Last week in Istanbul, Google and Deconstructor of Fun brought together a thousand-strong group of high-level mobile games execs to talk about the future of the business.
You can find edited highlights of each talk below, and videos of each session – just hit play to start watching.
State of the mobile game industry
Eric Kress, Gossamer Consulting
Deconstructor of Fun’s “chief outrage officer” Eric Kress was up first to offer what he called a “pragmatic view of what’s going on in the market.”
His insights were based on US data as a proxy for the western market, and focused on platform privacy, or the “Apple global mobile game recession”. Kress said that the current’s market’s woes were “all Apple’s fault”.
“We are in a scary place,” he said, outlining how the market had been growing year-on-year at around 25%, so being down 10% in the last twelve months represents a 35% delta.
Running through the market by genre, Kress noted that King has done quite well, but other genres had suffered badly, with strategy, RPG, match puzzle and casino games all down double digits. “Shooters got creamed”, too, he said – down 33%.
Kress predicted another two years of western market decline at around 5-10%. He again placed the blame on Apple’s push into privacy, calling it “hamfisted” and a “mess”.
“They don’t care about gamers, they don’t care about gaming, and they don’t care about publishers. They care about themselves,” he said.
Kress stated that as the market shifts into casual games it would be really tough to launch and scale new strategy and casino games, but cited Marvel Snap, Diablo Immortal and Survivor.io as great examples of what could work in the market going forward.
Without a big IP to rely on, he cited Survivor.io as particularly notable through its hypercasual-style play that adds in more depth over time.
So how should publishers think about launching new games right now? Kress ran through some suggestions:
- Build your game around a big IP or license
- Create games with mass market gameplay that reveal depth further in
- Find audiences you can reach cheaply and build games for that audience
- Explore alternative distribution strategies and going off-platform like Scopely and Playtika
- Think about going cross-platform into PC where it makes sense
Summing up, he added: “We are in a sea change in this industry. Apple has really screwed us over in a really big way and everyone is responding. Things are going to get worse before they get better.”
He ended on a more positive note: “This is an opportunity for you guys to figure out how best to market new games, to take all these challenges that we see and come up with something new. You guys will be likely more nimble than than EA and these other publishers out there.”
Gaming: an ever-changing landscape
Alpagut Cilingir, director retail & apps, startups and gaming, Google
Google exec Cilingir set the scene by offering a couple of ways mobile gaming is being squeezed by increased competition for screen time, inflation and, of course, privacy change, which Cilingir described as a “tectonic shift in the market”.
Looking to the future, Cilingir noted an increased interest in subscription gaming services like Netflix and Google Play Pass, but also acknowledged that launching new games is tougher than ever, and urged game-makers to think more creatively than ever before when going to market.
He said the number of active players is still rising and those players are downloading more, so there’s headroom for growth. Cilingir offered three ways to get through the current situation:
“Don’t be stuck in a single genre,” he said, noting shifting trends in player behaviour that have seen a rise in niches like MOBAs, hack and slash, auto chess, melee arena and soccer management games. There have been declines in team battlers, 4x strategy, action RPG/MMOs, shooters and builders, he said.
Building a brand
Cilingir used League of Legends and Genshin Impact as examples of brands that have resonated outside games, and stressed that community-building has never been more important as it lowers your UA cost. He stressed that games should hold true to the brand’s values, citing Star Wars: Galaxy of Heroes as a perfect product-market fit.
Diversify revenue model
Cilingir urged game-makers with games skewed heavily toward either ad or IAP-based monetisation to balance their revenue mix.
He concluded: “Nothing lasts forever – growth doesn’t last forever, but neither does decline. Those who take action today will be the ones benefitting the most in the near future.”
Panel: Recession vs game industry
Host: Laura Taranto, Big Fish
Chris Petrovic, FunPlus
Dara Leung, The Raine Group
Micha Katz, Aream
FunPlus’ Petrovic began the discussion of the market’s struggles by suggesting that some folks had got used to rampant growth and suffered from “a little bit of complacency”.
“What has worked in the past might not work in the future,” he said, and urged the audience to hold their nerve and stay in mobile to continue to play a role in what is still the largest part of a growing games market.
He said that for FunPlus, IP creation is at the centre of success and that the next Marvel or Star Wars had a chance of coming from gaming.
He also said there are opportunities in going cross-platform and direct billing. “Consumers are increasingly expecting to have an ‘anytime, anywhere’ experience” like they do with other mediums, he continued, and urged marketers to move away from UA-based performance marketing and into integrated and omni-channel campaigns.
Aream’s Micha Katz agreed that there was a little bit of complacency out there after ten years of rapid growth. Katz said that the business must get “back to basics” and forge a healthier market away from its reliance on UA.
Katz went on to talk around the state of M&A and noted that where in previous years 80-85% of acquirers were publicly listed companies, in the last year that figure was around 20%, with many private buyers coming into play.
