Are the App Store and Google Play charts frozen?
In our Stateside column last week, 148Apps' Carter Dotson suggested that, while the success of Clash of Clans and Candy Crush delivers positive headlines for the mobile industry, their run at the top of the charts is harming creativity.
"Part of what made mobile such an exciting space to be in after the launch of the App Store in 2008 was the fact that studios were constantly innovating and being rewarded for that endeavour," detailed Carter.
"Rather that sequels being guaranteed bankers stagnating the market as they do on consoles developers learned that, taking a risk and doing something different was more likely to pay off.
"In short, this innovation drove mobile forward. Fast forward to 2013, and the variety of titles at the top of the charts is very low. New ideas are being shut out, or driven away from mobile entirely."
So, we asked out Mavens:
Has creativity in mobile really stagnated?
Have formally small studios like Supercell and King become the new EA and Activision, squeezing out the smaller outfits and making their chances of success slimmer and slimmer? Or is this an overreaction, and mobile remains the vibrant sector it was two to three years ago?
Well if anyone would care to shoot down this chain of logic, I'm all ears:
- Free is the dominant trend in mobile games pricing
- Visibility on the free charts is the single deciding factor for any download volumes. No visibility, no downloads
- Free charts are controlled by paid user acquisition. Indie marketing methods have very little ability to reach the required numbers
- Those who can afford to buy users are the big F2P companies
As a gross estimation of the user acquisition costs (according to Chartboost CPI heat map) you' need a budget of around $40,000 per day to get to top 50 free and sustain the position - that's $1.67 x 23,000 daily downloads.
The only paid game in the top 50 grossing is Minecraft Pocket Edition, with its bold price point of $6.99. The next paid games are at ranks 79 and 80.
Competing in the paid charts seems to be the only option for smaller studios, but it remains to be seen what kind of a developer community that segment of the market will sustain.
At least the download numbers required to break into the charts seem to be such that positive buzz on the relevant websites might still make a difference.
Opportunities for indie success stories like Badland certainly still exist, but it can be debated whether or not a small studio can (or should) rely on being repeatedly featured by the platform holder.
Looking at the top 50 paid games in the US, the majority of the charts seem to be ruled by big studios and big brands. There are few exceptions (and the exceptions seem to be heavily Minecraft-inspired).
It seems to me that unless the App Store brings in changes to its discovery mechanisms, small independent studios should investigate alternative platform opportunities for their long-term strategy.
Or, alternatively, put all eggs in one basket and invest everything in creating showcase apps, hoping to compete with the likes of Real Racing (which has gone F2P) and Infinity Blade for some platform holder attention.
I believe the US charts not moving is actually directly tied to the US Government shutdown...
Okay, back to reality. F2P requires a lot of money to acquire eyeballs to make it work. New dev teams and studios in this realm are able to raise a decent amount of money to execute on the F2P strategy if they are proven veterans. I see the deals happening.
It's funny to consider people veterans when the industry is so young, but that's the wordage.
I personally consult young studios to go the paid route because they are building a brand based off their own social media. They need to always be selling themselves as interesting people and their titles as cool must haves.
I have been saying for a while that the charts are similar to the pop music industry.
Someone comes out with something that resonates and a hundred people show up a month later with songs - games in this matter - that are considered clones of the genre leader.
Clash of Clans
Does it stifle innovation? Pure and new innovation I'd say yes. Innovative ways to use the core of what made the original title great are still innovative. That's why we can have so many people building different types of four wheeled cars.
Trying to stop the indies would be like trying to parch an ocean with a hairdryer: There will always be cool, clever, never-seen-it-before games being released into to market and word-of-mouth will carry some of them to headlines and to riches.
That said, development costs are in no way proportional to marketing costs; entrenched publishers will always have the upper-hand when it comes to user acquisition. And, if you think user acquisition costs are bad now, ask yourself if the ceiling on acquiring a player can reach $9?
Effective Cost per Acquisition (eCPA) is the biggest challenge to launching profitable new game product. If you want to be an indie studio and release cool new product, business-be-damned, absolutely nothing is stopping you.
