Does that sound like anyone you know, dear game devs?

OnLive will kick your ass! No, seriously

2009-04-11T14:34:00.000-07:00

Will OnLive kill the console market? Will they put everyone out of business? Will they beat up your dad? Your mom?

As you can probably tell from the prelude, this is going to be about the recently announced gaming platform OnLive and its fortunes. Since reading about it for the first time, I have lost count of the blog posts explaining to me and everyone else why OnLive will fail, crash, burn, cry in the rain, and possibly regret ever being born in the first place.

Let me say it right here that I do not necessarily disagree with those views. Which is also to say I do not necessarily agree. Here instead I would like to play the devil's advocate for this hopeful enterprise, not out of conviction for its birthright but simply to poke some holes in the most common arguments against it.

One reason why OnLive will never beat up your mom
Because that's not the point. Same with that "death of a console" fiction that everyone (including me, obviously) is eagerly writing about. They may not be the console killer but does that necessarily make them less significant? Is the internet somewhat less of a revolution because it failed to kill the print media?

Technology won't be ready for mass market until 2012
Oh no! But nobody will be alive in 2012! *

Let me do the math for you: 2012 - 2009 = 3 (years)

Three years is a very reasonable time frame for any tech start-up to see positive cash flows and profitability. We are not talking about the next century here. If no amazing success story about OnLive comes up in that period, that does not mean they are failing.

Also feel free to compare three years to the development cycle for a AAA title. Don't worry, your grandchildren will see it even if you don't make it yourself.

*Might be the case if that December 12th 2012 myth is not a myth after all.

People prefer having a tangible product (discs?) in their hands
Ah, yes. The collectors. Can't win the market without winning the collectors. Allow me to set up an appointment for you with the game rentals business people, so they may laugh at your face. Haha.

OnLive would disrupt all my other internet activities
Have you tried playing Call of Duty on Xbox Live when your roomie or SO is downloading a movie on the home computer at 600 KB/s? Let me tell you, you hit the ground first and then see the guy who shot at you. This is not a problem that would be unique to OnLive. We have always had it.

Nathan Solomon on LinkedIn says this is different than the latency issue on XBL. If someone else is downloading something, I would not be able to use OnLive at all. True that. But in both cases I (personally) would be killing the download before resuming my gaming experience. End result is the same. If there are people who like torturing themselves by playing a FPS game with heavy downloads in the background, then yes, OnLive would not suit that particular lifestyle choice.

Frame rate per second issues
As I said in a similar discussion on LinkedIn, the critics have the habit of picturing the video game market in their own image. Not every gamer is a FPS fanatic who measures the value of a platform by its appreciation of fast reflexes. There are games out there the players of which might not pull their hair out if they miss a couple seconds in a streaming video.

Retailers will not like it
Shall I arrange a second appointment with the game rental folks? Or would you prefer someone from iTunes this time?

Microsoft/Sony/Nintendo would not allow it
The strength of a reaction from the console manufacturers, I think, would be directly proportional to the chances of OnLive's success. If they take this newcomer seriously it means there is substance to the enterprise.

Gamers won't put up with "Servers offline due to maintenance"
True. That's exactly why World of Warcraft flopped after people had to stop playing for hours at a time every once in a while. Not to mention the waiting times to join the servers. Man, WoW would have been such a great game if not for that issue. Rest in peace.

Core gamers will not go for it
There is this common misconception again, thinking that core gamers and casual gamers are static, mutually exclusive camps. Such thinking ignores the people who have been pushed out of the core PC game market simply because they cannot afford to keep up with it.

I own a 3 year old pc laptop that has trouble running even the modest indie titles, let alone AAA powerhouses. A decent gaming PC would cost me 1500 bucks, and last maybe another year until it becomes outdated again. For people like me, OnLive offers an attractive value proposition: cheaper entertainment. Even if that means latency and issues, it can still be an acceptable trade-off, given the cost I would be avoiding by not buying a new PC.

There will be no next-gen graphics...
And thus, no problem to solve for OnLive. Or so they say. As much as I would love to believe that the focus will shift from technical superiority to interface and gameplay, I think that is a somewhat naive thing to say. Making games look better goes beyond turning HD into Super HD - whatever that is. It is not just the screen resolution, it is the scope of action, the physics engine, the loading times, and making peace between gaming and genuine multitasking on your PC (a 'pause game' feature would be handy to that end, OnLive).

Want more problems solved? How about not having to add support for every piece of hardware out there and not having tons of problems still with this driver or that? How about trading that for developing for a standardized hardware configuration? How about playing glitchless, bug free games that can hit the market sooner and for less cost?

Summing it up
As I said in the beginning, I am not claiming an absolute destiny for OnLive. Despite the humour poked at the common arguments listed above, there is still truth in some of them. Yet I am not fully capable of understanding the fervour with which the bloggers of the industry herald it as the stupidest thing ever, and regard it with an attitude that might deserve being called "animosity." That is why I felt the need to write up a critique of the ciritics.

So give OnLive a break. It will be fun to watch what happens, even if there is no other benefit to be had. It is not your money they are spending after all.

Why game devs should rethink marketing: The need for B2C branding within B2B

2009-04-09T22:14:00.000-07:00

Now that it has been a while since my last branding related post, it is about time to put it all into perspective and think about what this means for a developer. To do that, I ask the question:

Is it possible that developers have been delegating/neglecting their marketing function a bit too much and unnecessarily, to the point of losing control over the value generated?

A while ago I had the chance to listen to an interesting presentation given by Greg Speakman, the VP Marketing of Sierra Wireless. Part of the presentation was about the difficulties of marketing something that is essentially a consumer electronic product through a B2B channel. Since they did not have the marketing budget to reach the consumer, their lifeline was their business partners like AT&T, who included Sierra Wireless products in heir own offerings. Thus, they were focused on marketing to such partners. I remember him saying how he wished they could make the consumer demand a Sierra Wireless product specifically. If their brand name was strong enough to influence a purchase, then they would have significantly more bargaining power in their deals with business partners.

Their situation has a striking similarity to the relationship between game developers and publishers. A video game is essentially produced for the consumption of individuals. Yet a developer does not sell the game to the consumer directly. They sell to the publisher. In this relationship, the publisher is the heavily dominant party because:

they have the money
they lay claim to the IP
they take most of the revenues
they put their own brand equity before the developer's

The developers lack bargaining chips, because most of the time they do not have the brand power to influence a purchase. There are exceptions of course, as discussed in my previous posts. The usual remark about examples like Will Wright or Bioware, though, is that "they have their own brand equity because they were successful in the first place." But let us turn that on its head and think: "maybe they are successful because they have their own brand equity." It is a chicken and egg argument, I know. But even realizing that means you are aware that this thing has more than one direction at a time.

At the end of that presentation from Greg Speakman, I had to ask him whether they had ever considered low cost B2C marketing campaigns through e-marketing. I was pretty surprised when he admitted that no, it had never crossed their minds.

It was surprising because that was a notable company in the high-tech communications business, yet they had completely forgotten about a powerful communication channel like the internet. It is the same surprise I have, when companies on the cutting edge of new media and content creation tend to underestimate their own reach to the consumers, and blissfully hand over their marketing functions to other parties.

"Oh no, we don't do marketing," says the game developer happily. "Let the publisher spend money for that, we can't be bothered with marketing on top of everything else."

I suspect the publishers are even happier for the fact.

Branding in Video Games Compilation

2009-03-26T15:15:00.000-07:00

This is to compile links to all the posts I have been making on video game branding over the last couple weeks, for easy browsing.

1. Building Brand Equity for Your Game
Discusses the brand potential of a video game title, franchise branding and ways of building up pre-franchise brand equity.

2. Escape from Death Spiral of Franchise Branding in Video Games
Advantages and dangers of common franchise branding practice in the industry. Also introduces and explains the concept of Experience Franchising as an alternative to genre-focused franchises.

3. More on Franchise Branding
Summarizes the comments I have received on my previous post and expands the discussion around them.

4. Other Branding Methods in Video Games

4.1 Designer Branding
Examples and advantages of designer branding, why it is a good thing and why we do not see much of it.

4.2 Developer Branding
Explains the lack of developer branding as a result of the fundamental problems of the industry business model.

4.3 Publisher Branding
Explains why it works for some and why it does not for others, taking other branding methods into perspective. Gives examples to best practice and... not very best practice.

Publisher branding in video games (branding alternatives - part 3 of 3)

2009-03-24T17:05:00.000-07:00

(Part 1 - Designer branding can be found here. For Part 2 - Developer branding, click here)

3. Publisher Branding
For the last and (for once) the least, publisher branding is another strategy one could take, as an alternative to the dominant franchise branding practice in video games industry. The idea is that a powerful enough publisher brand could come to be associated with high quality, highly entertaining games, so that the games themselves would not have to rely on past iterations of their own to get the idea across. I can almost see people snickering and going "Yeah, right" in response to that and I have to admit my own reaction is the same.

If you look at the industry today, you see that the idea behind the strategy falls apart as a result of the publishers' almost complete abandonment of the previous two alternatives. This abandonment translates into:

Squandering of designer brand value
Strip-mining of developer talent
Over-reliance on franchise names as a direct result of the first two, which creates a positive feedback loop
Low-quality, repetitive games being associated with the publisher brand
Publisher brand value going down the drain

Add to that the wide variety of games being offered by the major publishers, which dilutes the usefulness of the brand name for communication with the consumer, not to mention the lack of a clearly differentiated market positioning: you end up with the publisher brand meaning squat next to the franchise brand.

Examples to best practice
There are a couple exceptions to the brutal cycle above. Paradox Interactive is one publisher that does have a clearly understood brand essence, as one can easily see from the titles under its banner. If you have played more than one of their titles, though, you would realize most of them are variations of their flagship title Europa Universalis. But since the publisher has filled its niche so well, and have met the expectations of its customers so admirably, they do not have to rely on the Europa Universalis name alone for marketing. The name Paradox Interactive is enough to compel consumers to buy a game they had never heard of before. In some cases the end result may be a disappointment for the consumer, but it does not negate the fact that publisher branding had worked successfully up until that point.

