IGC'04 Impressions, Big Business, Big Money

Discussion in 'Indie Business' started by Dan MacDonald, Oct 12, 2004.

  1. KNau

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    I think part of the damage being done to the indie psychology can be traced back to the early days of Dexterity and the "Make $10,000 a Month" article. Steve has since tempered his statement with the note that it took him about 2 years to achieve a state of profitability but the idea of that kind of instant success had already been set loose. Many developers lately seem to be planning to become instantly successful and can't understand why it isn't happening. It becomes very easy to blame the market.

    If you are just releasing games this year, chances are you won't become self-sufficient until sometime in 2006! Yes, there are cases like "Think Tanks" where the success seems massive and instantaneous but don't bank on it happening to you.

    I'm currently writing a developer centric article that will hopefully be posted on Game Tunnel about making games that are true to your heart and the mistakes I made with my business launch. I don't want to give too much away but here are a couple points:

    1) The casual market is over-represented? Well, good riddance! I made the mistake of chasing "the fastest growing market" rather than making interesting games. I got my 2% conversion rate but with no traffic and no customer loyalty. There's just too much competition for the same dollars. Some people can swallow their pride and make match 3 games to chase after a piece of that ever-diminishing pie but I just discovered that I can't.

    2) The portals are making buttloads of money from the casual market because it was the most underrepresented market. It's not anymore and I predict that within the next 18 months all the portals who talked sh*t to developers will come crawling back looking for new content because no one is buying the same old same old that they're selling. Even soccer moms are astute enough to know when a gaming concept gets old and I've heard a dirty rumor that the new Puzzle Inlay / Match 3 clones aren't selling near what the originals did.

    They will have to find a new market to oversaturate and that's when you will appear out of the woodwork with your collection of action/strategy (or whatever) games. You the developer will have all the bargaining power because by that time they will need you more than you will need them. Wouldn't you feel better having big name publishers chase you? I bet then your e-mails will get answered pretty damned quickly!

    3) Step outside the "dl.com + press release + shareware sites" box because that method just doesn't work by itself anymore (if it ever did). Gamers come from all walks of life and they don't always visit gaming news sites. Actually, statistically very few of them do.

    Gamers hang out in coffee shops, read comic books, play board games, go to the movies, read Fangoria, etc. There are a million sneaky ways to get your product in front of a potential customer's eyes because gamers are everywhere!

    Internet advertising is largely a waste of money, especially when you are starting out and sales from your site are low or non-existent. Buy a copy of "Guerilla Marketing", start networking and get creative! Start locally!
     
  2. Andy

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    So... advertise everywhere?
    BUT! Not at dl.com, not in press releases, not in download archives and not in the Web? :confused:
     
  3. KNau

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    What I mean is that gamers are all around you. It's up to you to figure out what your particular niche is and how to target them but, yes, I think you would do just as well to forget about the old "dl.com, press-release, shareware sites" as paid promotions.

    You should still submit to shareware sites, send press releases, etc. but don't pay for it and don't give it more than passing attention because they aren't very effective methods. It's just too hard to stand out when you're doing what everyone else is doing, even if your game is brilliant.

    I found paying for those services useful to do once because then I was able to find out what sites deliver traffic and what ones are pointless. Not all shareware / news sites are created equally so in the future I won't even bother with the ones that didn't deliver bang for the buck. In total, I found 4 shareware sites and 6 news sites that deliver - the rest were pointless. That makes future press release and game submissions much easier having narrowed the list.

    Alternative Marketing Example:Most movie theaters will let you buy full sceen advertising in their pre-movie slide shows for reasonable amounts. There is a captive audience that will read your ad fully, 3 to 4 times in the cycle before the movie starts. That's just an example of one of the zillions of possibilities out there. Will it work? You won't know until you try.
     