If you want to achieve repeatable, scalable business, well, you have to get smarter about growth hacking.
Bringing eCPA down to levels that make business sense is actually not an unachievable prospect: Bringing eCPA down to manageable levels could be achieved through concerted effort on the part of all indies everywhere.
If all indies adopted a system for tit-for-tat cross promotion, a machine learning arbitrage of equitable player flow, yes, crappy titles would still die on the vine, but worthy titles would gain much more exposure.
If BitCoin can decentralise currency, why can't somebody decentralise Chartboost?
Are the app stores are frozen? No, but it is very hard to reach the top positions.
I remember some years ago many people told me "we won't do mobile - there are no revenues ." Now, after Candy Crush and Clash of Clans, everybody wants to do mobile.
There are apps developed by companies that have big fountains of money, but they don't know how to do marketing well. If you can't get the players, you can't get the revenue either.
If you want to beat Supercell or King, it's simply not enough to have a lot of money you also have to master marketing.
But there's another problem. Candy Crush and Clash of Clans are not just big, they're also great games. That means taking them down if you don't have the money to spend on masses of marketing - is a case of making a game that, simply speaking, is even better.
It's hard, but I'm sure it's possible. We're working on it. Give us a month.
Creativity is more important than ever and I think we rely hugely on the indies for that.
As you point out, mobile is being adopted by many (if not most) games companies as the strategic focus and this, as we all know, is driven by the anticipated huge uptake of smartphones and tablets over coming years.
Right now we see these blockbuster titles such as Candy Crush reaching staggering player volumes of over 100 million monthly active users (MAUs). On the back of mass smartphone uptake, how long is it before we see that number top 1 billion?
Candy Crush Saga
So, for sure, the playing field has changed because of the potential sums involved. Everyone is trying to have a bite and many of them are bringing large marketing budgets and know-how that the indies don't have.
It's likely, in the current ecosystem, that the 'top charts' will remain dominated in the short term by the same companies. However, I think we will continue to see a lot of movement further down the charts in positions 101-1,000, perhaps.
It's going to be possible to build a very successful business occupying these chart positions. A game at position 1,000 is likely to have a player base of several million going forward. Some of these studios will rise up the charts and some will be acquired and, unfortunately, some will be copied by the bigger guys.
A studio's innovation and creativity will be critical in determining which outcome lies ahead for it.
Finally, I agree with Jani and like Scott's growth hacking points. The whole discovery process must and hopefully will change. There is likely to be a lot more stores going forward (at least on Android - the fastest growing platform) and new ways to get discovered.
The creativity required from studios is not limited to game design alone - they also need to get very creative when it comes to marketing.
A 20-year veteran of video games and online space, Harry is European CEO of Marvelous AQL, a Japanese developer and publisher of social, mobile and console games, known for console games like No More Heroes and Harvest Moon, but now highly successful in the free-to-play mobile and web space in Japan and Asia.
A games programmer before joining Sony’s early PlayStation team in 1994, he then founded developer Pure Entertainment, which IPO’d and launched a free-to-play online gaming service way back in 1999.
He was also a director of pioneering motion gaming startup In2Games, which was sold to a US group in 2008.
Along the way, he’s been a corporate VP, troubleshooter, and non-exec to a variety of companies and investors in and around the games sector.
I think there's a tendency to look at this issue backwards.
The reason we see certain titles dominate the charts is not because the creators have a lot of money. It's because the creators made a great, fun game which has excellent retention and monetisation.
That, in turn, gives them a good return on investment on user acquisition, so they can get into the cycle of spend, acquire, profit, which spirals up into the big numbers those games enjoy.
You could spend $50 million acquiring users for most games, and you'd lose every penny.
For me, it's all about the game. If a developer has a F2P game which is demonstrably fun, which makes people want to keep playing and, in enough cases, playing, they've done the difficult bit.
Getting marketing money - whether from a publisher or VC investor - is perfectly achievable if your game is a viable financial proposition. If it's not, marketing money won't help.
What you need in that instance is more money to spend on development, to buy you the time and expertise to refine the game until it does work.
