RELEASING MOBILE F2P HITS OVER AND OVER

Why some companies are able to consistently release successful F2P mobile games, while other seem unable to score multiple hits?

It’s well known that nowadays every single developer struggles to launch new hits. But still, some companies such as Playrix or Scopely seem to have a greater success ratio than others. Why?

I raised this question a few days ago at LinkedIn. The discussion helped me develop my random ideas into this article. So I’d like to thank Evangelos Leivaditis, Sagar Joshi, Yasser Bushara, and my man in the North Tiago Tex for their contribution.

Of course, there is not a single thing which completely explains what sets apart serial hit launchers from one-hit wonders. The difference is a combination of many factors. Here we listed some of them:

#1: SHOOT MULTIPLE TIMES TO THE SAME SPOT

Several of the companies that we’d consider serial hit launchers have achieved that status by finding successful formula, and repeat it several times:

  • Excluding Township, all Playrix releases are puzzle games, particularly in the Match-3 category. They have little variation when it comes to target audience.

    Most of the titles share similar UX, art style and core mechanics (the decoration meta), which agilizes the production and makes easier the reengagement of casual audience, which by definition has difficulty building new habits.

  • Scopely titles are classified either as Collection RPG Strategy oriented to mid-hardcore audience, or casual puzzle. It’s a great achievement IMO.

    The recurrent usage of IPs optimizes the value of their licensing department and generates brand reputation, gathering more trust from IP holders and fostering better future deals.
    After all, if you were the holder of an powerful IP, who would you want to develop your mobile game: Scopely or a company with no history of working successfully with external IPs?

  • Even if lately it seems to have fallen a bit out of grace, Supercell most recent hits Clash Royale and Brawl Stars focus on a similar kind of experience (real time PVP with strong focus on competition, eSports flair…) and target similar demographics.

    Which means a lot of project synergy in terms of technology, design methodologies and marketing (brand recognition, etc), as well as feature insights that they can share (Battle Pass, Trophy Road…).

None of the companies above are pursuing being the masters of many trades. They have recognized how difficult is to create a top quality product on any category. And therefore have chosen to master a specific one.

Focusing on a specific genre, target audience, game experience or technology means a lot of advantages that ultimately improves the chances of getting a hit. Among them are:

  • Faster progression towards quality.
    By iterating over an already mastered area, new projects get a kickstart of know-how from the previous hit, which will dramatically accelerate the prototype stage.

    On top of that, they will have access to the target audience of the previous game, which means being able to gather feedback from engaged players, having a strong list of suggestions and building more reliable player personas.

    New projects will have a clear benchmark for KPIs and be aware of any ongoing market fluctuation, meaning that they’ll detect faster where there is a problem or opportunity, and where they should iterate.

    Even if there’s no successful game behind, iterating over a specific genre still means faster gathering of knowledge, since development times will shorten and insights can be shared among different projects.

  • Increased project synergy.
    The more similar games are, the easier it will be to share more between them:
    For example, if games share the engine and technology it means cheaper costs per project, and more people can work on thedevelopment, optimizing quality at the cost of versatility.

    It also means that most processes and methodologies that your company has on live games will work on new games too, and that insights will be shareable.

    On the contrary, if your new games go for a completely new genre and audience (let’s say, you’re doing a hardcore MOBA while your company was traditionally focused on Casual Tycoon games), you’re going to have to completely redesign the creation process, which will take ages. And insights from your past experience will most likely not work.

  • Better recruitment and worker training.
    Focusing over a specific genre or target audience will accelerate the training of your personnel, since newcomers will be able to pass through the live games and get frontline experience. This experience will not be as valuable if the new game has nothing to do with the previous one.

    It will also allow your Recruiters to focus on a specific profile of professional and attract workers that have a sincere interest on the genre.
Most devs and creative teams from Riot Games latest releases went through League of Legends first.
(All are competitive PVP and target the similar audience space: the genetics of the company).
  • Generates incremental value of Failure. 
    Supercell taught us all that to get hits you need to kill games, and most likely any new game development will end up being canned or failing.
    But if a failed project doesn’t generate valuable knowledge for the next one, then it hasn’t improved your chances of success. It’s just wasted money.

