Marketing & Entrepreneurship. #3. Meet (some of) your markets Niels Monshouwer

Marketing & Entrepreneurship #3. Meet (some of) your markets Niels Monshouwer

§  Marketing/markets for games/gaming §  (sorry, no interaction design) §  A basic analysis of big games markets (console, PC/Mac, handheld, mobile) and big market trends

•  What we know: (some) games markets in figures •  What we know: games markets NL •  Trends in entertainment games •  Trends in applied games •  General Trends

§  What do we know about the size of the games industry, and how do we know it? §  ‘Market research companies’

§  Worldwide revenue of total games industry (Newzoo): 75,5 billion USD (2014)

(Gross  Na)onal  product  of  countries  2011)  

§  Worldwide revenue of total games industry (Newzoo): 75,5 billion USD (2014) §  Prediction 1 (Gartner): 111 billion USD in 2015, ‘mobile and console sales’ are boosters. §  Prediction 2 (DFC Intelligence): 100 billion USD in ‘software sales’ by 2018 (from 64). §  Prediction 3 (DFC Intelligence): PC market 2014 : > 25 billion USD revenu (first time). ‘Core gamers spend more on games than ever before’

§  Prediction 4 (PWC): Mobile market > 15 billion USD in 2018 (from 7 billion in 2013)

§  Prediction 4 (PWC): Mobile market > 15 billion USD in 2018 (from 7 billion in 2013) §  Prediction 5 (DFC Intelligence): Mobile market > 29 billion USD in 2018 (from 11 billion in 2013) •  Console industry (Gartner): 44 billion USD (2013) •  Handheld industry (Gartner): 15 billion USD (2013)

§  Worldwide revenue of total games industry (Newzoo): 75,5 billion USD (2014) §  But….

 =  91  billion  USD  (>  Newzoo’s  market  predic)on,  75,5)      

§  Worldwide revenue (Newzoo): 75,5 billion USD in 2014 §  ‘Our’ market forecast: 91 billion USD in 2014 §  But: Gartners’ forecast: 101,6 billion USD in 2014

§  Gartners’ forecast: 101,6 billion USD in 2014

•  Recap: •  Figures for the international games industry vary wildly – between 75,5 and 110 billion in gross revenue. •  The numbers are invariably high – often comparable with figures on the film industry (88 billion USD gross revenue) •  All market predictions foresee a future growth of 9-11 percent per annum.

§  There’s a lot we DON’T know!

§  Question: is there a ‘Dutch games/gaming market?’ §  Yes: in retail, localised App Stores, with Xbox One §  No: part of ‘Europe’, ‘Western Europe’

§  Size? §  2012 (PWC ‘global media outlook’): Dutch gaming market = 703 million Euro. §  ‘2016: 724 million Euro’ §  Want to know more?

§  …so let’s talk a bit about the Dutch gaming ….

•  Size of total revenue: (Games monitor 2012): 150 – 225 million Euro. •  (worldwide: 75,5 billion USD = 58,5 billion Euro)

•  (Games monitor 2012): 150 – 225 million Euro revenue. •  Well-connected and informal infrastructure •  Growing connectivity between schools and working field •  High quality training •  Good conditions for startups through networks, incubators, seed funding et cetera. •  A growing number of funds for games studio’s

§  ‘Approximately half of the revenue comes from applied/serious gaming’. §  B2B market

•  Ca. 330 game companies •  But what is a game company?

•  Ca. 330 game companies •  Ca. 3000 people employed •  Many small firms (indies or applied) making games •  ’70% of Dutch firms has a maximum of five people in it’ •  ’Only ten firms have more than 50 staff’

§  Trends? Markets? §  Two questions: §  1. “What are the market trends that are important for your business? ”  §  2. “What are you going to do with that knowledge?”

•  • 

•  •  • 

Trends: console (Xbox360/One, PS3/4, Wii/Wii U) Next gen consoles need to prove themselves in their second and third years. (in terms of hardware, software and service sales) (Console) games are part of a wider ‘entertainment-hub’ strategy. Growing interconnectivity with devices other than console (‘second screen gaming’) (PS Mobile, MS Smart Glass) Constant reflex to integrate promising or succesful technologies. (PS Move, Amiibo, Project Morpheus)

•  Trends: PC/Mac gaming •  Firm comeback through digital distribution •  Dutch game industry gains momentum through Steam. •  Steam is finding its way to TV (2015)

§  BUT: Steam publishes more and more games….

