EGD News #74 — Soft launching an IP based game
It’s Joakim here. Greetings from Helsinki!
Last week I told you that I’ve started writing my second book. When I was writing book 1, “Long Term Game: How to Build a Video Games Company” in 20129, I spend two months and I had 40,000 words written. This time I’m going to take at least six months to write that amount of words. As I write, I want to get a feel for the atmosphere that I want to create in the books, so later this year I’ll revisit passages that I’ll write now, to get the right feel.
The topic of the book is also evolving, but I know where the material is coming from. Stay tuned for more 🙂
Just a heads up: I’ve got a new webinar coming up. Collin Foss from Skunkworks is coming on my webinar on April 15th to talk about “Building a Successful Merge Game in 8 Weeks“. Here’s the link to register for that one.
Now, on to the news.
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📹 Highlights from “Validate your game before you build it”
This week I hosted a webinar with Jesse Lempiäinen from GeekLab and we talked about how game developers can validate their game concept before they start to write any code.
Here are my highlights from this session.
1) Testing the concept
Jesse: “We’ve seen tests where, you have a word game, where you might have meta in it, or you might not. You can run this test and understand what would appeal the best with the audience.”
“We did some research and found out that dogs were actually by far more liked than cats. This could be the situation with a small studio: you’ve have your hunch, you’ve done exactly the same thought process and you have your dogs in there.”
“[In some tests] we’ve seen 100% in terms of relative uplift. Having that uplift on the marketing, and then also having a product that people already accepted better, then it’s something that’s expected to lift to retention as well.”
2) Store conversion and retention uplift
Joakim: “Does a honed marketing message really reflect to the better retention?”
Jesse: “In general, we’ve seen things improve. Having a 100% uplift is nothing new. If you do a test with the theme, the differences can be quite big. 100% is quite average, to be honest.”
3) Sanity check of tests
Jesse: “One good thing that we’ve seen on our platform is the repeatability of all these tests. Regardless of what you’re testing, so our statistical, like confidence rates, and those things have proven true proven to be like, quite accurate. So so the same same winners keep on winning. And you can actually make this this decision”
Watch the recording from this webinar by going here.
💰 Fundraising and great metrics
The major hurdle in early fundraising is the team and their experience. The second one is traction, showing that you have a built something that works. Either you did it in your previous job, where you lead a game team that shipped this and that successful game.
It gets tricky when the team and their traction are indecisive for an investor. The team has lots of experience, but nothing stellar, and the traction from their past and current projects is ok but not mind-blowing. What to do?
In recent years, I’ve seen that the teams who graduate from a 1-2M valuation to a 10M valuation are the ones who successfully soft launch a game with great retention metrics.
Getting great retention metrics is the not-often talked about hurdle. The team’s impressiveness isn’t anymore about the team’s previous work. The light is shined on the current body of work.
Sure, you sometimes get these Dream Games examples, where the team who built Toon Blast leaves to start a company with the same game team. They can raise big without a sweat.
Not everyone built Toon Blast. If you still want to raise at the early stage, you got to live in the future, especially when you don’t have metrics.
Imagine you have a working game. Now work backward from there in two-week sprints. Who would you hire to achieve this, and when?
A great game investor can read a lot about your capabilities by reviewing a plan like this.
A plan like this is also a promise. You are raising funding to execute a plan and not raise for your impressive resume or the hot gaming market where everyone wants to raise and build studios.
You have a plan, and you will execute based on that plan.
🏎 Soft Launching F1 Manager
I recently watched a presentation where Corentin Delprat from Hutch talks about developing and launching their F1 manager mobile game. The presentation revealed lots of insights from working with an IP like F1 and how that can work when dealing with a big audience like F1 fans, how you manage expectations, and how you take full advantage of an IP like that.
You land the license for F1. What do you do?
Corentin talks about how they decided to tackle the F1 manager for mobile. The metagame was adopted from Clash Royale, as it had been successfully transitioned to other sports games like Golf Clash and Tennis Clash.