    #83 KNau, Oct 14, 2004
    Last edited: Oct 14, 2004
  4. Hamumu

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    KNau, That's exactly what I was trying to say with my clumsy analogy. And especially, if you ARE targeting "casual gamers", well, they're casual, so odds are good that the majority of the time, they're not at their computer! So yeah, start dropping ads out there in the real world! Of course, as with any advertising, measure and test so you're not wasting money. But I think the potential is very good for success in that way.
     
  5. Greg Squire

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    From my limited understanding of marketing, word of mouth can be a powerful thing. But the way I see it, you have to do two things to get it working. First create a good game that people will talk about (bad games don't get discussed), and then you have to "prime the pump" (word of mouth starts with your mouth). You've got to be creative at "Guerilla Marketing" to start the ball rolling. And then you have to do it often, to start more balls rolling. Some balls will run out of steam, but others (hopefully) will continue and maybe start other balls rolling as well.
     
  6. svero

    Moderator Original Member Indie Author

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    >I haven't seen this at all. While a few important sites have disappeared or
    >been swallowed up by others (I'm thinking mainly of Altavista, Excite,
    >Infoseek, etc) that has been more than made up for by an increase in
    >traffic from the remaining.

    I don't know what internet you're using but my traffic from all download sites is now basically equal to zero. I use to get a lot of hits from palces like altavista, infoseek, hotfiles etc... A game on download.com is lucky if it generates 1000 downloads in a month. Most will get something in the hundreds.

    >Looking back at where my traffic came from in 2000 and comparing it with
    >today, the top 3 sources of traffic are the same now as they were then -
    >Yahoo, MSN, and Google. Only the order has changed.

    Even when my listing was bouncing around between positions 2-4 on google I didn't get much traffic from search sites and the traffic wasn't that well targeted. They've never been a major source of income for me. I do get many sales each month from google, but the majority of my income use to come from download sites, which are now defunct. That may be due to a difference in the kinds of games we make.

    >What, exactly, do the portals control? I sure don't see it. They are just
    >sites like any other, some of them have some good traffic, but they control
    >absolutely nothing about the distribution of online games on the internet.

    Analogously you could say.. what do the record labels control? You can make a song and send it to the radio stations and stores and hope to get airplay and shelf space. But in reality it doesn't really work does it. Why not? Because there is an implicit control. A record label essentially pays the radio station to promote songs. If you're a new artist starting out you simply can't afford to compete. In the case of music its worse than online. There are still opportunities on the web today that a musician doesn't have in the regular cd sales biz, but the market IS trending towards full control. I'd argue that by sheer advertising power real controls a large large portion of game consumers on the internet. I'd argue that they set out to control that audience on purpose. The control comes from the fact that there's a finite number of customers looking to download and buy games, and they have a finite number of games they're willing or able to play each month. If there are 50 ads for realarcade and they already have the client on their machine and one of the 8 games released by real that month suits their needs then you, with your 1 ad that they may or may not have seen are far far less likely to make a sale. It is a competition. And when one player is much stronger financially than the other they can effectively control. I don't know how the market works for solitaire games. But if you were to set up your own web page and release a new little platform game on all the download sites that was a good quality game, comperable to what real is selling, and not advertise it in any way other than your sites and the free submissions you'd go bankrupt in today's market. You'd never sell enough copies to survive. Contrast that with 4 yrs ago. A game released to the major download sites could generate 10's of thousands of dollars in a few months. Those days are over.

    >When I go searching for games you can see some of the portals in
    >sponsored listings, but I don't see much evidence of them in the regular
    >listings so they sure don't have anything approaching a monopoly on traffic.

    There's not complete monopoly yet but it is trending that way.

    >Sure, Yahoo has a prominant link to their game portal on their site and MSN >has the same for their MSNGameZone, but those have been there for years
    >and haven't seemed to stop anyone from going elsewhere.

    This simply isn't true. If it were then I'd be able to see the 10-12x increase in sales I use to see from a submission of a new version of a game to download sites. I don't. So the traffic has in fact moved. And people are.. one way or another "stopped".

