Worst moments in videogame marketing

Nokia thought this was a cool way to introduce their price point. Not.

Here's an excellent roundup of some of the most embarrassing moments in videogame marketing. Some of the winners include Nokia's launch of the ill-fated N-gage gaming phone, the infamous Daikatana ad where John Romero proclaims he's about to make you his bitch, and the wonderful Sony ad for the PSP where they managed to set back race relations a few years. It's worth a look, so you can see what not to do when you market your games.

How do you avoid getting your product and company on a list of the Worst Marketing in years to come? You may have a clever idea, or your marketing person may think it's brilliant, but it's always good to get a reality check, especially when you hear the words "edgy" or "bold" used to describe it. Show the marketing to some outsiders... people who aren't in the business, aren't hipsters, aren't too cool for words. Like your mom, or the next-door neighbor. See what they think. Remember, not everyone who will see your marketing is going to "get" the deeper layers of nuance you think are obvious. Some will just see the surface... and if they are repelled, your marketing is not having the proper effect.

GDC Day 1

Day 1

Partway through my first day at GDC, and I'm already finding some very interesting things even without attending any seminars yet. There are a handful of booths outside of the seminar area, and the vendors have some products of great interest for developers. Here's a quick rundown and some initial reactions to what I've seen so far:

kontagent. This is an analytics platform for social application developers, or so their literature says. What it really is: Analytics for marketers, that tells you about the demographics of the people playing your games. Your dashboard can give you data on the age of your player base, and where they are spending time and money in your game.... invaluable data for a marketer attempting to sway judgments on how to proceed with design or business. Probably not going to give you sufficient good info unless you have thousands of users, but at that point it seems like it's offering data I haven't seen from other analytics programs.

ideasystem. What is it with companies lower-casing their product names? Seems like an affectation to me. Regardless, this is an interesting middleware play: An entire set of tools and back-end support for creating your own social game or MMO. It's a true 3D engine (using the HeroEngine, no relation to any old company of mine) and the package offers free hosting, free billing and free marketing. They take 70% of your revenues, which seems pretty fair considering what they provide. Of course, if you are doing this through Facebook, Facebook takes 30% when people use Facebook Credits, and then ideasys takes 30% of what Facebook gives you. But it's still a pretty good deal for no hosting fees. Their tool set looks pretty robust... If you want to try some innovative game design or setting ideas for an MMO, this seems like a good place to start to minimize your risk. You could get a game to market much faster than building your own back end, and at far less cost. Hey, if the game takes off you could always build your own back end while still booking revenues from ideasys, and then switch over when your back end is built out.

blue noodle. Yet another lowercase name. Makes me want to type IN ALL CAPS. Sheesh. Despite that, it's an interesting idea: you can add a Clickstrip to your social or mobile game, and if the user clicks on it they watch a high-quality video ad. Why would the user do this? You give them an in-game reward... more smurfberries or the equivalent. Advertisers know they get a user to actually watch an ad. So you get more money with a different type of ad... this sounds like an interesting way to monetize, assuming they have enough advertisers on board.

adknowledge. OK, everybody is lower case now. I guess there's a new graphics rule for logos I wasn't aware of. Will this be overturned by the Supreme Court? Anyway, these guys have what they bill as the 4th largest advertiser marketplace, and it's a way to monetize your apps with a variety of advertising techniques. Worth a look if you're trying to figure out how to get money for your games, and ads are one way you're considering.

Aside from those vendors, I've had a number of very interesting discussions with a lot of people. This looks to be an excellent show for getting business done, and coming up with new ideas and new twists on business, and finding excellent people to work with.

Tomorrow will be even more interesting...

How To View GDC

The Game Developers Conference (GDC) takes place this coming week in San Francisco, and as usual I expect a great deal of news and insights about the gaming industry from the show. Close to 20,000 people involved in some way with the gaming business will be there, and there will be a spate of announcements, news, and rumors about gaming. I'll be blogging about my impressions of the show, and the information I gather, and my analysis of that information.

If you're attending this show, here are some thoughts about how to get the most from it. Most of these tips are useful for any trade show or convention.

See who's exhibiting, and how much space they have. You can get a very good feel for where things are headed in the business by seeing what types of businesses are paying for exhibit space, and how big their booths are. See lots of businesses catering to console developers? Looks like console development is going to be expanding. Lots of vendors talking about payment services? Look for lots of small companies, many trying to get bigger, who will need payment-related services.