The second exception would be Nintendo. The advantage they have is a headstart of a few decades, building up a consistent brand image where Nintendo = Fun, simple as that. But perhaps it would be wiser to classify Nintendo not under publisher branding, but rather under Experience Franchising.

I say experience franchising because their brand goes far beyond being about the games. It is powerfully integrated with the hardware behind it, strongly associated with the innovative dedication to entertainment. It commands respect and has earned trust due to unequaled consistency in its market positioning. Therefore a consumer does not simply buy a Mario game or a Zelda game to play on their Wii. They buy a Nintendo experience, an experience that was just as relevant in my childhood as it is today, and as it will probably be in the future. So it is no surprise that Nintendo happens to be doing much better these days in terms of growth, compared to their acquisition-fueled publisher competitors.

Can you speak of a positive EA experience that will be relevant ten years later? An Activision experience? Can you find two people who can agree on what their brand essences are and how they are differentiated?

Developer branding in video games (branding alternatives - part 2 of 3)

2009-03-23T10:43:00.000-07:00

(Part 1 - designer branding - can be found here)

2. Developer Branding
There are not many good examples of developer branding, unfortunately, which is not difficult to understand why. As I mentioned before, for a brand to have a functional value to a marketer, it needs to have some sort of continuity that can carry over from one title to the next. Such continuity is hard to come by, when the average life span of a development studio is between three to five years, barely enough time to develop a few titles at best.

Among the very few examples, Bioware is probably the best one. It is a strong brand, having itself associated with the very best RPG titles (western style) ever known to the market. That brand strength is probably the reason why they have enjoyed working on a significant number of diverse IPs over time: Star Wars, Neverwinter Nights, Mass Effect, and the upcoming Dragon Age: Origins.

If you would rank branding strategies according to their allowance of creativity and originality, Developer Branding would probably be somewhere in the middle. As seen in the Bioware example, it relies on a specific genre expertise more often than not. Yet it is still one step above working on the same franchise to death. Despite the genre focus, Bioware has been able to work on three separate franchises, (NWN, Mass Effect, KOTOR) each with their own creative freedoms.

It is also important to note that Bioware is owned by Electronic Arts, which sets them apart from a third party developer. The reason why publishers seem to prefer first-party titles is not difficult to see: more control over schedules, better integration across functional units, etc. Such control, however, often goes too far, resulting in dissolution of the developer brand.

In short, there are two main inhibitions to developer branding strategy:

Publisher's own business strategy, which often works at the expense of the developer studio
Lack of a sustainable business model on the developer side, which limits the life span of the brand

It is difficult to suggest solutions to these problems as they are rather big ones, other than suggesting that a solution begins with thinking of the problem. Unfortunately too many people see this status quo as an unchangeable property of the industry.

Designer branding in video games (branding alternatives - part 1 of 3)

2009-03-19T02:45:00.000-07:00

In my preceding posts, I discussed the alternative of experience franchising versus the commonly used genre-franchising way of building up brand equity for video games and IPs. In the next three posts, I want to talk about other ways of branding in the video games industry:

Designer branding
Developer studio branding
Publisher branding

Below is the first part.

1. Designer Branding
One could say The Sims franchise relied on the brand equity of the past "Sim-" line of games such as SimCity, SimLife, SimEarth and so on. Or you could say it was the developer Maxis that connected all the dots in its brand essence. My guess is you would not really say that, for you probably know as well as I do, their latest title "Spore" relied neither on Maxis nor any apparent Sim-anything in its name, as much as it did on the brand name of Will Wright himself as its designer.

He is not the only game designer to have a notable brand value of his own. Sid Meier is another easily recognizable name, associated with Civilization, Colonization and Pirates! games among others. That association is a deliberate marketing strategy, as in some cases he was not even the actual main designer of the games branded with his name. Peter Molyneux is another well-known designer of that generation. Jenova Chen is a more recent brand, building up with titles such as Flow and Flower.

The question to ask is:

"What is it about these people that can turn their names into real brands?"

The answer is heart-warming (at least for me): They are all known for having taken creative risks with positive end-results.

The first three names I mentioned are all old-timers, people who have been in the industry since its fledgling, entrepreneurial times. The last one also shares the same spirit as an independent developer, but has emerged only recently. Maybe it is my own ignorance but my mind draws a blank at large when I try to think of a brand-worthy designer that emerged between those old times and the rise of indie games. This comes as no surprise because that slice of time is known to us gamers as a period of brain-numbing unoriginality.

What this tells us is: by trading off creative freedom for risk mitigation, the video games industry has deprived itself of a powerful branding option. In rare cases where originality does shine through, such as in Portal, we see a missed opportunity in this regard where the designer's name is absent or not associated strongly enough with the IP.

One possible reason for that could be the failure versus success rate in the industry. The names Daikatana and Romero are probably the most memorable ones to remind us creative risk can also bring failure in epic proportions. Yet I still believe there are ways around such a risk. Post-mortem branding is an obvious one. Wait to see how well the game fares. If it does well, go ahead and make a star of its designer. Or put their name on the Gold Edition box.

Another option can be cultivating designer name brands one risk level at a time. In the current market where there is much buzz around indie games, it is no longer difficult to reach fame with a small budget title. Could it be a viable business strategy for a publisher to reward successful designers with gradually increasing budgets and brand names of their own? An incubator for the future rockstars of the industry perhaps?

More on franchise branding, and another alternative: publisher/developer branding

2009-03-17T12:08:00.000-07:00

I've read some great comments on my previous posts, and I think a new post will be better to talk about them, rather than addressing each one separately.

There are several common themes in those comments that I would like to summarize:

Multiple genre branding can cause the franchise to lose focus
Not all game universes have enough 'meat' to diversify into different genres
There is room for innovation in a single genre franchise as well
Not many franchises have hit the wall yet

These are all valid points to a certain extent. Yet it is still a dangerous thing to take their truth for granted without questioning that extent of validity.

1. Multiple genre branding can cause the franchise to lose focus
True. Losing focus is bad. Marketing 101 tells us it is important to stay true to the essence of a brand. Yet it is altogether possible to be overzealous in this regard and harm yourself by making your brand a tad too rigid.

Think World of Warcraft. The franchise started out as a real time strategy game, not so different from Age of Empires. When you hear the Warcraft brand name today, however, you think of something else altogether. Is this a loss of focus? Or is it actually a productive, beneficial path of evolution? Compare it to the evolution of Age of Empires, Age of Kings, Age of Mythology and so on. Which path turned out to be a better success? (also interesting to note how the franchise went on with the -craft brand, as in Starcraft. More on this later)

So, the point is: change does not always mean a loss of focus. On the other hand, failure to change can be a bad thing. Look at the gap between the Age of Empires and Warcraft franchises today, for the best example. Or, for a different industry example, think why the Oldsmobile brand is no longer alive today. Loyalty to a core focus is good, but only as long as the core focus is relevant and provides the best leverage to reach business goals.

On the other hand, not all change is good change either. Therefore my conclusion would be: don't squander your brand name with unwise changes, but don't be afraid of changing either.

2. Not all game universes have enough 'meat' to diversify into different genres
Very true. Part of the reason is actually what I happened to talk about in another post of mine; the role of storytelling in games.

In order to have enough meat in your universe, you need to flesh it out. To flesh it out means being able to articulate your universe with creative depth. That, in turn, needs some actual writing talent, an element that is severely neglected in most games.

Back to the first point, such a lack of depth is a strong contributor to that dreaded loss of focus. Simply because if there is nothing else at the core of your franchise but only a genre loyalty, switching genres can ruin your brand.

3. There is room for innovation in a single genre franchise as well
A great point. The example given (by Lee) for this one was the Resident Evil franchise. I have not played a single game of that series, frankly, but I do believe there is room for change within a single genre as well. That potential for change is generally under-exploited by most franchises.

An interesting note, though: Resident Evil belongs in the Survival Horror genre (correct me if I am wrong). The name of that genre itself implies something unique. It is named after a specific sort of 'experience', rather than a specific sort of game mechanic like RTS, FPS, and so on. Could that be part of the reason why Resident Evil 5 had the guts for making changes to the franchise without the fear of losing gameplay focus?

Starcraft is a very interesting franchise to discuss in this context. From a branding perspective, it is an offshoot of the "-craft" franchise which started with Warcraft. It did the job of genre-innovation admirably, pushing the envelope and raising the bar for the RTS genre. A similar impact is hard to find among today's franchise titles.

So when you talk about the branding strategy of Starcraft, you may say "There! An example of a franchise that does well without changing the game genre. It surely defies your multi-genre strategy proposition, so take that!" Please note, however, the Starcraft franchise has all the characteristics of a great starting point for a multi-genre strategy. The universe is rich and detailed, the storytelling component is very strong, and the hero units have personal histories of their own, providing "ground-level windows of perspective" into the game world. This makes the Starcraft experience very easy to transfer into a possible World of Starcraft game.

Let me rephrase my original argument then: a multi-genre strategy does not necessarily mean making games within any and all genres imaginable. Its core proposition is that: it is a good idea to focus on an experience that may provide you with transferability and flexibility across genres, for later. Starcraft may or may not exercise that flexibility, but I am sure the people behind the franchise are glad to have the option.

4. Not many franchises have hit the wall yet
Eventually they will. And some already have. Hitting a wall does not necessarily mean losing sales figures. You may continue to sell five million copies of a franchise with every iteration, but still hit a wall in terms of business growth and market share: things that the shareholders do care about. From that point of view, some publishers have been headbutting the wall for a while now, but it has not been very obvious for two reasons:

The overall market for games is expanding, therefore it is easy to paint a bright picture for your investors.
Among big publishers, market shares have been primarily modified by mergers and acquisitions in the last decade, rather than organic growth of sales.

So when the video game market reaches maturity, and when there are no more noteworthy publishers left to acquire, it will perhaps be easier to appreciate an early start on flexible branding. Then the publishers will realize: in order to grow, they will have to rely on organic growth. And those that do better at organic growth will be the ones who can transfer their existing brand values into new ones.