    >These portal sites only have traffic as long as they have good product and
    >customer service. The traffic will go elsewhere if they don't.

    This I agree with. But the portals generally do a competent job and they have other mechanisms to keep their traffic such as Real's membership scheme where you can get games a little cheaper.

    >Real only gets traffic because their RealPlayer is on a lot of machines -
    >RealArcade doesn't seem to have much of a search engine presence.

    Nobody visits the website much. They access the games through the realarcade client. The client is used by huge numbers of people because real advertised it heavily. What's the one ad you see front and center on download.com games section and that has been there for the last 4 yrs or so? Realarcade client.

    >BigFishGames must get most of its traffic from its affiliate system and from
    >pay per click. Neither of these constitutes any kind of control on the traffic.

    Well bigfish is smaller but when you add bigfish, real, yahoo, pogo, gamezone, shockwave etc.. together you have a nice set of sites with combined traffic and better service. That has drawn away most of the traffic from sites where developers can get free exposure.

    >Unless one of the search engines themselves makes some kind of exclusive
    >deal where they will only show links to a portal, the control you talk about
    >can never happen.

    You don't need exclusivity to control a market. There is not control in the sense that anyone can still submit a site. There is control in the sense that, if you don't use the portals and you dont already have your own traffic or advertising budget it will be near imposible to make a living wage.

    >The only reason the record labels control distribution of music is because
    >most music is sold in stores and the primary way of learning about new
    >music is over the radio

    It's completely analogous. The only way people learn about new games is by advertising on the net or through sites they already visit that they learned about through advertising. That's your radio. The portal sites essentially are retail stores on the web. I could turn your argument around and say.. how is the music industry controlled. A garage band can pay all the radio stations to play their new single just like the record labels do, and they can go to hmv or whomever and ask the stores to stock their games. There's nothing stopping them. But in reality they don't have the resources to do it.

    - S
     
  7. Anthony Flack

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    It might just be me, but I don't think I've ever discovered a game through advertising. It was always someone posting a mesaage saying "You have to try this!" etc...

    And occasionally a review, when I'm in a review-reading mood.
     
  8. Reactor

    Moderator Original Member Indie Author

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    Very similar experiences here, Anthony. Greg Squire, you hit the nail on the head with your post, as far as I'm concerned.
     
    #88 Reactor, Oct 15, 2004
    Last edited: Oct 15, 2004
  9. svero

    Moderator Original Member Indie Author

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    How many copies did your own game, Platypus, sell online in the 2 years it was up at idigicon through word of mouth before mike introduced it to his and the audiences of affiliates and portals all over the web? Here's a perfect example of a great game, that many people like, that turned out to be a big hit, but sold next to nothing through word of mouth due to lack of exposure. (I admit, in part that has to do with the changes mike made to the game, but I think if mike had made those changes and put the game back up only on idigicon's website sales of platypus would have continued to stagnate)
     
  10. paulm

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    KNau has it spot on with the marketing. Gamers are everywhere, and it's up to the indie to find them. While I haven't read "Guerilla Marketing", I've read "Unleashing the Ideavirus" by Seth Godin (which you can download from the website www.ideavirus.com) and that's a great read. I've also read "Built to Last", and I would suggest that every entrepreneurial indie reads it. However, experience is good as a guide, but don't judge things by experience alone; read around and listen to what other people have to say, as their experiences are different, and are of as much value to your plans as your own ideas.

    I read Dan's .plan on GarageGames and it was a sobering read. While I have no experience with portals (that requires a game, for starters), I can understand his reaction to their arrogance, and agree with the statement that there indies should get informed about their choices. However, I disagree with another idea presented in this thread that states that using portals is against the indie way. That idea is as backward as the idea that an indie game needs to be a puzzle game.