What positions are people hiring for? At GDC the Career Expo is a major section, with all sorts of companies looking for employees. The kinds of employees they're looking for can tell you a lot about the state of the business and where things are headed. Sure, programmers are always sought after... but what type of programming? Is it C++, or is it Javascript, or Flex, or iOS, or Android, or HTML 5? You can get a fair idea of how much interest there is in any market segment by seeing what employees are most wanted.

When you chat with people, what are they saying about the business? Is it bad, good, changing? Have they changed jobs? Working at a smaller or a larger company? If you talk with a large number of people, and a good cross-section of the people, you'll get a sense of what's important to them about the business.

What are the seminars/lectures about, and how well-attended are they? Sure, the really popular speakers or the talks about a hit game will have a good crowd. But just looking at the list of talks can tell you what people are interested in, and seeing which talks are SRO gives you an indication of what people are interested in. For instance, talks about sales figures in mobile games a year ago were packed... because numbers are so hard to find, most of the companies being private.

You can learn much more from these indicators than you can from most keynote speeches. Marketers need to be tuned into these kind of indicators to get their own feel for where things are headed, and how fast they're likely to get there.

Dead Space 2 Marketing

EA's gotten creative with their marketing for the upcoming Deadspace 2 game. Their marketing team figured that, hey, this game is not going to be your mother's favorite video game, and someone must have said "Let's prove it!" So they brought in dozens of mothers and filmed their responses to clips of the game, and now they're busy marketing the game as something your mother will hate.

Personally, I'm pulling for it. At least it's nice to see some creativity displayed in marketing efforts. It's funny, and it certainly acknowledges the target market. It also illustrates a key marketing principle: Don't be afraid to give up a market in order to better target a more important market segment.

It's also worthy of note because this is a technique you can use even without a massive marketing budget. Sure, EA is spending money to get the word out about the videos, but you can achieve much of the same effect by making your own video and putting it on YouTube, then working social media to help it go viral. If you've got an interesting enough idea behind the video, you can get a lot of attention.

Is the game any good? Well, some reviewers seem to like it. I certainly think the marketing efforts are worthy of note.

7 Console Gaming Predictions For 2011

In 2011, radiation from 3D TVs will cause gamers to emit a green glow.

The console gaming market is now the "traditional" game market, composed  of software sold in retail stores. Of course, publishers are exploring other business models and types of games, investing in social games, mobile games, freemium games and more. The console gaming market is the bulk of game sales; if you just look at software, it was $10.6 billion in the US this last year (if you add in hardware sales, including accessories, the total is north of $21 billion).

The last couple of years have not been kind to the traditional segment of the business, though. Sales grew an amazing 28% in 2007 to hit a total of $18.85 billion overall ($9.5 billion in software), but the worldwide economic problems of 2008 were bound to have an effect. Game sales in 2008 were up 19% to over $21 billion (up more than 26% in software to over $11 billion), though signs of the slowdown were already showing up in holiday sales. Then 2009  showed up and hit hard with an 8% decline in overall sales to $19.66 billion (software slid to $10.5 billion).

While the year-end figures aren't tallied yet, 2010 looks like a decline again despite a record November that wasn't enough to rescue the year. Total sales will probably end up a few percent below last year (it was down 8% until November, which was enough to make it only 5% lower than last year). What's on tap for 2011?