An alternative way
I was planning to write about branding with publisher/developer name, but maybe that is better left to the next post. So, stay tuned!

Escape from death spiral of franchise branding in video games

2009-03-12T01:34:00.000-07:00

This is going to be sort of an add-on to my previous post on building brand equity for video games.

If you look at the most popular games on any mainstream gaming site today, you will see a heavily skewed distribution towards franchise games. I discussed the driving force behind that in my earlier post, which is namely the ease of marketing a known franchise compared to marketing a new IP with zero brand equity. I will take my argument one step further now, and try to explain why the common franchise strategy is something you want to leave behind.

Creativity vs Risk
To the innovative and creative mind, the explanation is pretty obvious. A new IP brings greater creative freedom. Franchises, on the other hand, have the habit of building up over past iterations, forming rigid skeletons over time. Therefore franchises are not really part of the artistic freedom paradise.

The argument on the flipside is that franchises reduce risk of consumer rejection, which is abundant in any new IP. This does make sense and that is why it seems to be the dominant strategy in the industry among big publishers. But at what cost?

The invention of video game genres brought a similar benefit to the industry; it made the product more easily definable and the marketing message more easily communicable. The downside, as we all know, is that the classification did not only shape the minds of the customers, but of the designers as well. The cost was deadlocking the industry into churning out title after title with the same core game mechanics, which you can do for only so long before your customers start taking their leave for new experiences. Hence the rise of independent games.

The cost is similar with franchising, yet far greater. Not only does it keep the experience limited to a single genre in most cases, but it also keeps things limited to a very predictable and same-old version of one particular interpretation. Two things will eventually happen this way:

You will limit your growth: There are only so many hockey fans looking to buy NHL games. There are only so many mainstream sports you can make a game about. There are only so many wars to build a game around (I'm betting the next Total War title will be "Medieval III", and the next Call of Duty will be... "Marginally Further Modernized Warfare with Tanks This Time")
Your customers will start realizing they are buying the same games over and over again.

Risk vs Evolution
Here is my main argument:

Most franchises are so focused on refining their specific brand of gameplay experience, that they expose themselves to the threat of extinction by the way of becoming evolutionary dead-ends.

A good example to this is found in the animal kingdom. A cheetah is a highly specialized hunter, built for speed. Yet its high level of specialization comes at the cost of adaptability. So much that its fate is deeply tied with that of its prey and its habitat; should anything happen to the species it preys on, or should any parameters of the habitat change by even a small bit, the cheetah faces the risk of extinction because it has long lost its adaptability. It is an evolutionary dead-end. Same thing applies to brands.

Therefore the key to building a long lasting brand is leaving yourself room to grow, by choosing values that can transcend your most immediate time and habitat if needed. Failure to do that means losing a brand more often that you would like, and having to start from scratch again. You want to avoid that because it is costly and it draws the scorn of your customers for limiting creativity and variety.

The Solution: Brands built around experience, not genre
I have one name for you as an example to this alternative strategy: Tom Clancy.

Over the years we have seen a number of games with the Tom Clancy name: Ghost Recon, EndWar, HAWX and others. Although the series shows an inclination towards a first person perspective, we have recently been given a strategy game and a flight simulator game as well.

There you have an example of a brand equity that can communicate an idea beyond the limitations of a single genre. The name of Tom Clancy immediately makes one recall the experiences of military operations, what-if conflicts, special forces, political tension, etc. If they announced a submarine simulation game tomorrow, you would know what to expect. Can you say the same if the next Call of Duty game was announced to be a flight simulator? How about a strategy game with the Far Cry title? Any idea?

The vast variety of Star Wars games is another example. Simulators, strategy games, first person shooters, RPGs, all branded with the Star Wars experience. A more recent adaptation of this branding strategy is seen in Halo Wars. With the Warcraft franchise, it took a hybrid step to make the transition from RTS to RPG. Looking at the result, it has obviously paid off.

Perhaps "Experience Franchising" does not have infinite flexibility either, but it is a vastly more adaptable branding strategy compared to most other franchises obsessed with particular genres. Such flexibility is more suited to an industry built around the art of design, as opposed to a focus on genres and features, which are characteristics of ugly commoditization.

Save your game from that fate. Start thinking what your brand should stand for today and tomorrow.

Building brand equity for your game

2009-03-07T13:51:00.000-08:00

Here is an article about video games companies thinking on innovation. Let me copy the part I found thought provoking:

Wedbush Morgan analyst Michael Patcher was quoted as saying "Few companies perform well when they are focused on so many new games…We haven't seen Activision introduce that many new brands over the last few years."

What caught my attention was the word "brand." Personally I shy away from thinking every title as a separate brand, simply because most titles lose relevance after a certain (and often short) period of time. Semantically you can argue that a title does mean a brand. And I encourage that argument, because for once, arguing semantics might get us somewhere.

For a title to become a brand;

it needs to develop an identity that is distinct enough to be recalled on its own.
But more importantly, it needs to have continuity so that the brand will have functional value, not just for the customer, but for the marketer looking to make use of it.

The second point is the driving force behind franchises. A franchise semantically and functionally represents a brand because it has the quality of having a brand equity. It has a functionality (for the marketer) that carries over from one title to the next. Building a game franchise is essentially the practice of building up brand equity. In that respect, it is easy to understand the preference on franchises over original IPs, because marketing for the former means a greater ROI, whereas the latter might just sink to the bottom with your advertising dollars in its belly.

Survival of the fittest title
Publishers are being increasingly criticised for not backing up their new IPs adequately. Mirror's Edge and Dead Space are the latest examples. This lack of marketing support even seems to be somewhat deliberate. It is a survival of the fittest strategy where new IPs are left to fend for themselves in the market, with minimal support. If the title somehow manages to sell well despite the cruel parentage of the publisher, it is deemed worthy of being a franchise. Then you start to see full page print ads and even TV ads. If not, they say it was never meant to be.

Survival of the fittest concept works very efficiently in nature and evolution. It does not seem to work that well, however, when the new IP in question needs millios of dollars to develop, only to be set up to fail by its own publisher. It is simply too late a stage to use as a filtering mechanism, and it is a Bad Idea for New Product Development(tm).

Alternative ways to build brand equity
How do you build equity without having to pump three or four games into a franchise then? The answer may lie in utilizing media other than the video games medium itself.

The best example I can think of is the game from Penny Arcade, titled Rain-slick Precipice of Darkness. It was hardly a franchise when the first episode came out, yet it did have an identity and equity of its own already, thanks to the Penny Arcade webcomic. Actually the same duo has also done work for video game marketing campaigns, such as illustrations and mini-comics for Prince of Persia and Fallout. The difference, though, is that Penny Arcade comics have represented what lies at the heart and soul of their own game. Their illustrations for other games, though, are simply the requisite humour section of a game website.

So the question is: How can you convey what your game stands for, without having the final product in your hand?

The answer might include:

Pin down what your game stands for at its heart and soul, as early into the project as possible: This will give you more time to promote that core idea over the next couple years of development cycle.
Look for simple, low-cost ways of promoting the core idea: Titles alone mean little to consumers. Mirror's Edge does not ring any bells just by its name. The phrase "urban ninja" however, immediately creates a mental image of those crazy people jumping from one rooftop to the other. How costly could it be to get one of those guys to endorse the game? Or to post clips of people doing those stunts in real life, on Youtube? There you have a non-digital game demo. It is easier to promote the idea of an urban ninja, than it is to promote the actual brand name of Mirror's Edge. Associating the two might be the thing your brand needs to take-off.
Make a playable demo available as soon as you can manage
Use other media such as stories, mini-games, animated series, comics, etc: Not as after-thoughts like the comics section of your newspaper, but as focused, consistent efforts to promote your core idea.

I am sure there are more ways that I am missing right now. Any thoughts?

The role (and myths) of storytelling in video games

2009-03-03T01:25:00.000-08:00

As I have been told by Kenton Low of New Media BC (whom I had the great pleasure of meeting last week), there are three main reasons why people play games:

For the sake of intellectual exercise and discovery (such as puzzle games)
To satisfy a perpetual need to compete and win (think 'deathmatch')
For the sake of the story that the game tells

It is very easy to think examples of games that satisfy the first two needs. The third one, however, is somewhat rare. For me it is somewhat astonishing that the power of video games as a storytelling medium has been underappreciated so much. Given the high potential of interaction and immersion native to video games, one would think it is an obvious improvement over film, where there is no real interaction between the passive audience and the content on display.

Greater is my amusement when people discuss, with a certain fringe attitude, whether a game can make you cry, or inspire, or impart serious wisdom on you, and whatnot. I say amusing, because people who think the answer lies in the future, are the people who are ignorant of what has already been achieved on that frontier with some very fine examples of storytelling.

Think of games like Planescape Torment: one of the best examples of storytelling for its narrative power and deeply philosophical essence. Think Braid, a puzzle game with a very personal, very humane story to tell, which transforms the game itself from simple block pushing into a genuine emotional experience. Think Portal, another puzzle game that keeps you constantly looking forward to the next level, just to hear the next piece of GLaDOS' crazy monologues.

The cake is a lie, obviously, but the power of storytelling is not.