    A lot of companies and teams switch to something completely different after obtaining mediocre results on their first attempt. That doesn’t make sense. At that point they’re better suited to succeed at the genre they just tried.

    By iterating on the same area, Playrix, Scopely and many others make sure that any failure contributes positively to a future attempt. From a list of points to rethink or avoid to art assets that can be reused.

THEN WHY COMPANIES TEND TO OVERDIVERSIFY?

The benefits of a laser-focused portfolio strategy are quite clear. And yet, most companies engage on out-of-scope diversification, which diminishes their dominance over an area and diverts their efforts.
Key reasons for this strategic mistake are:

  • They overvalue wide diversification. A rule of thumb on any business is that having a well diversified portfolio means that your company is healthier. You don’t have all your eggs on the same basket, and you’re expanding. Growing.
    But this is not necessarily true on games, specially in mobile, where top grossing positions are a winner takes it all scenario.

    Even the most successful mobile games companies rely on a small catalog of extremely profitable games. The strategy of wide roster of mediocre performance games means low profitability, potentially none.

    By following a strategy that allegedly decreases risk, companies are taking the path that increases the risk that everything they release fails, achieving no growth.

  • They undervalue quality. It wasn’t so long ago that mobile gaming was an extremely blue ocean. This meant that many games (some of which now are household names) had terrible quality, or were low originality scaled down copies of games that existed in PC or consoles. And yet, they became extremely successful.

    As a consequence, there’s a lot of companies that have imprinted on their genetics that success is easy to achieve on the mobile space, and you just need to patch something together to make a fast buck. But this is not the case anymore.

    Nowadays mobile gaming is the most competitive digital entertainment business space. The standard of quality has skyrocketed, sometimes in ways that are too subtle for people that isn’t extremely engaged on the product to detect, and which may not appear in a superficial analysis.

    This means that many companies tend to overestimate their ability to create a game with similar or superior quality to the genre leaders. The reality is that this very challenging.
    And that without a significant improvement over what they already had, players will prefer the products and brands that they are already familiar with.
Someone could think that building a better soccer manager than Top Eleven is easy, but that person would likely be unaware of its wonderfully complex player interactions and subtleties of stats and economy…
  • They overestimate cannibalization. A recurrent argument is that by investing too much a specific area, similar products will cannibalize each other (increasing CPIs, etc). But this is a misguided approach.

    In nowadays ultra competitive mobile enviroment, if there’s something that works, either you create more of that or someone else will. Any blue ocean will turn red very fast, and by that point you want to have several games well positioned there.

    It’s impossible to protect a market space. Non-cannibalization mindset will open the possibility for competitors to release copycat products and unavoidably generate the cannibalization effects that the company wanted to prevent.
    And since the cannibalization effects are unavoidable, better to cannibalize yourself than being eaten by a competitor.
Any successful business formula you find will create a gold rush, and soon there will be many prospectors releasing similar games, until the market space is depleted. Cannibalization is unavoidable.

WHAT ABOUT DIVERSIFICATION?

Before starting to pump out reskins of your latest hit, note that I am not saying that companies should avoid diversification, but rather that what companies commonly consider diversification is over-diversification (targetting different genres or audiences).

What I am advocating is that serial hit launchers manage carefully their portfolio diversification by creating products that tackle the same opportunity (similar audience and genre) and maximize their strengths (technology, artstyle, insights…), but are different enough to reinforce the company position and reengage players.

A couple of examples of this deadzone (similar genre, but not enough): Asphalt Overdrive is an endless runner aiming to create a car racing game for casual players. Blades of Brim is an endless runner for hardcore players. They were similar to the main hit, but not enough.

Lack of diversification actually generates a risky situation, by increasing the probability that a competitor disrupts a market saturated by copycats.

