This article is part of a Gaming Insights series paid for by Facebook.
Day One of the GamesBeat event, Driving Game Growth, presented in partnership with Facebook, is in the books. The all-digital event brought leaders in the gaming world together for a deep dive into some of the biggest issues developers and publishers are facing in a world in flux.
From privacy changes to evolutions in mobile game monetization, what’s next for investors and more, here’s a taste of each of the day’s sessions — plus links to watch the full recording of each panel. They’re not to be missed.
Growth Opportunities in 2021: The Facebook Perspective
Was the bump we saw in new gamers and more spending in 2020 a pandemic-fueled anomaly? And how will game companies top their stellar quarterly and annual results? For insight from Facebook, Dean Takahashi, lead writer of GamesBeat, spoke with Rick Kelley, VP of Global Gaming at Facebook, as well as Steve Webb, Global Lead for Facebook Audience Network.
Facebook Gaming’s new report — Games Marketing Insights for 2021 — found new players in the U.S. grew by 28 million (up 28%) since March, and they’re still playing and engaged, Kelley said. “There are challenges that we’ll get into in 2021, but the opportunity is big,” Kelley said.
But the game industry also depends on the winds of change in broader markets. High unemployment could curb spending by gamers. Plus IDFA is poised to hit the industry.
To counteract the risks related to IDFA, Facebook is helping developers focus on better quality for the creative material in ads, and more automation in optimizing ads in games. Improving monetization will help those affected by the uncertain IDFA situation.
“Despite this cloud that is hanging over everyone’s head because of IDFA, there’s never been a better time to be in gaming,” Kelley said. “The growth that we’ve seen in the last 12 months is immense.”
New money from huge institutions from Blackstone to Tencent came into games. If gaming gets rocket fuel to expand further and invest in better games, he said, then we could definitely surpass the growth of 2020.
“Even with the expected headwinds for IDFA, it’s still poised for massive growth,” Webb said. “There are more gamers. More playing time. More advertisers. That equals higher revenue. There’s a lot we should be excited about, but we do recognize there is some short-term disruption while we navigate the IDFA trends. Stay encouraged, and be excited.”
Growth Opportunities in 2021: The Jam City Perspective
Jam City president Josh Yguado said he is optimistic that the game industry can continue to grow in 2021, despite the challenge of having to beat record growth numbers for 2020.
“It is going to be hard to beat the incredible growth rates we saw in 2020, but the silver lining is that the big bumps we saw in user acquisition and new players into our games have held,” he said. “These weren’t temporary users. These weren’t temporary wins. All of that is sustaining, at least at Jam City. It accelerated some trends that were already happening.”
Yguado said that his company will lean in when it comes to making games more social. “Your social graph is always with you on the phone,” he explained. “Players are picking up their phones as an entertainment powerhouse as a convenient alternative to watching TV.”
Story and writing have become more important as games start to replace other forms of entertainment like books and movies. And hiring beyond the tight game ecosystem has will continue to be critical for Jam City to reach new heights in production and storytelling – bringing on writers, artists, and musicians who used to work in television and film.
Asked if he would buy a Hollywood studio, Yguado said, “We are a Hollywood studio. That’s the point. We’re creating intellectual properties.”
Monetization Myths Debunked
Monetization in free-to-play (F2P) and freemium games is in constant flux. What developers thought they knew about monetization is no longer true and other things have changed beyond recognition.
Moderator Rina Hahm, the head of North America West at Facebook Audience Network, spoke with Chris Akhavan, the SVP of business development, corporate development, and advertising at Glu Mobile along with Lila Games CEO Joseph Kim about what’s true, what’s not, and why balance is the key.
Does in-app advertising cannibalize in-app purchases? How much do players really hate in-app advertising and in-app purchases in the same game? And is it really difficult to implement in-app advertising? Watch the panel debunk these myths, offer invaluable monetization advice for a modern mobile gaming ecosystem, and more.
Winning with Rewarded Video Across Genres
Mobile in-game ad revenue is a booming business, and it’s overtaking IAP. Rose Agozzino from Ludia and Sarah Ketir from Product Madness joined Heath Schindler, strategic partner manager at Facebook Audience Network to dive into the rewarded video opportunity – and why they’re never looking back.
One of the main reasons developers are investing more in in-app advertising is because users are open to receiving in-game ads, Schindler said. According to a recent study by 2CV, 79% of players are happy with the ad-supported model.