• Software sales continue to erode. The overall picture doesn't look great for $60 software titles. While some releases will do well, overall I think the sales decline will continue as gamers move to lower-cost alternatives. And more lower-cost alternatives will continue to appear, and they'll be better.
• Console sales stay steady due to price cuts. Much as they will resist it, price cuts will happen by the holidays for all the consoles, though they may be minor. Or they may be hidden by increasing the value of the bundle you get (an extra controller, more software, etc.) Growth in smartphones, tablets, social games, and F2P (free-to-play) will tend to keep people from console purchases unless the price gets more attractive.
• Big hits are rare, and will get rarer. The high sales points get even higher for titles like Black Ops, but fewer titles will achieve orbital status. The publishers with the megahits may do well, but the ones without will be gasping for oxygen. It's going to be a cruel market.
• XBLA and PSN continue to grow sales. Meanwhile, though, those sneaky little download games will continue to gain despite the barriers placed in their way. (I mean, Microsoft Points instead of dollars? Really? Or how about that interface, and all of the non-existent tools for finding the types of games you're interested in...) Heck, even WiiWare will do better, despite Nintendo's almost criminal neglect. It turns out that customers are interested in lower-price titles they can have via download without a trip to a retail store. Who would have thought that?
• Nintendo finally reduces Wii to $149, then to $99 by Christmas. This one is actually more wishful thinking than a prediction. Yes, it would certainly be sensible for Nintendo to do this, but since they've been studiously avoiding sensible moves lately who can say what they will actually do.
• A successor to the Wii is finally announced, but it won't appear until 2012. Although Nintendo may not actually announce this, and information will just leak out, to avoid ruining already devastated Wii sales. By the time it actually appears the market may be so different that no one will care, unless Nintendo embraces the market changes.
• The 3DS and PSP2 appear to good initial sales that quickly decline to disappointing levels. Partly because the price points will be so high initially. Once the fanboys have gotten their units, less fanatical customers will look at the prices and think about buying a smartphone instead. Many will. Developers in particular will be annoyed, because developing for these new handhelds will be significantly more expensive than the old handhelds, yet software sales will be worse. This will lead to a quick fall-off of third-party support.

Overall, I expect the console business for 2011 to be up somewhat, mostly due to Kinect. Move, and price cuts. The software part of the business (at least the traditional retail boxed part) will be flat. Significant growth will continue to be in other areas like mobile, social, DLC and F2P.

3 Key Game Industry Trends

Is this how most game industry executives discover trends?

Several news stories breaking this week show signs of intelligent life in the game industry, and point to the new directions the industry is taking.

Gaming Gets Bigger Worldwide. Sure, this has been happening for a while, but since the beginning of electronic gaming the industry has been built around the United States, Japan, and Europe. If you've been watching, South Korea and China have become huge audiences for gaming and have grown some very large companies. which have been buying up US and Japanese companies. Gaming is spreading beyond these regions, as this study illustrates. The Southeast Asian game market will be close to $1 billion this year, and will hit $1.7 billion by 2014. So far, most  big game successes in that area have been home-grown, but World of Warcraft shows that a US game can do pretty well in an Asian market, thank you very much.

Indie Distribution Options Get Better. Indie games have struggled to find an audience, mostly relegated to Flash game aggregators like Kongregate. Now this article shows that options are increasing; EA Partners has signed up three indie developers to bring their titles to Xbox Live Arcade (XBLA), Playstation Network (PSN), and PC. It's a validation of those three games, of course, but also a message to indie developers that there is a wider market available they can reach even without the capital or experience necessary to navigate the process a Microsoft or a Sony will put you through. This also benefits EA, of course, by cutting them in on a revenue stream and helping identify good developers EA might want to acquire at some point in the future.

The Big Publishers Get Smarter. One example of this trend is the above item, where EA shows they are aware of things happening in the business and taking advantage of their strengths. An even better example is this article about comment's THQ's Brian Farrell made at an investor meeting in New York. He's planning to launch one of their AAA upcoming titles at $39.99 instead of $59.99, and hopes to make more money by selling DLC. He sees the important thing as building an audience for the title, which he can then monetize for years. Obviously it's easier to do that by selling the title at a lower price point, especially in a market environment where game sales are lagging. I think we'll see more publishers try this, and go to even greater lengths to build an audience for a title. We'll also see more different ways to monetize game development, through free-to-play and subscription options. I think the $60 price point is looking increasingly unsustainable for most titles, and we'll see fewer of those high-priced units in the future.

These trends offer some hope against the relentless drumbeat of poor sales numbers. There are going to be plenty of changes, though, so keeping ahead of things is even more vital for marketers.

Microsoft Vs. Indies

Microsoft has rolled out a new Xbox 360 dashboard, mostly to support Kinect and to look spiffier. But they've also made changes beyond the cosmetic, and in the process have ignited a firestorm among indie game developers. It seems Microsoft has moved the indie games out of the game store (where they have been, and you'd logically expect to find games). Now indie games are stuffed into the Specialty Shops, right next to the Avatar Clothing store. Seems eminently logical, doesn't it? But for some reason indie game developers aren't feeling the love.

