Social Gaming: enlarging the pool of players

Last January the size of this sector that exploded in 2010 was estimated in £1bn, and thanks to factors such as social networks is expected that will continue to grow surpassing experts´ expectations.

First of all, let`s try define what social games are (SG), and what they are not. SG are games in which players can interact and share content through the web. This emerging trend has made the gaming experience to be

transformed from a lonely, individually-played activity, to a universal social experience that can be shared with family and friends

One of the main driver of this changes comes from one of the 7 principles of Web 2.0., the fact that the user is not only willing to read content, he wants also to become a producer (“prosumer”), to share it and get recognition. When people play SG usually their scores are shown on their social networks, creating buzz, and making more people join the experience (network effect). This has changed completely the gamers´ profile by making non traditional gamers to become interested. The chart below give some hints about how even elderly people has felt attracted by this idea. Is not anymore about geeks and hardcore gamers, is about my mom and your grandpa playing FarmVille (Zynga major hit) and mocking one another.

In the past traditional companies developing games, made money by selling their titles, merchandising, rights for movies, and recently also by embedding advertising on their products (advergames). The problem is that titles for core gamers were becoming extremely expensive to develop, while companies did not have any guarantees for success. This led them to do two things, initially to focus only on AAA titles and franchises that have a proven track record of sales success, and secondly to move to other lower capital intensive projects that could be distributed on the web (less risk, higher ROI, bypassing the traditional distribution chain that was taking away a biggest chunk of revenues).

The new problem is that, the most successful SG are usually offered for free... so how companies such as EA and Disney are going to make money?. Exactly! Advergames, virtual goods, subscription or micropayments to have access to special features of the game.

As I mentioned before, is not about geeks and tech-freaks playing hardcore games, is about everybody spending an hour each day in front of their computers playing casual SG at the office, on their smartphones, or at their homes. This can represent a great opportunity for companies willing to squeeze the potential revenues that can be made with advergames... and do not be naive if you were planning to say that there is not enough money, look at Google... free services with advertising it is a very powerful combination.

References:

http://econsultancy.com/uk/blog/7022-social-gaming-trends-for-2011

http://gametheoryonline.com/2011/05/16/video-games-publishers-sales-extinct/

http://blog.games.com/2011/01/12/social-gaming-1-billion-industry/
www.emarketer.com