    The biggest weapon indies have in their arsenal is their grey matter. Use whatever choices you have at your disposal, and if they don't match up with your long-term goals, then create your own choices. You need to be prepared to take risks, and follow up as many avenues as humanly possible. Try lots of things and see what works, prune the things that don't work and branch out. Don't become dependent on one avenue like the portals have; that's simply bad business.

    Nothing I'm saying here is new, but it's the reality of the situation. If you have the drive, you'll find a way to get your game out there, whether you bypass the portals or not. Found your own portal; up the quality of your games; inspire a new game concept; straddle the indie-commie divide if you really must (i.e., get experience at a commercial game developer). Just fire your neurons!

    I've found this to be a most enlightening topic.

    Cheers,
    Paul.
     
  11. Anthony Flack

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    Svero - I'm inclined to put that down partly to not "priming the pump"... almost nobody had played the game at all when it was handled through Idigicon. No effort was made to market or sell it online. So nobody was talking about it because the number of people who'd actually played it was probably only in the hundreds. Certainly you need to reach a decent number of people before you can achieve the mythical "critical mass". Which is another reason why I'm inclined not to worry about piracy!

    And the other reason I think, is because I don't think Platypus is really good enough to set people talking. It totally failed to connect with the hardcore shooter fans. Overall I'd say it was an "above average" game, and that's probably just not good enough to blaze a trail with.
     
    #91 Anthony Flack, Oct 15, 2004
    Last edited: Oct 15, 2004
  12. oNyx

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    >And the other reason I think, is because I don't think Platypus is really good
    >enough to set people talking.

    Naaaaah. That's just not true. Over at that Quake3 board I maintain (~21k registered users) it had at least one dedicated thread and got mentioned at least 2 times. That's really not bad (it's the same amount of WoM that Gish got). Oh and over at yakyak it got one dedicated thread and was mentioned at least 16 times. And someone even said it's the best shareware game he ever played :D
     
  13. svero

    Moderator Original Member Indie Author

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    Ok. That may be, but then what people in this thread are saying is, Don't worry about the direction the market is taking, don't worry about big business moving in and controlling the distribution, it won't affect you because if your game is good enough you can sell direct and rely on word of mouth. That's just a naive polly-annish view. It's not realistic. Even a game that sold at hit levels like Platypus, didn't take off on it's own. I can think of other games that were not paying the bills but were, in my view really fantastic titles. I acknoledge that there were other factors in platypus's case, but lets face it, not everyone reading this thread is going to make the next Half Life.

    It use to be that a "good" game could make good sales. I'd argue that a good game nowdays makes near zero sales because of the structure of online distrubution. I've already discussed that I don't think it's very easy to sell direct due to the fact that traffic has largely moved over to large corporate portal game sites. But even when you do get distributed on those sites, the very top games get promoted and those that don't happen to selling the best.. well they're just dropped. There's just not enough virtual shelf space for all of them and so only the best 10-20 games get a real push. If you have 100 games competing to sell on realarcade, and the average top 10 game makes 100k in sales a month, a game that makes a mere 60k in sales.. (should it be promoted) can sell only 1-2k worth because it's not positioned favorably relative to those games pulling in the extra 40k. If you have 10 slots to really push product and you want to make the most money possible, you'll take ten 100k games and push those and let the 60k game sit in the back where it gathers virtual dust and, unseen, it sells less than it's full potential and eventually dissapears. On it's own website and through demos and unadvertised it will sell, but not in the volume you need to pay the bills.

    All I'm saying is that the market is trending to one where, in order to get the kind of traffic you need to live off your game sales, you are faced with a scenario where you essentially have to give up the bulk of your profit or have to invest considerable sums of your own money. Some people have disagreed and stated that the opportunity to get all the customers you need still exists without having to spend tons of money to promote your own site. Personally I don't see that and I'm willing to bet that most of the people who've released their first game in the last year know that what I'm saying is true. (Keep in mind none of this applies to an established business like goodsol, or dexterity etc.. An established customer base and established traffic are powerful sales tools.) If you just released a new game on the download sites chances are you're making less than 30 sales a month. Maybe as little as 1-2 sales a month. In effect it's a bit of a catch 22 because, if you do get distribution you're only making 10-20% of the sale and you have to sell A LOT of copies to make a living wage.