The Raine Group’s Leung said that “the last two years of go-go valuations are over”. Capital is more expensive and more sellers are in the market, so big companies are refocusing and shedding non-core and less profitable parts of their business.
Leung also said since the market has turned investors are more inclined to back their winners harder than investing in riskier new outfits.
She added that ‘take privates’ and corporate carve-outs will likely become more common in the near-term, and both Leung and Katz cited deals like Moon Active’s acquisition of Zen Match as a sign of things to come. M&A could now also be considered as a user acquisition tactic as well, they said.
Petrovic rounded out the panel by adding that Turkish companies must start to think more globally, using Gram Games’ international offices as a good example.
He added that he loved that “passion and competition” in Turkey – but noted that he struggles to get two founders together over dinner. The time has come to embrace ‘coop-etition’ and work together a little more, he said.
Navigating platform privacy changes
Josh Willner, global product lead, app ads privacy & measurement, Google
Willner’s talk outlined a complex marketing landscape and ran through some pointers on what Google is doing to help developers navigate the space.
He stressed that Google’s current targeting products aren’t changing right now, but folks should sign up for its latest updates and also participate in shaping the future through dialogue with adtech partners.
He also ran through four best practices for better iOS campaign measurements:
- Integrate your app with SKAdNetwork for install measurement
- Set up your SKAdNetwork conversion value schema for post-install event management
- Ensure your conversion value schema is inclusive of your biddable events
- Consolidate your iOS app install campaigns under the 8 campaign limit
And there were three best practices for better campaign optimisation:
- Evaluate if the ATT prompt is right for your app
- Activate on-device conversion measurement
- Ensure full creative diversity in your iOS app campaigns
ATT did not kill mobile gaming: UA, game mechanics and creatives
Matej Lancaric, user acquisition and marketing consultant
Taking the stage with a phenomenal Lenny Kravitz-inspired scarf and a positive outlook – or “Kumbaya shit” in Lancaric’s words – the consultant offered tips and context for marketers working with iOS14.
He offered a loose recommendation for geo targeting that buckets territories into tiers:
Tier 1: US, UK, CA, DE, FR, AU, KR, JP, CH
Tier 2: DK, FL, NO, SE, NL, ES, IT, HK, SG, NZ
Tier 3: PL, CZ, SK, BE, AT, IE, TR, UAE, SA, TW, TH, BG, ROW
…but noted this bracketing should not be copied wholesale and adapted depending on your game.
There were also tips and tricks per platform for those managing creatives through Google, Facebook and TikTok, and some suggestions around optimising your ATT prompt.
He rounded out the talk by advising marketers to:
– Consolidate your campaigns. Use geo buckets and don’t run 20 campaigns with low budgets, consider running four strong campaigns with higher budgets so you can get more data points
– Test creatives on Android and take those learnings and run campaigns on iOS afterwards
Why do some game companies succeed, whereas others fail?
Kim Nordstrom, advisor
Nordstrom’s talk was aimed at founders and leaders building company culture. He described culture as “patterns of behaviour over time – something that regularly and repeatedly happens in your environment, in your team in your company”.
He also referenced ‘Auftragstaktik’, or military tactics in which the emphasis is placed on the outcomes, not the methodology.
He also urged founders to acknowledge that as their company scales, teams must change the way they work.
Business leaders should calculate the time it takes for the company culture to embed itself in a new team member, and scale according to that “culture-transfer rate”.
“The real job of the CEO is to constantly preach about culture,” he concluded.
Using turbulent times as an opportunity
Host: Joakim Achren, Investor
Sergey Dymshits, CMO Plarium
Roman Polyak, CBDO, My.games
Omer Inonu, CEO, Peak Games
All parts of your business from product and marketing must be more harmonious than ever to tackle the current market, began Peak CEO Omer Inonu. Plarium CMO Sergey Dymshits and My.games CBDO Roman Polyak agreed, and suggested that with less reliance on ad tech, today’s opportunity is in brand-building and more traditional marketing.
On the subject of launching new games, Plarium’s Dymshits said strategy, social casino and RPG games were in a challenging spot, and that there will be an increasing ‘hybridisation’ of different genres. Cross-platform is becoming more important too, he said.
Peak Games boss Inonu said that Apple should help developers more by clarifying its privacy policies further, and that Google’s approach seemed to be better thought out.
Plarium’s Dymshits believes the 30% platform cut is still too high, and it will continue to drive developers off-platform: “When margins are tight that 30% is the difference between success and failure,” he said.
Inonu, Polyak and Dymshits agreed that developers should also explore subscription products and leveraging IP outside of games, as well as re-investing in brand marketing and original game design.
Keys to improve retention
Javier Barnes, senior product manager, game economy & F2P monetisation specialist
Barnes began by stating that retention is more important than ever, because it is tougher to replace your highest quality players if they churn out.