From my experience, the “Clash” meta can be a copy and paste thing, as long as there are meaningful long-term goals on the horizon.
Corentin explained that they wanted to tailor a mobile F1 experience. They went for an F1 manager type of game, instead of a driving game, because Hutch has the experience as a racing studio, doing car games for mobile. They must have known that driving games don’t retain players well.
Mismatch with the audience?
The big question for Hutch was if F1 would be too niche, and could it be profitable? The fact was that F1 games hadn’t seen success on mobile. But still, F1 has a massive fan base. According to the Formula One organization, “The audience figures for 2020 show the strength and resilience of our sport, with average audience figures in 2020 at 87.4m and a total season cumulative audience of 1.5bn.”
Then you start breaking that down into players who play mobile games, and out of those, who want to play a Formula One game on the phones, versus playing Candy Crush or Clash of Clans, the portion dwindles down.
Speculation number one: F1 fans who’d like to play driving games on the phone? 0.01% of the potential audience.
Speculation number two: F1 fans who’d like to play an F1 manager on the phone? It has to be higher than 0.01% of the potential audience.
But it’s still a significant opportunity. Working with an IP has many benefits. As Corentin mentions, fans are familiar with the setting. When they see something in the game, they know what it is. They know that you need to change tires during a race and that an extra pitstop will cost valuable time and lost positions on the track.
CPI can be lowered because of a known IP, and the organic installs can be higher proportionately to what a non-IP racing manager would have.
Retention for an IP based game
When you have a mass influx of people coming to your game, there are mixed expectations. They might be expecting an F1 experience to be a game where you drive a Formula One car on your phone. You will churn players who are not happy when they instead have to play a manager of an F1 team.
This expectations mismatch hurts your Day-1 to Day-7 retention, but not so much after Day-30 since you’re keeping those players if you’re providing them meaningful long-term goals.
These long-term goals are: Get stronger, to beat harder content. And the harder content gives better rewards, and social recognition.
Once you reach a goal, the game offers another goal for you to beat. And you end up retaining your players.
🎙 Innovation in Mobile Game Ads
I recently hosted a webinar with Erik Bryant from Opera Event and Steven Chard from Luna Labs. Both companies are at the forefront of innovative mobile game ads, and I wanted to explore several topics on how game developers can utilize game creatives to win players over.
Listen to our discussion by going here.
📃 Articles worth reading
+ Roblox – an in-depth analysis — “Almost half a million users pay money into roblox every day. That is an astounding number, as typically most F2P games that have any spenders at all are in the single digit percent. Roblox cite this as the key reason that revenue has increased, and this shot up from 184,000 in 2019 almost tripling (2.7x). Again, this is driven by lockdown measures and I do not expect this to sustain going forward as we come out of it. For comparison, 1.04% of DAU were daily payers in 2018 and 2019, this grew to c. 1.5% of DAUs in 2020.”
+ Angel Investing: What Experienced Investors Wish They Knew When They Started — “Many experienced angels admit that they should have placed an even greater emphasis on the quality of the team and on the ways in which one could probe that early on.”
+ What Books are Highlighted the Most Densely? — “Of course, not all ebooks are worth highlighting the same. You’ll only highlight something if it’s so interesting or so well-written that you want to see it again. This suggests that the more a book is highlighted, the more interesting or well-written it probably is.”
+ Investing: The Greatest Show On Earth — “Let me share two quick stories that have nothing to do with investing. I want to convince you of something important and overlooked: Investing is a broader field than it looks, and there is so much to learn about it outside of the narrow lens of finance.”
💬 Quote that I’m thinking about
“One of the biggest things that holds us back in life is we’re unwilling to look like an idiot in the short term, to be successful in the long term” — Shane Parrish
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That’s all for this week! I hope you have a relaxing weekend and I’ll see you next week!