Myths of Storytelling

Storytelling only belongs in roleplaying games: It is true that a story is most integral to the RPG genre (although the Diablo franchize deviates from that). Yet all genres can benefit from good writing. Braid and Portal, as mentioned above, are two obvious examples of games where the experience is much enhanced by a good story.
A focus on storytelling needs the player to read too much stuff on screen: A misconception related to the first one. While certain roleplaying games revolve around extensive dialogues that require the player to choose what to say, this does not need to apply to other categories. Half-life delivered a pretty good storytelling experience without a single line to Gordon Freeman's name. Different genres can use different game mechanics to advance the storyline.
You need a hero saving the world/galaxy for a good story: More often than not, this actually hurts the immersion factor of a game. You are thrown into a strange new digital world with so many things to explore and immerse yourself in, but no. There is no time. Evil armies are marching. But of course, you are the only one who can stop them. Your typical interactions with the game world characters usually result in a) Them not believing your pitch about evil armies, and continuing to plow the fields as if nothing's happening, or, b) them believing you and sending you alone to deal with it, again continuing to plow the fields. In any case, what you end up with is an experience utterly detached from the game world you were hoping to be a part of. In most cases, for all we know, your hero might as well be a severely delusional village-idiot who hallucinates such evil armies marching, much to the amusement of farmers who plow their fields under any circumstance.
A good story needs to be non-linear: Not really. Sure, a non-linear story experience can add a nice touch when pulled off well enough, but a linear story can just as well do the job if it's interesting enough. In fact it may be a better idea to stick to a linear story, rather than a half-hearted attempt at creating an illusion of choice.
A good story takes a lot of writing talent: Well, yes. Then again, I'm fairly confident that the kind of money that buys Kiefer Sutherland's voice or Tricia Helfer's acting, would be more than enough to employ top notch writing talent, which would add a lot more value to your game than celebrity appearances.
Every story needs to be about a fight between good and evil: Your audience is not limited to the Power Rangers fans anymore. Black and white morality is overdone to death. Fresh approaches with morally ambigious or flawed characters are ruling the day. Look at Battlestar Galactica, Dexter, or House MD. We need more of that stuff in video games too. We need intellectually mature content. Preferably such that does not think being crass equals being mature content.

Well, this is all I can think of at the time. I might post additions later. Let me finish this one with another great example (for me, at least) of storytelling.

Freespace 2, possibly the best space simulation game ever made, also had a pretty masterfully crafted story:

for its emphasis on a rather ordinary character rather than a special one,
for its empasis, not on a fairy tale victory, but on a gloomy, gritty struggle for survival,
for the way it gave the sense of epicness in size and scale without resorting to cliches,
and for its appreciation of mystery and leaving things to the imagination.

That was 10 years ago.

Can a video game make you cry? Can a publisher be taught the potential of their own medium?

What Hollywood Knows that Video Games Industry Doesn't

2009-01-28T11:27:00.000-08:00

The article where Rockstar's Dan Houser voices his appreciation for the lack of respect is over here at gamesindustry.biz website. The argument is that the low profile of video games have prevented things from becoming codified as it has in traditional media like TV and film, allowing for creative freedom.

I would think perhaps 'refinement' is a better word in the case of the traditional media, which video games seem to be lacking in large quantities.

As for "creative freedom," I'm at a loss as to what that might mean, since I am unable to observe a great deal of creative originality that (one would expect) would result from such freedom.

The successful people of Hollywood know that artistic freedom in film does not mean a lot when you forget to put the singularly most essential ingredient in a movie. No make-up wonders, no CGI wizardry, no sets and no props will save a movie from being a total dog when it fails to deliver on the primary attribute: storytelling. No story, no movie. (Compare The Dark Knight or Batman Begins to previous Batman movies with Val Kilmer and George Clooney, and you'll see what I mean)

Things might be said to have become codified on that front, but for the purpose of supporting that primary goal. Storytelling has long been an art form, and those traditional media have almost perfected the techniques of its delivery.

When you apply that lesson to video games, that essential, primary ingredient becomes gameplay. Again, just like in movies, no amount of graphical awesomeness, no celebrity voice-acting, and certainly no advertising genius will save you from the contempt of gamers who had paid 60 bucks for a total dog.

Today's games have, perhaps, a great amount of artistic creativity in them, but not so much where it counts. There is not enough game in video games anymore. While the said artistic freedom might benefit the artist himself or herself by allowing for a more diversified professional portfolio, it does very little to advance the medium itself to its rightful place.

Let me finish with a direct comparison: if Hollywood did things like the video games industry, we would have seen some 15 versions of the same The Matrix movie by now, all with exactly the same story and script but with different make-up schemes, different special effects, different actors and such.

Great for the artists. Not so great for the audience or the medium.

Game rental business and what (not) to do about it

2009-01-14T20:13:00.000-08:00

There is much talk about the game rental business and what a threat it can be to the revenues. Despite the call for defensive maneuvers from the games industry, the rental sector is continuing the expand. The most recent news on it are from the UK, and the reactions to the retailer GAME's announced move into the rental business.

After reading about a variety of ideas on the matter, I decided to share my own opinions and suggestions here.

WHAT (NOT) TO DO

Do not jump the gun for defensive measures.

The worst you can do is fighting change without understanding the factors that have brought it. You may find yourself winning a battle against the symptoms, but not the real cause of the issue.

Do take time to understand 'why.'

Why are people renting games instead of buying them? Why do they think the product is not worth the retail price? Why do they not feel attached to the physical product? These are all very important questions you should be asking yourself.

Do not see the rental business as the enemy.

They would not be in business if there was not a demand for them from the customer. Go back to the 'why.' Why is there a demand for the value they provide? Where does the value come from? Their very existence should give you hints about what you can do better.

Do understand the concept of 'value added.'

Look for the gap you have left in your own value offering that led to a demand for rentals. People are burnt out from paying $59 for a few hours' worth of cheap thrills. Ask yourself whether all the price-inflating features you pack in a game really get appreciation from the consumer. (I still cannot believe they had hired Kiefer Sutherland for Call of Duty. I had to pay for his voice and I didnot even know --let alone care-- until somebody told me. There's a golden example of a non-value added feature.)

Do not fall back to primitive, backwards ideas to block/restrict/limit/fight the consumers' access to value.

In a time when consumers are crying out en masse against DRM schemes, such actions to put limitations on content will hurt you in the long run. The modern business philosophy is all about providing value, not taking it away. If you think you can win by 'legally exploiting' your customers, you do not have a place in the future.

Do look into ways of improving the value of your product at retail.

Pack some jam into those DVD cases. My disappointment with the game itself aside, Fallout 3 Collector's Edition is a great example for how to differentiate one's product from the masses of plastic, soulless vessels. For me, a bobblehead made all the difference between rental and retail. I am sure brilliant minds can come up with many different ways of making the retail value worth the price again, if only they take the time to think on it.

Do not just hold your breath until the digital delivery revolution.

The consistent move towards digital distribution may just be the solution you want, at first glance. However the fact remains that it would only remedy the symptom of revenues bleeding to rentals, and not cure the true cause of it. The underlying issues will surely surface again sooner or later.

Do read about the music industry versus mp3 format again.

There lies an example of how much ground you can lose, simply by arrogantly and ignorantly fighting change instead of learning from it.

And do remember; ultimately it's the customer who puts the price on your product, not you. It was never some royal decree that you should be making money, and it will never be.

I didn't like Fallout 3 either

2009-01-12T11:37:00.000-08:00

And I'm a die-hard RPG fan too. Despite my fondness for the genre and the franchise, however, I could not help being able to relate to Scott Jones in his admission. He attributes his earlier reluctance to come out of the closet to 1. the developers, and 2. the game's pedigree. For me, it was a different reason that I tried my best to convince myself that I liked it even though I was not really impressed.

The reason is simple and somewhat laughable: I was afraid of what it could mean if I admitted not liking it. Could it mean I was getting old? Had I lost my appreciation for the medium? Had my inner child died? The answer, I realize, is none of those. It is something far worse perhaps: the gaming that I used to like seems to be dying, if not dead already.

For me, my fascination with games was always for discovering something new. When I was a little kid, I did not have internet access to read reviews from. I could not even find any gaming magazines to read in my country. So it was a treasure hunt each time I went to the computer store, and read the long (and sometimes handwritten) list of games, picking titles I had heard about but not knowing what I would get. And yes, they were pirated copies. But simply because no company was shipping to my corner of the world in those days. I used to play games with no tutorials, no manuals, spending hours and hours trying to understand how it all worked.

It was the talk of the whole school when some kid managed to make the jet fighter take off in some simulation game. Knowing the way to tackle a tough puzzle in the Secret of the Monkey Island was a golden bargaining chip in many situations that a schoolboy might have to settle with his peers. Being one level ahead than the next kid on Dune 2 meant being on a whole different level of existence, as you had access to wonders that they did not. Back in the day, gameplay duration given in hours used to give you an idea about the amount of treasure buried in a given game, the amount of things to discover. These days it simply means how much of a drone-like activity you will repeatedly perform until you reach a sorry excuse for a story ending.

The games I loved used to stand for originality. They used to give me an incredibly valuable resource for my mind: a venue for discovery. It saddens me greatly to realize that this huge benefit has been taken away from me. It saddens me to know that when I look at the DVD cases at the retail store, I know exactly what makes them tick without opening the case, let alone playing them. They all follow the same 'tried and true' formulas of RTS, RPG, FPS, whathaveyou. They were all designed with the common sense of 'not fixing what did not break.' Sometimes I know it all just by hearing the name of the title. I know all too well how it will play out, what resources I will gather, what mechanics I will utilize, what 'world changing choices' I will have to make, and all that good stuff. -- (I also have to note; it is becoming something of an industry norm that whenever someone speaks of world changing choices in a RPG game, it turns out they were referring to a very singular and isolated instance in the whole game, outside of which everything is scripted and streamlined like an elementary school play)

I was hoping it would be different, that it would be like the good old days with Fallout 3. After reaching level 8, though, I no longer see a point in going any further. There is nothing left to discover. All the areas unlocked thereafter, all the dungeons I have missed, I am pretty sure I have already seen them in other games if not in Fallout 3 itself.

This is why people (including myself) are playing more and more casual games. Because we find something in those games that I cannot find in Fallout 3. When a browser game loads, I find joy in the fact that I have no idea how it will play out. Sure, it takes me less than five minutes to figure it all out, but guess what, then I can move on to another without having to pay $59.99 again. In that sense, it is ironic that what people call casual gamers might very well be the true hardcore gamers, for what they derive from the experience is what the medium used to stand for.

I sometimes think whether the video games industry is just waiting for that group to die out, so the marketing divisions will have no trouble selling their games to impressionable youngsters of the future who will have nothing better to compare to. It is a bitter thought along with the predictions in the news saying games will be the dominant media of the future. There was a time I would be very excited about that statement. These days I don't even know if we are talking about the same thing when they say 'games.'