§  Trends: Mobile §  1,75 Billion smartphones worldwide, 195 million tablets

§  Stellar rise of a new gaming segment •  Digital distribution (first App Store july 2008) •  The rise and rise of free2play •  Touch interface well suited for gaming

§  Opkomst F2P (ook buiten mobile) §  Android expands through ‘micro consoles’ (Ouya, GameStick, GamePro) -> TV! §  Virtual Reality (Oculus, Morpheus, Hololens, Cardboard) §  Cloud gaming §  Trends: Handheld (Ninendo DS, 3DS, PS Vita, PSP) §  Surprisingly stable market (vs mobile)

§  Second screen (Vita, Tablet, …) §  The ‘democratisation of game design’ gives us new perspectives on games and game design. §  ‘Game analytics’ will continue to influence both game design and games marketing

§  GDC Cijfers over aantallen downloads voor (Indie) games §  Mike Rose - TinyBuild (former Gamasutra) §  Geen F2P games

Wii U eshop §  Installed base wereldwijd: 9.2 miljoen §  Low end games (games die minder goed zijn, die alleen op Wii U uitkomen en nauwelijks marketing hebben): 300 – 1.000 stuks §  Mid end games (multi platform games met enige marketing): 1.000 -10.000 stuks §  High end games (games die op andere platforms ook al succesvol zijn): 10.000 – 60.000 stuks §  Opmerkingen van Rose: Als je gefeatured wordt kan je bij launch goed sales halen, maar na de launch zakt de verkoop snel in.

3DS eshop §  Installed base wereldwijd: 50.41 miljoen §  Low end games: 1.000 – 5.000 stuks §  Mid end games: 5.000 -50.000 stuks §  High end games: 50.000 – 200.000 stuks §  Opmerkingen van Rose: Er zijn vorig jaar ongeveer 15 indiegames uitgekomen op dit platform. Er is een langere sales trail dan op de Wii U. Japanse versies verkopen beter dan de meeste developers verwachtten. Het porten naar de 3DS is duur.

PC (Steam) §  Meer dan 125 miljoen actieve accounts §  Low end games: 1.000 – 10.000 stuks §  Mid end games: 10.000 -100.000 stuks §  High end games: 100.000 – 3.000.000 stuks §  Opmerkingen van Rose: Er staan rond de 4.500 games op Steam en dit jaar komen er zo’n 2.500 bij dat zijn er ongeveer zeven per dag. Alles met Zombies werkt. Er zijn veel games, maar de kansen zijn groot. Je kunt gebundeld worden en je kan je game in early access uitbrengen. Bundles (zoals de Humble bundle) vormen tot tien procent van je sales.

Mobiel §  Er zijn 800 miljoen iOS users, waarvan er 130 miljoen het afgelopen jaar zijn bijgekomen. §  Low end games: 0 – 2.000 stuks §  Mid end games: 2.000 -30.000 stuks §  High end games (een grote push van Apple&Google): 30.000 – 2.500.000 stuks §  Opmerkingen van Rose: Er kwamen in 2014 iedere dag 500 nieuwe iOS games en 250 nieuwe Android games uit. Er zijn grote successen, maar dat zijn er niet veel. De meeste games gaan ten onder in de massa. Mobiele games vergen continue aandacht in de vorm van updates. Verkopen via Amazon vormen minder dan tien procent van de Android sales.

Xbox One §  De installed base is niet echt bekend maar het zijn er ongeveer 10 miljoen. §  Low end games: 1.000 – 5.000 stuks §  Mid end games: 5.000 -20.000 stuks §  High end games: 20.000 – ? stuks §  Opmerkingen van Rose: In 2014 zijn er zo’n 20 indiegames uitgekomen. Een maximum aantal sales voor high end games kan Rose niet geven, omdat hij niemand heeft gesproken die hoge verkopen heeft gehaald. Dit jaar brengt tinyBuild een game uit op Xbox One.

Playstation 4 §  De installed base is 20 miljoen. §  Low end games: 1.000 – 10.000 stuks §  Mid end games: 10.000 -30.000 stuks §  High end games: 30.000 – 200.000 stuks §  Opmerkingen van Rose: In 2014 zijn er 60 indiegames uitgekomen op de PS4. Met kerst zijn er veel PS 4s verkocht, dus de aantallen voor 2015 kunnen hoger uitvallen. Het is mogelijk om een Playstation Plus launch deel te krijgen. Sony schat dan de verkopen in en geeft de developer daar geld voor. Ook na launch kan opname in Playstation Plus sales een boost geven. Price drops bieden ook kansen voor extra sales.

§  Ongoing definition debate: Applied games/ serious games/persuasive games/engagement design/gamification? §  Anyhow: §  2010: 1,5 billion Euro revenue worldwide §  2015: 10,2 billion Euro expected

§  Investeerders

§  Centre for Applied Games (Amsterdam): §  Direct met studios (Grendel, Ranj)

§  “44% of Dutch games companies is exclusively building applied games” (highest percentage worldwide)

§  Strong presence in market segments: §  §  §  §  § 

Maritime Security services Health care Education Business

•  High expectations: •  ‘By 2015, more than 50 % of organisations that manage innovation processes will gamify those processes.’ (Gartner) •  ‘40 percent of all Global Top 1000 companies will utilize some form of gaming in transformational processes.’ (KPMG)

•  Low production capacity!!! => there’s room for you there…. •  (there’s a lot more for next time…)