“Because we’re primarily IAP-driven, we were among those skeptics — how is this going to impact IAP?” Agozzino said. “But slowly we’ve added in rewarded video ads and we’re not looking back.”
“If you think about just IAP, you’re missing a huge opportunity,” Ketir said. “More than 90% of users aren’t payers. This is basically where we come from with Product Madness: We’re doing well as a company, but how can we monetize those non-payers?”
Saying Goodbye to Waterfalls: From Burdens to Bidding
Mary Kim, Head of Growth at Game Hive, and Alfred Fung, CEO at FUN-GI Games, joined Wai Quai Chong, a Strategic Partner Manager at Facebook Audience Network, to discuss why ad bidding matters — and why it’s important for developers to shift away from waterfalls.
“When we first heard about the notion of bidding coming into mobile, we couldn’t wait to get started,” said Kim. “Now, today, we are seeing about 70% of all of our ad revenue coming directly from bidding.”
Fung, the founder and CEO of FUN-GI Games, the game design and publishing studio behind House Flip, said his developers have been integrating ad-based monetization, and app bidding, into their game from the start.
“The question was, how can we create an ecosystem where we’re not always having to manage the waterfall?” he said. “Using Mary’s term, it ends up being a no-brainer, where we’re able to concentrate a lot more of our resources and production efforts toward making the product better.”
Facebook Audience Network is accelerating the move to a bidding-only network to help prepare publishers for upcoming iOS 14 changes, Chong said.
Mergers and Acquisitions: Behind the Deal during a Pandemic
Nate Morgan, the global gaming Lead for Facebook Audience Network, moderated a conversation with Kris Davis, VP of business development at Kabam; Rob Ricca, VP of corporate development at Scopely; and Nick Tuosto from LionTree, weighing in on what M&A looked like in 2020, pandemic and all.
Thanks to 2020, gaming as a sector is looking better and better for even the most timid investors, partially because gaming saw such a lift from people staying home and partially because of the value being created at companies who practiced responsible M&A.
Kabam’s approach to M&A in 2020 (and beyond), according to Davis, is centered around people, not necessarily projects.
“First and foremost at Kabam, we look for great game makers that have a great deal of passion and conviction for the things that they’re working on,” Davis noted. Ricca’s approach at Scopely is more aligned with bringing partnerships into the fold full-time, much as Zynga has with many of its mergers and acquisitions in the last five years.
Marketing Mobile Game Apps: Achieve More with Less via Automation
Lower cost, greater scale, better efficiency — this is the promise of automation for mobile game marketers. To discuss the power of automation, and their success with it, John Choi, head of growth marketing at Pocket Gems, and Jerome Turnbull, VP of growth at AppLovin, joined Susan “Spark” Park, head of global gaming ads at Facebook.
“Automation brings a lot of positivity into marketing overall,” Choi said. “Automation will give us a lot more time to focus on making sure that we’re building the product that will give the best result for the players that we’re building with here.”
“It frees up a lot of time for our teams to work on other projects, and that’s important for them, to develop and explore and stay focused,” Turnbull said.
Choi’s team implemented Facebook’s three-month-old Automated App Ads product ahead of the iOS 14 rollout. They quickly realized the Automated App Ads campaigns were performing better than the main campaigns that they’d been running for a while.
“It’s great to see that the Automated App Ads campaigns can quickly find the winner and then start scaling, to an extent where we decided to go back and re-run all the creatives that we ran in the past, and then retest them with Automated App Ads,” he said. “We found that some of the campaigns and creatives are performing much better than when we tested them before. The positives that it brings to the team were great, and it’s much more simplified. It takes less time. Financially it’s much better compared to before.”
Finding More Gamers through Instantly Accessible Games and the cloud
The game industry isn’t done breaking down barriers to make games more accessible. That’s the view of Jason Rubin, vice president of play at Facebook, as expressed in a fireside chat with Dean Takahashi. By knocking down these barriers, companies like Facebook can help create a post-app-store world where it’s easier to access games with your friends, he said.
Instant games have drawn more than 350 million players to Facebook. Such games require no download at all and use tech such as HTML5, the lingua franca of the web. Those are instantly playable, with no download time required. All told, Facebook has 2.7 billion users.
When you include people watching streamers or tournaments or talking about games in groups, then more than 700 million monthly active users on Facebook engage with games.
“I think that number can get bigger,” Rubin said. “I think there are people that aren’t currently playing games on Facebook that our cloud technology will” attract to the platform.