Co-production, digital distribution, and the future of video game publishing

2009-01-06T12:15:00.000-08:00

The inspiration for this post comes from a developer interview on GamesIndustry.biz. The interview talks about the co-production method of development, which involves multiple studios coming together to complement each other with their respective core competencies. The benefits are the distribution of risk and greater accessibility to talent in various fields. Daniel Kozlov sees this collaboration method as the future of game development. The interview made me think of what this could mean from a greater perspective.

Publishers in the video games industry have three main roles to play in the value chain:

Marketing of titles
Distribution of titles
Technological support for development

Look at that list and try to imagine what it will look like in the future. Most people agree that digital delivery of titles is the future, which would make physical distribution of CDs and DVDs obsolete. So, cross distribution off your list, as it doesn't take much muscle to put a title on an online server for digital distribution on demand.

Now back to that interview with Kozlov, it seems to me that co-production could also lower reliance on publishers for technological support. So that bullet on the list becomes much less certain, if not crossed off altogether.

What remains is marketing. In my blog I have discussed examples of great marketing that does not necessarily involve million dollar budgets. Viral advertising and word-of-mouth are tactics employed very successfully by some independent developers.

The question is, will there be enough room in the value chain of the future, to justify the existence of publishers as we know them today? Or will publishing be reduced to involve only the console manufacturers like Microsoft, who would merely enforce platform standard compliance and make titles available on Live? On the other side, is it too far fetched to imagine production studios becoming their own publishers?

Much Study About Nothing

2008-12-31T14:14:00.000-08:00

I followed a link on Penny Arcade to this article about gamers and their self-images. It is about a study conducted by a professor of psychology in Kansas State University. Basically he has exposed students to video games that feature characters of 'extreme physique' for 15 minutes at a time, and he has found out that the subjects had displayed increased levels of insecurity regarding their own bodies, after the experience.

“It was kind of sobering that it did have such a short-term effect,” Harris [author of the study] said.

Even though this blog of mine is about the business side of things, I cannot help but comment about this one. The real sobering issue in this study is that even the scientific community is not above taking cheap shots at video gaming for the sake of gaining popularity, for I highly doubt this study of Dr.Harris would find any homage in any scientific journal of any kind otherwise.

I am not a psychologist, but neither do I need to be in order to call someone on it when they point out the obvious. The methodology of the study is probably the most ridiculuous thing I have heard in a long time. Exposing people to images of, let's say it, "beautiful people" would have the same effect on any medium. It could as well have been on TV or magazines. Spending 15 minutes in the same room with a person of above-average physique would have the same effect.

Why? Because, my dear professor of psychology, it is a thing called relativity. Our perception of self constantly readjusts itself based on the most immediately available reference point. You can feel tall after spending 15 minutes in the same room with a bunch of midgets. You can feel 'dwarfed' by a team of basketball players after 15 minutes of playing with them. If a field expert can call the display of such a blatantly obvious human characteristic to be "sobering," I would be forced to question their sobriety throughout their academic career.

A more meaningful study would have been looking at the long term effects of the issue, but of course, why bother when you can complete a scientific study in 30 minutes?

EA lay-offs: did they have it coming?

2008-12-19T10:59:00.000-08:00

I came across this discussion on Gamespot forums about the most recent news from EA, concerning more lay-offs and earnings below projections. I made some comments on that forum but I thought I'd write about it here as well.

Essentially there are two groups: one group of gamers claims it was the quality of the games that brought EA to this point. The other group says it is the economic recession hitting every industry and not just EA.

Here's what I think:

True, the quality of the games probably does not play the only major role in EA's most recent lay-offs. But it still counts. The rise of casual gaming partly owes its existence to gamers being underserved by flashy triple-A games sold at 50-60 bucks. Ironically, the general consensus in the industry has always been welcoming that new segment, thinking it is almost entirely made up of people who were not playing games before. Truth is, there are many hardcore gamers out there who can no longer get the satisfaction they seek in a blockbuster title, whereas those cheap thrills provided by casual games seem to be much more addictive and truer to the spirit of gaming.

Similarly, indie games have been gaining popularity fast, even before there was such an ugly economic situation. Do check Google Trends by typing in "indie games" and you will see this has been going on for a while. There is at least one thread about indie gaming on many gamer community forums, where people are asking where to find quality, original titles that triple-A's cannot match for some reason.

A while ago, I quoted Jay Sampson of Massive Inc, on in-game advertising:

“There are more lines of code and more development hours invested in creating really engaging video games. If I’m a publisher or developer, I’m saying,‘Where’s my new offset?’ Advertising is becoming a bigger part of that offset."

The topic of this post is not in-game advertising, but there is a very interesting message between those lines. With any other industry, the question that would naturally follow after this quote would be: "What do you mean where is your offset? You are telling me you are doing all this extra work, spending all those extra dollars and you are not getting anything for it? Well, maybe it is because whatever you are doing is not value added! Maybe the things you thought that mattered stopped mattering a long time ago."

The much blamed game rental business has in fact been driven by this ignorant underserving: why would I pay 50 bucks for a game that I will stop playing after five hours into it anyhow? What value did they ever put in those plastic CD cases? How much longer did they think I would play the fool by believing their cheap marketing tactics?

A couple months ago, I attended an EA recruitment session in University of British Columbia campus. The HR representatives of the company brought the issue up themselves in their presentation without any prompting from the audience: "Lack of creativity in EA games." Of course their point was to deny it altogether, but their mentioning of the subject did happen to acknowledge the popular consumer perception about such a lack of creativity, regardless of what they tell the investors about what a lovable company they are.

The very fact that there are so many gamers out there who wouldn't shed a single tear for EA, should be the most striking indication that they have been doing things wrong for a very long time. Warning signs and alarms have been going off in many different ways, albeit falling on deaf ears. Finally the recession has amplified the noise enough to alarm them. Even then, it will be very unfortunate if the industry blames it all on the economic crisis, without taking any deeper lessons from the situation.

An integrated game design and marketing model for commercial success

2008-10-19T15:19:00.000-07:00

Since the very beginning, my goal in writing this blog has been understanding the disconnection between commercial success of a video game and its genuine quality, as one does not always imply the other. After about a month's worth of contemplation, focused observation and interviews with industry professionals, I am finally able to develop a semblance of understanding as to what is possibly happening in the industry.

The first part of this post will illustrate the current design and marketing interrelationship. The second part will be proposing an ideal relationship model that can offer much higher rates of commercial success.

1. Design First, Sell Later

I will try to explain this approach with a purposefully simplified example; assume that you have decided to develop a strategy game, based on your experience/gut sense/preliminary market research/etc about what will sell in the market at that time. From that point on and to the end result, you will have to make many decisions about the game along the design process.

Let's say you want to decide what sort of strategy game it will be: real time or turn based. Based on the results of your decision, you can end up with two completely different games. It is also highly probable that the consumer reaction to (and subsequently the commercial fortunes of) these two outcomes are not quite equal. Green circle in this example represents the better outcome, with yellow being the second best.

Most game designers pride themselves in understanding the gamers and what they want to play, for they are gamers themselves. I will not argue this point one way or another, at least not in depth, right now. Let us assume instead that in this case the designer has chosen the right option and has decided to go with a realtime strategy title. Everything is perfect for a little while, until you come to the next decision point.

This time you are perhaps trying to decide whether to go with a futuristic setting like Starcraft, or with a medieval theme like Age of Empires. Again one of the two will resonate better with the gamers than the other. Perhaps one of them (shown as a red circle) will be a total flop.

Right after that decision comes another: should you include two factions or three? Maybe four? Maybe add customizable factions? As you can see, each decision point adds new combinations and new possible outcomes to the overall picture.

Imagine how many of such decisions you have to make along the design process, big or small, visible or in the background, visual or technical, story-wise or mechanics-wise, and so on. Many decisions later what you end up with is a quantum cloud of possibilities:

Of this huge set of 'alternate universes,' only a small fraction will lead you to a hit title. A greater portion will probably fall under the acceptable or average category, while even greater is the possibility of a complete commercial failure. The aim of the design team is, then, to go through this whole decision tree with the most number of green circles, in order to maximize the chances of ending up in the green zone.

Remember: a green circle represents an outcome that will have the highest positive reaction from the consumers. It is not about chasing an absolute truth in game design. It is about giving people what they will like to play. So the chase for green becomes chasing an insight into the gamers' minds, to find the choices that will resonate with them most.

Guess whose job that is.

If you consult with the marketing people of the big game companies, they will likely tell you about the focus group studies, the open betas, the online forum posts from fans, etc. These things are sure to give you insights about gamers, right?

Let me tell you how well this works: imagine you want to drive your car from Vancouver (BC) to Lima in Peru. If you exclusively relied on the sketchy directions given to you by ten random people in downtown Vancouver, then maybe a hundred more along the way a year later, and not to forget your team of enthusiastic road-trippers, your chances of finding Lima on your own would be about just as high as coming up with a great game that also sells great.

As a consumer myself, I have observed the above scenario many times, with the end result of them ending up somewhere in Quebec instead and spending lots and lots of advertising dollars to convince everyone in town that they are in fact living in Peru. This is known as push marketing.

This is also why they are very unwilling to take chances with new directions. This is why they are more than happy to manage a ballpark with a title (because it is an amazing feat), and then reiterate it countless times with incremental changes, hoping to find the street address one day in the distant future. The problem is, though, the address keeps changing. Thus there is a never-closing gap between where we -as consumers- want them to end up, and what they can manage with their current pathfinding techniques.

2. Concurrent Design and Marketing

The solution: integrate the end user into the design process as much as possible. The best example of this approach is my favorite indie game Mount&Blade, but it is possible to see other examples in many other industries. What amazes me is the fact that the designers of that game got it right in their first try, while most industry people are not even aware of this unbelievable feat yet.

What they did right was releasing the game as soon as it was playable, and continuing the design process along with the end users. Every update got immediate feedback. The reactions to every little change, tweak, fine-tuning was immediately observable. Forty thousand people paid them to do their beta testing, and to co-develop the game with them. At every stage of the decision tree, thousands of fingers pointed out the green circles to them.