Fun generates retention, he said, adding that game designers should think of their games as becoming a daily player habit. He then broke down the phases of retention:
Short term retention (D1-3)
This begins with “D0” – install sizes, upfront downloads, unskippable intros and long loading times are all possible churn points, and are to be avoided.
Gameplay should be easy to learn, with intuitive rules, clear UI and familiar inputs. Game complexity should be spread through the onboarding, and players won’t come back if the game gets predictable and monotonous, said Barnes.
Early sessions should end with the players wanting more – not by blocking play through an energy system. Incentivise players to come back, and remember that long, fully dedicated play sessions are rare in mobile, so keep your core loop snappy.
Designers should highlight game progression and grant it early, as well as providing customisation options and meaningful choices in the early play. Anything that makes a player feel a sense of ownership is good.
Finally, to nail that early retention:
– Playtest often and watch real players
– Analyse and improve early game funnels
– Present the onboarding process as a thing to be completed – people like ticking things off
Mid-term retention (D7-30)
You need to have enough content to sustain the most engaged players, Barnes said: do not design content for the ‘average’ player.
Then, think about play diversity, mastery, depth and social features that make the game even stickier. Clans, chat, friends, trading and guild adoption should be surfaced early in this phase.
Long term retention (D90+)
If you want players to come back every day, you need to provide something new every day – but vary the intensity of those live ops so players don’t get fatigued.
Add features that foster completionism or social cooperation for the most engaged players, and reawaken churned users with battle passes that encourage players to come back and see what’s new, then reward them with ‘welcome back’ gifts.
Finally, Barnes stressed the importance of community building, and using channels like Discord to understand what your most engaged players want.
Build your sustainable growth strategy with Google
Katie Funk, global product lead, gaming, Google
Pasha Nahass, group product manager, Google
Varun Khanna, global product lead, mobile app ads, Google
Funk began by running through ways to ‘maximise the launch moment’, and recommended Google’s app campaigns for ‘pre-reg 2.0’. With Google Play Auto Install, players automatically download the game at launch, and there are more ‘launch-specific experiments’ features to come, too.
Talking through how to scale your game at launch, Funk ran through bidding types at your disposal and namechecked the growing trend for hybrid monetisation, noting that specific Google tools for games that blend IAP and ad monetisation are coming soon.
Nahass then ran through Google’s tools for engagement and re-targeting. There was also a peek at auto-generated interactive and character-based ad units, and also some ad formats created automatically from a toolkit of game assets.
Khanna rounded out the talk with some tips on managing ad creatives, including some AI-powered campaigns that can take the shape of text, image, video and HTML5 ads.
He finished off by reminding marketers to refresh their ads no more than every quarter, removing low-performing assets. Video bumpers are also now an option.
What is the next big thing?
Host: Anton Backman, Play Ventures
Maya Hofree, Product Madness, VP new games
Timur Haussila, Product lead, Supercell
Richard Kim, Galaxy Interactive
Capping off the day, this panel looked at balancing existing games and launching new ones, consolidation and emerging trends.
Product Madness’ Hofree stressed that it is only because the firm has a strong portfolio that it is able to create new games, so game-makers should ensure they’re leveraging prior knowledge and strengths. It’s a big mistake to ignore the players you know already and the community you’re speaking to every day through your existing games, she said.
Supercell’s Haussila spoke about the process that goes into making a new game at the Clash of Clans maker. He said that the team has complete freedom to create what they want, but new games are often driven by one team member who has an idea they really believe in, who then builds a team around them.
In response to Playtika’s assertion that it won’t be launching any new games, Supercell’s Haussila said: “We’ve never had more games in development that we do today”. Hofree said it’s a different story for Product Madness too, which is working on several new games and new launches right now.
Investor Richard Kim sees a funding gap incoming and more consolidation as a result of the difficulties around launching new games.
Haussila added that investments Supercell ID, its own game engines, social graph and data tools will hopefully spark innovation and new ideas. He also emphasised the need for game-makers to be present in online communities. “You cannot just focus on the game alone these days,” he said.
Offering the investor view, Kim said that he actually likes to see focus on one platform before steady expansion across others. He is also still a believer in web3, but would like to see more game developers using blockchain tech to offer something only enabled by web3 technology. He added that a lot of the funding that went into PVE or play-to-earn games was flawed.
Hofree said that she was excited by AI for prototyping, brainstorming and personalising the experience for every player, and Haussila said he was interested in using AI tools to speed up some developer processes.
Ending on a prediction each, Haussila said to look out for developers experimenting with games in mobile browsers. Hofree added that smarter AI-based bots could make multiplayer games feel more alive, and Kim said he was interested in players making investor-style interactions and taking ‘active risk positions’ in web3 games and virtual worlds.