Some developers feel that Microsoft was just stringing them along, allowing indie games as a way to get major publishers to support digital distribution. Now that they've got the major publishers trying it out, there's no need to clutter things up by allowing little tiny developers to use up space. Microsoft points out that hey, now they're showing the top 50 titles and not just the top 20 titles. Yeah, counter indie game developers, if anyone can even find the Indie Game store when it's not even with the rest of the games.

Developers who have been working on games for Xbox Live  and were getting near to release are especially angry, now that it looks like their games won't get much exposure. Many were hoping that they could move their games to Windows Phone 7, hoping for some strong connection between the two platforms. That may still happen, but Microsoft hasn't really said much about that.

I think Microsoft is making a mistake by sidelining the independent games. While the new dashboard is a little spiffier, it still makes it hard to find games. Much like iTunes and the Android Market and PSN and WiiWare... they all try different interfaces, and nobody's found a really good one yet. So it's up to the developer/publisher to try and get customers to come to the game. Not optimal, especially when you have tens of thousands of games to compete with on some platforms.

This incident also illustrates the dangers of dealing with a distribution channel. Sometimes the big dog scratches (like Apple or Microsoft) and the fleas get thrown off. Then again, if you didn't deal with a big distributor, you'd be left in the trackless wilderness of the Internet hoping for customers to stumble across your little game. Which brings us right back to marketing...

3DS Software Will Be More Expensive

Ah, Nintendo, always one to buck the industry trends. Sometimes this can be wildly successful; the Wii didn't go in the direction of HD and more horsepower like the PS3 and Xbox 360, but instead added motion control for a different type of gaming experience (and, not incidentally, a lower price point than the competition). Result: Nintendo wins that generation of the console wars hands down.

Now, as Nintendo's hardware and software sales are sagging, they are looking to the 3DS to give them a boost. The handheld itself won't be coming in at a low price; the launch price in Japan will be the equivalent of $300. Now Iwata-san is hinting that the software for the 3DS will be even higher than current DS software pricing.

A bold move, certainly, with the average price of game software dropping for years, and software sales down significantly over last year. It doesn't really seem like the right time to be raising prices. Between a very expensive handheld and higher software prices, this would seem to play right into the hands of Apple and Google, offering thousands of inexpensive titles (and even more free ones). Yes, you can only get Zelda on a 3DS... but at some point the overall price of the hardware and software will be too much for the customers.

I have my doubts that Nintendo can sustain these high prices over the long term; I predict sales will be less than stellar after the initial wave of early adopters. I think the shifts in the marketplace call for fundamental rethinking of business models; tinkering at the margins just isn't gonna do the job.

Here's your take-home marketing thought: If you're going to make a bold move, have some contingency plans handy in case it doesn't work out the way you think. Nintendo should have some plans ready...

To PR, Or Not To PR

Microsoft has certainly had some great PR moves in the past, and some excellent marketing. But every once in a while you get a blooper like this one: In an interview with Gamasutra, [Microsoft Kinect spokesman] Tsunoda boasted that Kinect will "blow away" iPad sales. The iPad sold 1 million units in its first 28 days on sale, and sold 3 million in three months.

OK, I understand you're trying to boost Kinect sales. But comparing how Kinect will do with something that is only vaguely connected, and is three or four times the price, isn't saying anything more than "I'm bad at PR." If you want to throw down a gauntlet, say that Kinect will beat out Move sales... though you'd have to be pretty convinced of your product to make that claim. Move is, at least on the surface, cheaper than Kinect (though you really have to compare a pair of full sets of Move controllers to a Kinect ). There's enough differences in pricing and configuration that you'd have to be really precise in order to make any kind of reasonable comparison (how do you count bundle sales, for instance?).

Really, it would be better to content yourself with something like "Kinect is going to sell millions of units over the holiday season." That gives you some wiggle room... does Easter count as a part of the holiday season?

For those of you called upon to be a press spokesman when it's not your day job, resist the temptation to be snarky or boastful. Be thoughtful instead... ahead of time. Prepare some remarks for the inevitable question you know will be coming; go over your answers carefully and think about how they'll come across. If you get asked questions that aren't on your prepared remarks, make a note and say you'll get back to them later on that. And then do so.