TechHub Meetup Insights: Freemium games & 2014 trends

Last night we had the first meetup of the year and it was a great one! We had some special guests over: Scott Humphries, Executive Producer at The Walt Disney Company and Mihai Pohontu, VP Game Operations, Disney Interactive.

We had a last minute change of moderator, and Dragos Hancu from Amber Studio Romania (LinkedIn) took over and got some very interesting insights from our speakers. Here are some of them:

The freemium model in gaming:

  • It depends on what you�re trying to build. I don�t think all types of games work in freemium.
  • Freemium is taking over paid. From the top 70 games in top grossing for the US, only 2 were paid, and the rest were freemium.
  • There is a massive shift towards freemium and it�s accelerating. The disruption will happen to console games too. In 3 years from now a massive share of the revenue for console games will come from freemium.
  • If you want to make significant revenue and don�t pursue a niche audience � freemium is the way to go.

Key metrics for freemium games:

  • Daily active users
  • Average revenue per daily active user
  • Retention � determines user base and repeat users in 24h.

How do you make a respectable freemium game?

  • Do it respectfully
  • Don�t prevent users from having fun
  • Try to sell them an enhanced experience
  • Unless the content and core experience are engaging and aspirational � they won�t pay to accelerate the experience
  • Don�t charge users for content or functionality
  • Make sure the first time experience is setting up your product for success
  • If 80% of users drop off at the tutorial � check the experience or look for the glitch in the funnel
  • Geo beta � test in certain areas and iron out the problems before a bigger launch
  • Don�t make the game play second to the monetization strategy.
  • Always look at what the customer wants.

The evolution of the freemium model:

  • There�s plenty of room for innovation, but there�s a certain amount of familiarity that the audience expects
  • Work on hybrids � taking common experiences and see if they can wrap different layers around it and testing them
  • Innovating in action � these are harder genres to create a great play experience for, but it's worth innovating

The influence of wearable technology:

  • There will be interesting things with wearable tech platforms and what we will do with them
  • Another new area: alternate reality games and augmented reality games (the world is your play field)

What is Disney focusing on:

  • Scott Humphries: "My strategy is to find amazing development partners to create great products for our user base."
  • Trying to find awesome teams to work with Disney�s great digital properties

The game developers community (RGDA)

Nine years ago we had extremely few major players and no small studios whatsoever. The culture and mentality were very rigid � there was no life after �Gameloft� �Ubisoft�, etc. This slowly changed and probably the first big wake up call was the moment Mihai Pohontu opened Jamdat / EA in Romania in 2005. Obviously we moved a long way from there; however we have a long road ahead.
Romania needs to have a heaven for collaboration if it�s going to become a big indie community. Do a better job about communicating to the media about the game dev community. Communicate with government institutions to gain funding and become a viable, subsidized ecosystem. Think how to attract venture capital to Romania and lobby to create legislation that will help the game dev community. Focus on facilitating the arrival of foreign capital.

The small guy / indies

  • Find out who you are as a company and tell that story to potential companies
  • Without user acquisition it�s close to impossible to make it in the app store � you need a partner that can help you gain visibility
  • There�s a lot of work you can do while you�re still employed to make the transition to indie games easier
  • Plan carefully and describe the game you�re trying to make
  • Try to understand the game direction, tell a visual story in a presentation format
  • Figure out the technical specs � technology, innovation, effort to make it, understand the cost of making it
  • Find some key people to talk to and work with
    • Get in touch with as many people as possible to find a publisher or a partner
    • Scott Humphries: "You have a lot of talent. Leverage it and leverage your network."

Do's and dont's:

  • Understand the service piece of the experience � have a team that can manage a customer base on a daily basis (database coding, server infrastructure, etc. � in order to be able to serve interactive experiences for these people)
  • Teams that aren't passionate about what they�re creating won�t succeed
  • Don�t let money be the motivation
  • Passion is critical � the courage to step out there and leave your cosy job
  • The studios start with a genre breaking innovation, but they shouldn't seek overnight success
  • Building successful games needs to have a great, well knit team
  • Start small � think of a game mechanic or game genre that derives only slightly from something that works
  • Plan for a 3 months development cycle and move on to something bigger
  • Understand limitations and work to surpass them.

This was just the first meetup and we'd like to thank our partners at RGDA. Just wait and see what comes next!