On paper, King has quite a diverse portfolio, but if we check each game we see that they had little innovative value between each other, which allowed competitors like Playrix to grow under their nose and eventually steal their crown.
I doubt that any competitor wanting to repeat the feat would have it easy.

#2: ABILITY TO GET LOW UA COSTS

In order for a game to be able to become a hit, it needs to generate enough profitability from players to allow to purchase new players and scalate the size of its business (user LTV vs UA costs).
This means that games which have expensive user acquisition costs will put more pressure on their monetization systems in order to achieve a fast return of investment.

Nevertheless, achieving lower UA costs might be a requisite for success, but without other elements in place it’s not enough to make a game a hit.
Every single company today is looking forward to have low UA costs on its games, so I don’t this is the key difference that separates serial hitters from the rest. It’s only a requisite for success.

Nevertheless, serial hit launchers have mastered at least one effective way to lower UA costs, which they use repeatedly in their projects. Examples of these strategies are:

  • The usage of well known IPs to boost organic downloads and ad effectivity.
    This is Scopely territory, a formula well proven to work by the launches of The Walking Dead: Road to Survival, Star Trek: Fleet Command, Looney Tunes: World of Mayhem, YAHTZEE with Buddies and many others.
  • Targetting multiple times the same genre or audience, aiming to capture churned users from the previous hit, and increasing overall brand recognition (Supercell).
  • Running aggressive advertising campaigns, often employing out-of-the-box creativity that uses fake ads and controversy to increase their clickbait effect. Playrix was the trendsetter of doing this kind of unorthodox marketing with their titles. Homescapes is a great and hilarious example:
Portraying the characters of a friendly match-3 game being tortured in weird BDSM scenarios…?
Someone at the marketing department of Playrix is either a genious or insane. Maybe both.

#3: CAREFUL EXPANSION (OF TEAMS & STUDIOS)

Lately, I’ve heard the argument that getting a hit is mainly a matter of quantity.
According to this POV, the best way to improve the chances of success product is to increase the amount of attempts. I consider that this is naïve.

A common reasoning to support having many teams in paralel is the example of Supercell, which have famously explained that in order to obtain their hits they’ve killed a lot of games.
While I don’t doubt that their strategy is valid, I’m also positive that their idea is to repeatedly invest in teams that are promising, and nurture them to grow as an excellent team. If it was just about killing stuff, they surely have enough money to be developing (and killing) twice or thrice the amount of games.

In my experience, when companies focus exclusively on increasing the amount of development teams and development studios, disregarding other considerations, they are making several mistakes:

  • Separating their best talent among multiple projects, damaging the success ratio of each of them in a way that isn’t compensated by the increment in attempts.

    By choosing to keep a limited amount of teams instead, companies would have it easier to generate teams composed exclusively by top performers, increasing the chance of generating high quality products.
  • Increasing your logistic costs and diverting thinking power management (of multiple teams or studios). This moves effort away from making games, and redirects it towards an expansion which doesn’t necessarily mean an increment on revenue or profitability.
  • Limiting the amount of resources available per team and studio (budget, headcount…), potentially below the amount necessary to deliver a product with enough quality.
    This unavoidably forces the team to choose genres and approaches that are achievable with those limited resources available, rather than taking the decisions that are optimal for the game.

    And ultimately, this limitation of resources ends up generating a situation where teams and studios of the same company start to compete for resources and allocation, which kills cooperation and synergy.

CONCLUSION

It would be naïve to look the current rising stars of the mobile gaming industry (like Scopely and Playrix) and say that their reign will last forever. Back on the day it also seemed that the dominance of Supercell and King was unstoppable, and yet eventually the market catched up.

Nevertheless, I think that both Scopely and Playrix are doing a great job so far at keeping momentum by avoiding to pursue paths that ultimately were liabilities for the previous rising stars:

  • Maximizing the investment on their current area of operations.
  • Diversifying within their area of expertise, instead of boldly defying genre boundaries.
  • Keeping company expansion (headcount, studios…) under control.

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