Leave aside the puny sample sizes of focus group studies/surveys, and try forty thousand people on for size. That many people did, not only their product development marketing, but also their advertising as well. I urge you to check out the Gamespot review for the game, and see the glaring disparity between the reviewer's rating and that of the gamers'.

Why do they love a game with graphics nowhere near AAA titles? Why a game that did not get marketed aggressively? Why a game that scores a shameful 6 on Gamespot's review? Simply because Mount&Blade did what the others could only dream of doing: it found the street address. And all that with a team of two people and a shoestring budget for absolutely everything.

Compared to the traditional video game marketing trip to Quebec, this approach is no different than having an onboard GPS system. The success of this humble indie title was no coincidence. It was, in fact, almost impossible for it to fail.

You may argue that the same design method cannot be applied to every situation for this reason or that. Just remember that while you are arguing that point, someone else out there may be just about to make it work for them.

And once that happens, imagine what a company that never misses can do.

Pictures from eMarketronics

2008-10-12T13:38:00.000-07:00

It's been almost a week now and I finally have the time to post some pictures from Monday. Once again, thanks to everyone who graced our booth. We were most pleased with the level of attention we were getting.

It is yours truly in this one, posing right before our booth.

Miguel and Sandy presenting our research. A pretty animated and intense presentation too from the looks of it.

In-game advertising compilation

2008-10-04T14:26:00.000-07:00

As promised, here is the complete filing of our in-game advertising coverage for Sauder eMarketronics event. This includes links to the blogs of Sandy Coupier and Miguel Maza, who worked with me in preparing this coverage.

Enjoy!

In-game advertising and video games industry: trends, challenges and implications

2008-10-03T16:42:00.000-07:00

This article - along with the other two that I will soon link to - will be the gist of our in-game advertising coverage in next Monday's Sauder eMarketronics event. In this post you will find the trends, challenges and future implications for the video game industry in regards to in-game advertising. So without further ado, here it is...

Trends
Game development costs are climbing with the ever-increasing complexity of the production process. “There are more lines of code and more development hours invested in creating really engaging video games. If I’m a publisher or developer, I’m saying,‘Where’s my new offset?’ Advertising is becoming a bigger part of that offset,” says Jay Sampson of Massive Inc, the in-game ad agency owned by Microsoft.

Justin Towsend, CEO of IGA Worldwide, puts a range on this advertised offset in an interview with Gamasutra: “We hope in-game ads will go on to support up to 15-20 percent of production costs – but nowhere near 100 percent.”

The industry-wide offset is expected to be $1 billion dollars by 2012, the total number that in-game advertising spending is going to reach. Nearly half of that spending is expected to go into web based games.

Meanwhile the in-game ad space is evolving rapidly to attract the advertisers, with development of new technologies and accumulation of experience in this field. The future of this new advertising front seems to be pretty promising, as evidenced by the big players taking positions already. One such move was Microsoft's acquisition of the in-game ad pioneer Massive Inc. With a similar move last year, Google acquired AdScape and the rumour is that an in-game version of Google AdSense is coming soon. This possibility is further reinforced by the Google Lively project, a virtual 3D world that will be providing an open platform for independent game developers.

Challenges
This promising market is not without its challenges. The attractiveness of the medium largely depends on the amount of tactical flexibility it can offer to advertisers, such as fast deployment capability, real time control and reliable performance measurement. As such, creating versatile ad space within games is important for the future of this medium as an advertising platform. On the other hand this adds yet another layer of complexity to the coordination of game development efforts.

Independent sources claim that the biggest challenge so far is coming up with a reliable unit of measurement for ad effectiveness. In internet advertising market, this unit would be 'clicks.' Thus, the in-game advertising industry needs to invent its own click, a consumer response measure that is universally accepted.

Unquestionably another key component of the future is winning the consumer's acceptance for ad presence in games. Any campaign to ruin the entertainment experience would have a big chance of backfiring on both the advertiser and the publisher.

If video games imitate movies, then they should also follow the trend with in-movie advertising. Product placement in movies is evolving into a different model: incorporating brand directly into the storyline. Of all the examples, Audi and US Robotics presence in the Will Smith movie I-Robot would be the best one. An in-game application of this model would require close collaboration between the brand owners and game developers.

Implications
A traditional coping mechanism against increasing development complexity has been acquisition of game development studios by publishers. Games developed by such in-house studios are called first party titles. Considering the challenges that lay ahead for in-game advertising, it is not hard to imagine publishers increasing their preference for first party titles in order to have better control over addressing such difficulties.

For static ad placement, it is reasonable to assume that long standing franchises (such as NBA, FIFA, Sims, NHL... see a pattern here?) would offer more reliability for their high degree of predictability in terms of sales and gamer demographics. On a similar line, video game genres or franchises can develop portfolios of brand categories that can be supported in their games. A portfolio loyalty, in turn, could limit the availability of creative directions.

In-house game development, coupled with choices in favour of predictability, may turn the industry into a closed loop system where fresh and innovative ideas would have a hard time penetrating in. This means a risk of value decay and loss of entrepreneurial responsiveness.

As a result of increasing demand towards dynamic ad control, online gameplay technologies will probably see an emphasis greater than ever before. General marketing efforts can also be expected to intensify in driving the consumers towards online gameplay.

The question of where the in-game ad revenues will end up is another important one. If they are used as an offset for reducing the prices of games, the result could be increased sales and extended reach for advertisements (which could create a positive feedback loop), not to mention a boost to the consumer acceptance of ads. Revenues going straight to the bottomline, however, could upset the balance between what consumer wants to see and what the publishers are willing to invest in. The end result of such an imbalance could be stagnation in sales, which in turn could reduce the attractiveness of the medium for advertisers.

Although the exact direction can be argued, it is almost certain that advertising will have a profound effect on the future of gaming. Whether this will be good or bad depends on the industry's ability to understand the dynamics between ad and entertainment content, and to create a mutually supportive business model out of them.

The currency of online social networks, and the new evolutionary paradigm

2008-09-30T03:33:00.000-07:00

You should definitely read this post from Daniel James, on Penny Arcade news. He is the CEO of Three Rings, the company that brought us the highly popular Puzzle Pirates online puzzle game.

Daniel touches a good number of points regarding what I personally call "the new evolutionary paradigm of the internet." Here is a small taste if you are not yet convinced that you should read it:

"The cheddary 'Free to Play' is not just a cheesy marketing slogan, but a shift in assumptions; it costs approaching nothing to give away some bits, or let people play Puzzle Pirates for free. Every player, free or paid, adds value to the community and excitement for other players. Free players are the content, context and society that encourages a small fraction of the audience to willingly pay more than enough to subsidize the rest."

It is a proof of concept for a business model that uses a currency most unimaginable for the traditional business mind: love.

I may be getting ahead of myself here, but this has reminded me of my favourite scene from the movie The Waking Life. In the below scene Dr. Eamonn F. Healy discusses his prediction of a radical shift in human evolution in a very near future, a point of singularity if you will. The traditional evolutionary paradigm that is based on war, predation, and survival will be replaced, he claims, by a new paradigm that is based on neo-human values of freedom, justice, loyalty, and -I would add to the list- love.

Daniel James' post made me wonder if the success of his game could be a manifestation or a sign of this impending revolution. Another obvious example is Google and the value of transparency.

Unlikely, you say? Here is another question then: what has been the mankind's most constant demand throughout history, if not a better world?

I have to admit that I may be predisposed to optimism in this. Still, it makes me all warm and fuzzy inside to think the interwebs might be channeling the collective will of mankind to tell the evolution itself, the most powerful force of nature, what really matters.

Game developers define success

2008-09-29T11:57:00.000-07:00

The question I asked on LinkedIn was:

What is your primary measure of success for a title you have worked on? Is it the number of sales, the reviews, direct fan feedback or something else that matters to you?

Among those that answered were devs from Rockstar Games, Sony Computer Entertainment, EA, Gas Powered Games and more. What did they say?

"...sales figures. It's always nice to see good reviews, and it's great when you get a lot of positive feedback from fans, but if the sales figures are really bad, it's going to have serious consequences for the company you work for." (Eric Gooch, Insomniac Games)

After a couple answers like this, I thought this was all I was gonna get. But then there came more balanced answers like this:

"As an artist, this success comes from the satisfaction of seeing your work excel, and being acknowledged by the masses, and your colleagues. Success is not only measured in terms of numbers, but in terms of personal goals being met, and hopefully surpassed. The industry has shifted in the past 5 years to a pure monetary gain standpoint. Somewhere in that attitude the main point is lost, great games. Artists and designers alike, tend to not be equated in the overall completion factor of high profile AAA titles. If more development studios acknowledged their key and striving talent, the sales would increase and the turnover rate would decrease. It takes people to make great work and drive sales, sales don't necessarily dictate success." (Tom De La Garza, Rockstar Games)

And these:

"Now certainly, sales, earnings & client/fan approval are always a part of any design goal, and you absolutely strive for financial success every time, but I've found that if the dollar is the driving force, the game ultimately suffers. As a designer, I always prefer to stay focused on the game & game play, and let others worry about the best way to sell it."(Brian Colin, Game Refuge)

"A mix of sales figures, brand identity, reviews, and first hand accolades are all contributing factors to what I deem successful accomplishments for a studio title." (Robert Baxter, Blue Castle Games)

My question was inspired by an interview with Michael de Plater (on GamesIndustry.biz) saying that first party titles had a better chance of success compared to third party titles. It made me question the definition of success. The first question that appeared on my mind was: "If a poorly designed, poorly built game still manages to sell well, exactly whose success would that be? Dev team or the marketing team?" That is why I felt a developer's understanding of success would have to differ somewhat from a publisher's understanding of success.

Looking at the answers, I am glad people are still aware of the distinction.