Of course, there's huge expertise and value in doing that user acquisition as effectively as possible, but nobody is closed out of making a successful product in my opinion.
As Evangelist for Applifier’s Everyplay platform, Oscar spreads the word on the game discovery benefits of gameplay recording & sharing, how opt-in video advertising can help convert non-paying users, as well as bring in direct revenue.
He has been a pioneer in online, mobile, and console social games services since 1998. He is also currently working on his first book, Games As A Service – How Free To Play Design Can Make Better Games, expected in March 2014.
The trouble is that we are conflating the wrong issues.
First, lets start with charts based on total downloads/sales. Whilst these are great for us as developers to see how well we are doing, they are terrible for users because they become a self-fulfilling prophecy. Stagnant charts lead to an undue focus only on those games at the top of the chart.
There is only one chart I pay any attention to personally; Google's Trending chart. It's brilliant and always show the latest interesting content.
At 3UK, I refused to have sales-based charts. Don't get me wrong - we had top 10's. Top New Games, Top £3 Games, Top Rent Games, etc. But these were editorial lists of newly released or updated content. hat might sound like cheating, but it meant that users could find new content; oh! and we were upfront that this was editorial too.
I went on a long holiday and came back to find one of the managers had forced the team to put in a Top 10 sales chart and the net result was that we'd had a massive drop in sales and those sales we still got were overly focused on just the titles thst had already been selling.
That takes me onto Jani's point about how flooded the free charts are. He is right they are flooded; but there is an important difference between life on app stores now and in the past, when 3UK ruled the mobile waves (I know that sounds egotistical; but 68 percent of UK mobile games purchases in 2005 is a pretty solid stat).
The App Store isn't the only place to get information about games, but boy is it powerful; sure it's incredibly influential; but its still possible to make money without being in the top 100.
I don't think Flurry has updated this stat in a while, but it has shown that just under 70 percent of all revenue on the App Store comes outside the top 100.
The costs of getting (and staying) in the top 100 are extraordinary and, as Scott has said, it can reach extraordinary heights - e.g. $9 Cost of Acquisition.
Logic, then, says that you should go for the less competitive paid chart.
A price upfront says something about the quality of the game (provided you live up to that and be very wary if you don't!). It also provides a utility for the player to sustain their interest in the game after they have started playing. There is even some scope for selling additional content.
However, you are cutting off a vastly larger audience who simply won't take the risk on paying upfront. You also cap the long term willingness for the players you get to spend money (in most cases).
There are exceptions, but paying up front and then again in the game does breach a level of trust that players have come to expect.
Then I need to correct a wrongly quoted stat from the last Mavens question. John Ozimek quoted a Flurry stat which talked about $14 being the average spend in the US for a freemium game. I met up with Richard Firminger from Flurry the other day and he reminded me that this is not, as quoted, the lifetime spend for freemium games.
Instead, $14 was the average US transaction value in 2011! I don't have any stats on the average lifetime value sadly, but its vastly greater than most people realise.
I'm not suggesting we can all get $14 per month for every player of course; or even $14 per month from 3 percent of players for every game, but this changed model means that economically freemium games delivered as services have extraordinary potential even for small indie developers; long after the paid chart becomes as clogged up as the free chart have become.
The App Store charts are like the Sirens in Homer's Odyssey. If we listen to their music, we will go mad and crash on the rocks. Of course the charts matter. Of course they drive downloads, but getting to the top of those charts either takes a huge amount of money or instead we can focus on other things.
Why do titles like Badlands make it into the charts? They have qualities which inspire and compel an audience to talk about them. We aren't just tied to the charts to be discovered.
Indeed, in a Applifier survey we found that participants stated that the App Store, including features, search and top charts, represented 35.1 percent of the influences on their decision to make a purchase/download.
Advertising represented 12.4 percent of that influence, but 37.2 percent came from word of mouth and social media. The remaining 15.3 percent was other media, such as TV, YouTube or other media.
Advertising is extremely important, but we need to balance our efforts so we create the context for success. There is life outside the charts!