Facebook acquired its cloud technology when it bought Madrid-based cloud gaming startup PlayGiga for $78 million last year. Then Facebook launched the beta version of its cloud gaming service in October, enabling players to play high-end games on Facebook with no download required. More than 200,000 people a week were using the cloud games at the outset.
The sweet spot for Facebook is its ability to draw people back over and over, sometimes to catch up with friends, watch a video, read the news, or otherwise find things of interest. Now Facebook will give them a reason to come back by connecting people with games they want to play, instantly.
“If your friend is playing a game and they post a high score, that’s another great way to find games because you know it’s good because your friend is playing it,” Rubin said.
Next-generation Console Games: How to Grow Games at Scale
“This past year has shifted the page quite a bit for E3, Gamescom, and EA Live, but those events are still important,” said EA VP of global brand management and marketing Andrea Hopelain. “They drive the industry toward moments in time where mass player groups are looking for announcements.”
Hopelain joined Ryan Maloney, the head of cross-platform gaming sales at Facebook to discuss the challenges of making crossplay between consoles and mobile platforms work, the future of major gaming events, and the evolution of live service games now that a new generation of consoles has launched.
“The community and user engagement around those moments in time just goes through the roof,” Maloney said, adding that those moments will only get bigger now that they can be held virtually. “Everyone aligning on a key moment is really critical […] especially since we’re no longer limited by the walls of a convention center.”
Reaching International Audiences: The Importance of Culturalizing Games and Campaigns
Culturalization is a gigantic part of game development. The best way to make sure your game will work in another country and culture is to adapt it to the people living there. Language, according to Facebook Audience Network’s Hahn Kim, Jam City’s Brian Sapp and Imangi Studios’ Walter Devins is just the beginning of that process.
“Language is the bare minimum,” said Kim, citing a study the social media company had conducted. “Culturalization is adapting a games look, feel, and tone to a market’s value and belief system.”
Over the course of the panel, moderated by Geogrify’s Kate Edwards, they discussed culturalization and what it means for game studios to bring their experiences to other cultures, beyond translating the words in their games. The main point the panel kept returning to is that culturalization must happen on multiple levels in order to truly be effective.
All the panelists agreed that culturalization, which can be described as a deeper form of localization, happens at all levels of a game — including the gameplay systems, controls, narrative, language, and in-game economy. It’s similar to localization, although that term often focuses mainly on language on not the other elements listed above.
But is it always worth it?
Moving the Gaming Industry Forward Through Actionable D&I Efforts
Diversity and inclusion is meant to be a holistic model that desperately needs full saturation in every facet of every industry. Nene Kalu Schaffert, a strategic partner manager for Adtech Partnerships at Facebook, spoke with Ayanna Smith, a corporate impact strategist, about opportunities missed and why diversity and inclusion is “smart business.”
They moved beyond the Diversity 101 rhetoric to dive into a much more meaningful conversation about what we can do to support diversity and inclusion in gaming today, and why it’s just good business.
They also threw a spotlight on Schaffert’s pilot program at Facebook, Game Dev Alpha. Signups for Game Dev Alpha open up in February and will be available for underrepresented American game developers who want to spur their gaming project(s) along, but may not know how or have the resources to do so.
“I wanted to use Facebook’s resources and the partnerships that we have with the people who have these ideas, but might not be able to move it forward on their own,” Schaffert explained. “So, we will have training for them, we’ll have business coaching for them, we’ll have experts from the Facebook side talk about user acquisition, monetization, storytelling, you name it.”
While inroads are being made, it isn’t enough, Smith said. She underscored the importance of ensuring that game companies do more than the bare minimum to attract, cultivate, and enrich underrepresented game makers.
“You Can’t Be What You Can’t See: Driving Positive Change in Gaming
At the end of GamesBeat and Facebook’s Driving Game Growth event, Global Director of Games Partnerships at Facebook, Leo Olebe, along with Lual Mayen, Founder of Junub Games, and Dean Takahashi spoke about how to get inspiration in the game industry today, how to inspire game developers to be their best selves, and put proven diversity practices into effect.
Lual Mayen, a former refugee who left Africa to become a game developer in the U.S., shared his story, and how he came to receive recognition from The Game Awards and CNN for his mission to make games about peace.
“We’re in an amazing industry, that’s filled with amazing people, who are ready to tell amazing stories,” Olebe said. “If we are listening, if we are doing the best job we can to listen, then inspiration can’t help but come through. Lual’s story is an incredible example of this.”
All videos from the event can be accessed on demand right here.
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