P.S. Interested in joining the discussion? Visit the Game Developers group on LinkedIn.com

Video games and business - Part III

2008-09-24T20:18:00.000-07:00

Back in the 1950s Peter Drucker had pegged it down very nicely: "... any business enterprise has only two basic functions: marketing and innovation. All else is detail." This was the subject of a debate in my class, more than half raising the objection that devil was in the details. I, too, thought one could not reduce a whole business to a single functional unit. But now as I write more about the video games industry, I get a whole new appreciation for that quote.

Drucker did not mean the details were unimportant. What is of the utmost importance, though, is not to let the details run your business. Once the details get in charge, rest assured you are on a spiral of decay and eventual demise, waiting to be dealt the death blow by a competitor who knows what business is all about.

For those of you who are allergic to the word 'marketing' (thanks to Grover and Kermit), let me rephrase the original quote: "Any business enterprise has only two basic functions: creation and delivery of value, and innovation." I like this version better because it shows well that whatever the games industry is currently doing is anything but that. Predictability wins over creativity, and under-delivery has become the norm of the industry.

Even though I am trying to have a different business approach to games in this blog, I've had quite a few people tell me that any business talk is a turn-off to them. Recently I have begun thinking that this might be the root of the problem.

Could it be that in our avoidance of business-related issues (because we are all burnt-out and distrustful), we have been delegating our responsibility over to people who could not have cared less about all the things the industry should stand for? It is very simple: when one refuses to drive, somebody else will get behind the wheel. After that point you will have very little say in where you are going.

Hence the reason I have been going on and on about how internet has changed everything, and how it has reduced the barriers to innovation. But it is not just the internet, of course.

The mentality needs to change too: from passive observation to passionate entrepreneurship.

A brief intermission

2008-09-22T16:32:00.000-07:00

This post was meant to be a comment on a blog written by a friend of mine. Then it became too long to be a comment so I decided to put it up here instead. It is about the paradox of choice: the theory saying that having too much freedom in our lives may be leading to unhappiness and depression.

My friend's article is more about what this means from a marketing point of view, and I left my comments there on that angle. This one here is a more personal comment on the idea.

I think the problem of choice is a good one to have, perhaps even a necessary transition phase in human evolution. If the first amphibian creature back in time got scared by the paralysis of choice and went straight back to the ocean for the safety of the old, we wouldn't exist now. What we need as individuals is not giving up our options. We merely need to redefine our sense of purpose, we need to redefine what really matters in our lives. Without that, there will always be a disconnect between our expectations and the benefits we receive from our choices.

About two years ago my mentor asked me the question, "What is your goal?" It is not an easy question to answer, and certainly not one we readily know. Finding a job? Living in a nice house? Leading a good life? How do you define 'good?' Will you have attained your life's ultimate goal with a house, a car, a job, or anything material at all? It took me quite a few tries to find the answer, and I was very surprised at the time that it did not immediately occur to me. But once I found it, the first decision I made after that brought me here to where I live today, without an ounce of regret despite all the things that were at stake and all the things I left behind.

I know Mr. Schwartz is not necessarily calling for a throwback to some oppressive regime, but I am sure there will be many people reaching the conclusion that less freedom brings more happiness. If any policy makers are reading my blog, know this please: I never asked you to make me happy. That is my job. My responsibility. Your job is to make sure I am educated and informed enough to perform well at that job.

It is informational asymmetry that causes the problem, not freedom of choice.

Internet as a socialist revolution (Part II of Internet, socialism and marketing)

2008-09-22T09:13:00.000-07:00

Is there anyone who has not heard of the article "Is Google making us stupid?" by Nicholas Carr? I read a review of the article by Jill Dahlstrom recently and it partly inspired me to write this series you are reading now. The one part that drew my attention was the claimed economic model of the internet:

"Carr explains how the economic model of the Internet is based on the volume of clicks and page views. ..... New media ads are strategically placed in and around articles, and some are animated so that they draw the eye away from the primary page content. The more we click, the more money Google and other search marketers make."

After reading this I thought, "Is this really all that there is to Internet? Is this what has become of one of the greatest inventions of mankind, just another ad-yard?" Or is it leading us in an entirely new direction that we are just beginning to realize?

As for what direction that might be, Stefan Kolle from Futurelab describes it pretty well in his "ideal" (although he does not necessarily attribute it to internet):

"...a world without the need for advertising. A world where products and services are based on true customer insights and executed in perfection. A world where both customers and employees are so satisfied, motivated, enabled and empowered to spread the gospel that brands don’t have to be an annoyance anymore."

Admittedly, the first time I read it I could not help reacting with skepticism. We have been living with brands and ads for so long that it is really hard to imagine a world without them. Hard but not impossible. Especially when you realize that it is beginning to happen; slowly maybe but it is happening.

The power of pull
If you are sick of me referring to the Mount&Blade example again and again, check out Ideastorm.com from Dell computers. It is a site created specifically for direct communication with the customer. Customers can post ideas and feedback on the site about the products, and other users can promote or demote those ideas. The higher the popularity of the idea, the higher the priority it gets on Dell's list of things to do. Does it sound familiar? It is that dialogue again, between designer and customer, the ultimate disintermediation. It is an early version of a utopia where customers get exactly what they want, and manufacturers know what they should produce.

Now back to Part I: Why push yourself, or your product, or your service on people who don't need them when you can easily find those that do? When they can find you and tell you exactly what they want?

We have nothing to lose but our ads
At the core of the socialist philosophy is the idea that it should be the working class who seizes and owns the means to production. The critical flaw in that ideology (which eventually led to its tragedies) was that nobody questioned how meaningful the production was: i.e. producing widgets endlessly when people were starving.

The Internet has potential to empower the individual (both as a producer and a consumer) in a way that the socialism of old could never imagine to do. It is the means to production, to distribution, to research and development, but the best of all, it is the means to validation (which has always happened to be the strongest argument for free markets of capitalism against state controlled markets of socialism: traffic signals of a healthy economy).

In that regard, what we see might just be the paving of the way to an economic ideology never seen before. Internet is the revolution.

(To be continued in Part III: "But how does this all apply to games?" A brilliant climax - TK Times. Don't miss it!)

Internet, socialism and marketing (video games too) - Part I

2008-09-20T16:44:00.000-07:00

We dislike marketing and marketeers. We may laugh or be impressed with this ad and that, but deep down we do not trust them. Even the marketing professionals, who seem to be passionate about their jobs, are quite cynical when it comes to being on the receiving end. Even as we push our products and services to the masses with marketing (because we all want to get rich), as responsible people we teach our nearest and dearest to be distrustful.

Click on the above picture, and you will see Grover and Kermit (Sesame Street) putting a perfect portrayal of what marketing supposedly stands for in our society: selling things to people who don't need them. If you have read my previous post, you will remember the senior milkman's keen observation to be a good testimony on this fact.

Before you sigh and nod your head in agreement from the vantage point of your moral high ground, take a moment to think if you might be responsible for doing the very same thing. How many of you tried to make yourselves look like the perfect candidate for a job you knew you were ill-suited for, just because you were desperate to get the bills paid? How many of you feigned (or denied) interest in this musician or that ideology just to get in someone's pants? How many of you dressed (packaged) yourselves differently than you normally would, in order to leave a good impression on people (customers) that could have lasting influence (profits) on your lives?

This is why our understanding and practice of marketing is warped. For most people, marketing and advertising are interchangeable terms. We push things at people. This is far from an ideal practice of marketing, which should have been finding the right product/customer for the right customer/product.

Rotten old days
Back in the old days, we could not possibly have been blamed for this. For what choice did we have, if we were not blessed with the good fortunes of being in the same geographical proximity as our perfect customers? If you did not have the perfect product, you made it look like the perfect product as much as possible, for finding instead the perfect customer for your product would be a costly adventure. We considered very little, if at all fathomed, the possibility of pull marketing; simply because as individuals and customers ourselves, we had very little means of pulling.

But things have changed.

(To be continued in: "Internet as a socialist revolution." Coming soon to a blog near you!)

From sad to happy

2008-09-18T16:10:00.000-07:00

The level of quality in your product or service is a direct contributor to sales and profits. This goes without saying. But when it actually needs saying, you know something is definitely wrong with your industry. This is from Michael de Plater, creative director on Ubisoft's forthcoming strategy title EndWar, quoted by Phil Elliott:

"...so there is a relationship between the quality of the games you make and the sales," he said, although he did concede that other factors, such as marketing, were also likely to ultimately influence the sales figures.

In order to convey the ridiculousness that this state of affairs corresponds to, allow me to reconstruct this statement as if it were spoken by some other expert from some other industry:

"Milk bottles that are actually filled with milk tend to sell better in the milk market, compared to those filled with water," the senior milkman said, although he did concede that they were regularly able to sell large quantities of water to consumers, under the guise of milk, thanks to marketing.

You developed what?
Earlier today I was looking at the R&D expenditures of EA and Ubisoft, wondering just how much of that was actually value-added for the gamer. Someone tell me if I am wrong, but I am assuming a large portion of their R&D goes for graphics/physics engines. This is the conclusion one reaches after seeing no major innovation in gaming experience when the total R&D spending of these two companies reach almost $1.5 billion together.

While some people might count the sheer graphical prowess of these game engines as major innovations, the question that stands out in my mind is this: have they run out of all other less costly venues of value innovation?

Some people know the fact to be far from that. In my previous post I gave the Taleworlds example, but there is more. Introversion Software in the UK claim to be the last of the bedroom programmers. I will dare say they are, instead, one of the first of a new generation in gaming.

PC gaming is dead
PC gaming as we knew is dying. Console gaming owes much of its success to the fact that many PC gamers were simply burnt out by the crazy hardware race that made you upgrade - if not buy an entirely new computer - almost every year in order to get the most out of the titles you purchased. When you pay $60 dollars for a console title, on the other hand, you know it will work seamlessly on your machine. You know this will be the case for any title for the entire life span of the console which can be up to four or five years depending on your time of purchase. With the PC, there are no guarantees for tomorrow.

Although many companies are on the transition to the console market these days, their mentalities are still locked on to that arms race. It is as if they have been running for so long that running is all they know now.

Long live PC gaming
The exodus leaves a lot of room, however, for independent developers who are sweeping the remaining venues of innovation left unexplored by the biggies - and they have left a lot in their crazy run.

The immensely positive response shown to games like Mount&Blade, Uplink, Darwinia and others, proves the demand for originality in games. This is a demand that does not need billions of dollars to meet. All it needs is creativity. The internet has helped with the big hurdle of distribution for the indies. For the gamers it might just be the cause of preference over consoles where the only content digitally delivered to your drive is the one that pays the royalty fees. Devs and publishers who can realize their new options and advantages may have a good chance of enjoying a second golden age in PC gaming.

What social media marketing can do for you

2008-09-17T14:56:00.000-07:00

As I was perusing the LinkedIn discussions this morning, I came across a post referring to this blog article by Peter Kim. The small article (articlette?) discusses how the principles of game design may apply in creating engaging social media networks.

Bryan Elliott on LinkedIn was reversing the argument and asking the question what game marketing can learn from other brands in this field. As it happens, I have another suggestion: let's look at what big game marketing can learn from the indies.

Mount & Blade is a video game for the PC, developed by Taleworlds (an independent developer). The original design team consisted of Armağan Yavuz and Ipek Yavuz, husband and wife, with a shoestring dev budget and no advertising. The route they took was to cultivate an active player community and rely on word of mouth advertising. They managed to achieve sales of over 40,000 units and dozens on player created mods for the game before the game came out of beta testing. Recently it has been picked up by the publisher Paradox Interactive.

I think this example leads back to the distinction in the original blog post from Peter Kim. It is questionable how good social media networks are at advertising, particularly in gaming. After all, most of the participants are fans who had already bought your content and I am not sure how much brand loyalty counts for unless you are going for a franchise like Sims. Even considering Mount & Blade, although it is pretty impressive to get that many sales with one's first ever game, I doubt it could generate results impressive enough for blockbuster titles with sales figures measured in million units.

It is, however, an undeniably strong marketing tool.

If you check out the forums on Taleworlds website (and I encourage you to do that) what you would see is not just masses of fans telling how much they love the game. What you see there is a dialogue, where the users are providing constant input into the design process, where the developer actively participates in the discussion (as opposed to PR mediation), and where the new ideas and additions to the game get immediate feedback.

Add to that the brilliant sales model where users can pay for the modest beta price and get all the future updates (including the final version) for free, and you end up with a fanatical following that tells you exactly what they want to see in the game, and exactly what other people like themselves will pay for.

End result = future sales forecast of half a million units under the Paradox banner. For scale, take a look at the top selling PC games. Imagine the dollars went into production, support, and advertising for, let's say, Neverwinter Nights. Now compare that to Mount and Blade, and contemplate the words Return On Investment.

If this is not marketing in its fullest, finest, shiniest glory, I don't know what is.

Just like Peter Kim says, social media marketing is great as long as you remember why you are doing it. Creating buzz for your brand is the least you can do with it, compared to how much you can learn from it.

To boldly go noone knows where

2008-09-16T15:30:00.000-07:00

As I said previously, my goal in this blog is to combine a business perspective with a passion for games. Truth is, though, a year ago from now I only had the latter and not so much of the former. This is why an article by William Vitka, dated 2005, was still news to me when I first read it this year. The title read “In-Game Advertising” and was discussing the trends in this new and exciting marketing frontier. Sitting in class and reading this article three years after its publishing, I thought I must have missed a lot in the meantime.

The perpetually new frontier

Or have I?

Here is a quote from an article by Phil Elliott (Advertiser’s Context, 2008):

“In-game advertising is set to be one of the hottest subjects of 2008 and while most people seem to agree that there's a lot of potential new money to be made for videogames publishers, quite how that will be realised is still debated.”

This debate stems from another important question; what is the most effective way of employing in-game advertising? Much of the research undertaken in this field in the last three years comes from the agencies themselves, and therefore gives cause to skepticism about the true potential of the medium.

Another reason, Elliott proposes, is that the video games industry is moving at an intimidating speed for advertisers, changing at much higher rates than traditional channels such as TV and radio. Even though this makes sense when you compare games to television, the explanation is somewhat less convincing when you hold comparison to a more similar medium. The internet is not so slow moving at all, yet it is already thoroughly infested by all kinds of advertisers.

What is the difference then?

There are opposing forces at play here. On one side companies are trying to avoid the first mover disadvantage by watching the others first and learning from their mistakes before launching their own in-game campaigns. On the other side, there is the pressure of the possibility that your competitor might just get it right before you do. When Nike reaches out to the masses of 18-34 year olds through in-game advertising, how long can Adidas afford to leave them completely unchallenged and unchecked? Or think Coke and Pepsi. Not so surprisingly, the answer is ‘not very long.’ An article on Gamasutra.com ( back in 2006) proves the point perfectly. Traditional brand rivalries are strong propulsion for in-game advertising.

There is no huge difference between general internet advertising and in-game advertising in this regard. The latter is simply at the beginning of its life cycle and is on a very healthy growth rate to maturity in the future. Innovators and early adopters of the medium will eventually provide the critical mass of good and bad examples necessary to make the leap to wide adoption.

The one big difference lies in the structures of the two media. The internet has a great multitude of channels to reach the consumer with advertisements. The conditions are close to perfect competition and the dynamism allows for quick experimentation. This is not so much the case in the video games industry dominated by two big publishers such as EA and Activision, where the number of PC and console titles at one time is limited. Add to that the long (and sometimes unpredictable) development cycles of blockbusters, as well as the complexity of advertiser-agency-publisher-developer relations in developing of advertisement capabilities. Looking from that perspective, advertising in big PC and console titles may be more similar to ads in movies.

In-game advertising is not limited to the cutting edge of hi-tech gaming, however. Research from eMarketer shows ad spending in web based games has a growth rate of nearly 40%, compared to 30% in PC and consoles, between the years 2007 and 2008. This is more in line with the “Do It Wrong Quickly” philosophy of internet marketing, for the flexibility the web provides.

The suggested offset to this lack of flexibility in big titles is the use of dynamic ads, placed on billboards or other in-game surfaces, which can be changed in real-time. In theory this sounds pretty sweet. In practice, however, what you can change in real-time is the content of your advertisement. The context (the game in which it appears and the method of interaction) remains largely the same. Compared to web advertising where you have greater control over both content and context, there is still a considerable disadvantage.

Frag or Coke?

The original article from Vitka does not mention the issue of metrics, but a good deal of the debate boils down to that point. Again, Elliott explains the situation:

“…the three big sellers of aggregated in-game ad space don't even have the same measure for what constitutes an 'impression' (the oft-used number on which the advertiser gets billed).”

The problem with in-game billboard ads is that it is almost impossible to identify and formulate the instances where the interaction with the user is meaningful and the message is properly delivered. While the ad may show up on your screen when you are playing a game, your attention could be highly focused on anything (such as the enemies trying to kill you) but the ad at that specific time. A good study on the issue is the report on advertising effectiveness in ‘Battlefield 2142’ (Mindshare, 2007). It seems a big challenge for the sector will be inventing new ways of creating dynamic ad space that allows for meaningful, measurable, in-depth interactions with the brand that is being advertised.

Only it's not always a pleasant walk in the battlefield

This argument then leads to the two big components of in-game advertising: gamers and developers. The sentiment has pretty much been the same in the two articles with three years between them; if the consumer will not be getting anything out of this deal, then nobody will. The acceptance of advertising in games depends largely on winning over the gamer and operating in a way that will not disturb their entertainment experience. This is very critical considering how outspoken the gaming community can be. An aggressive strategy could cost both the publisher and the advertiser dearly.

I would suggest that the best way to explore new techniques and ways of non-intrusive in-game advertising lies in collaboration with developers. In that respect, the exact size of the cut that the devs will get out of this trend probably depends largely on how much of this opportunity they can realize and incorporate into their business models.

Selling? Game? What?

2008-09-03T22:59:00.000-07:00

With this first post, I will simply try to explain the purpose of this blog and what one might expect to see within.

My main goal here is bringing together two big interests of mine: computer games and marketing. Oddly enough, I am an expert neither in one nor the other. Why then?

Why computer games?
Because they are fun and exciting. In the way that movies were exciting when cinema emerged. In the way that radio was exciting in the early days of wireless broadcasting. One might go on with this list, adding things like the classical theatre or even the advent of writing.

Simply put, video games are a new and revolutionary medium for artistic expression and storytelling, if not the most advanced one at our disposal. The potential for immersion, expression and interaction is almost limitless. Yet if so, why are we not already seeing content that rivals classical literary works? Why is it not dubbed the 8th Art (the number is negotiable) yet? How come one of the biggest companies in the industry owes its success to publishing the same sports games over and over again every year? How did we lose the values of originality and creativity, and ended up with 'tried and beaten to death formulas' like RTS, FPS, and whathaveyou?

Why marketing?
Because things are not as limitless as they seem. A video game is a commercial product like any other. It needs people to use it, play it. It has to meet a need, and it has to find the right person with the right need. Otherwise? It is meaningless. It does not sell and it does not get played. It gives its developers little reason and provides even less means to achieve consistency in creation of great new works.

Thus the future of the medium is largely determined by what is commercially successful. This is why we have been playing the endless iterations of the same soccer title for the last decade. Because it has found its niche, and its commercial fortunes are, more or less, predictable and safe for the business-mind.

On the other side of the spectrum we see games, developed with amazing talent and production value, which somehow fail to achieve a commercial success. The game 'Planescape: Torment' is probably the best example to this. Sadly, each consecutive failure of originality (aided by each consecutive commercial success of the tried and beaten-to-death) delays the medium from achieving its true potential.

So?
So it is my vision and goal to find the grounds where profitability and quality (with originality and creativity being its primary metrics) do not have to be competing goals. As a MBA candidate and gamer who is trying to get into the industry, my goal in this blog is to explore the dynamics between the content and business sides of the medium. Hopefully my writings will help me (and possibly others) in framing, analyzing and solving this challenge.

In short:
The Selling Game - How to sell games that deserve to be played.