    Some games will sell that many copies of course. (spout - feeding frenzy) But most wont. (sprout - color harmony) If sprout hits a few snags and makes a couple more that dont really catch on.. well... solong. They aren't selling direct so they have nothing to fall back on. A few misses and you're out of money. And even great games can miss! You can argue, but I think Wik and the Fable of souls is a great game. Is it in the top 10 sellers? Maybe maybe not. Lets say it doesn't happen to hit for whatever reason. The public is fickle. There you have a game with fantastic production values that just doesn't make enough money to pay the bills.

    Couple that with the fact that in order to sell your game on a portal it basically *has* to be a top hit to make any money, and you're looking at a market where it's much tougher to make a buck than it use to be. Is it impossible to sell direct today and to market cleverly and still make money on your own? No not quite... I wouldnt go that far. I think it can still be done, but I think it's trending that way. Barring a major change in the direction things are going I'd say that 2-3yrs from now it will be impossible for most games.
     
  14. Diodor Bitan

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    What about games that are in genres the portals don't target? Simulations, strategy, RPGs, that sort of thing.
     
  15. svero

    Moderator Original Member Indie Author

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    I don't think those genres sell very well online these days. In part because game players don't frequent download sites to look for them. I haven't tried to sell an RPG online, but I suspect to make it work you'd want to hit a whole different class of sites and have to do some advertising on more mainstream retail style sites to get at the audience. RPG's and Strategy titles have a whole series of sites dedicated to just those styles of games. I'm not sure if it's enough or could be made to work. It's just something you have to try I guess.

    I think there's definitely a place for a hit casual rpg along the lines of legend of zelda, that would sell well through today's channels though. Popcap in an interview with indiegamer a few years back mentioned they were working on a role playing game. I don't know if the product is still in production or was abandoned.

    I also believe that there's an underserved game market which doesnt really have a site of it's own. Imagine a site that had crimsonland, gish, alien flux, space tripper and only games of that variety. I suspect with the right kind of advertising a site like that could find an audience and do well. In a way the portals have focused on certain styles of games. I realize it was motivated by what was selling, but I think it was also in part due to where they advertised and how they gained their audiences. In a way the new direct2drive site that ign set up is a little like Im describing, except that their titles are too large to be considered good online sales material. I have a dsl connection now, but I'm still not willing to download a gig. I'd like to see a direct2drive that has the same style of content but with games like the one's I mentioned.
     
  16. Rod Hyde

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    I wish! Lots of games that I like, all in one place.

    --- Rod
     
  17. Sirrus

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    It was called PopQuest - heard heard a word about that since...

    As for your comment about the major portals targetting particular styles of gameplay - I think you are absolutely right.
    There is *definately* room for new portals that target genres of games.

    Bringing together Gish, Space Tripper, Alien Flux, etc. is, what I feel, actually going in the right direction. The Casual games market will grow, consumer tastes will grow...time to prepare now...
    Who wants to go in on it? :D
     
    #97 Sirrus, Oct 15, 2004
    Last edited: Oct 15, 2004
  18. Diodor Bitan

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    Yes, but those genres will continue to not sell just as not well as they are not selling today, slipping under the radar of the current Real Arcade offensive, right? Or am I doomed as well? *crosses fingers* :)

    It is true it would be a good thing if a site would serve a certain niche very thoroughly. In fact, IMO, that's what affiliation is going to lead to. To generate profits out of the customers of a certain game, each developer should recommend similar titles, hoping for the affiliate bonus. This way the sites of Gish/Alien Flux/Space Tripper would each promote each other's game, creating a distributed version of your site idea.

    I wish there was a site like amazon.com for games, that would be able to connect peculiar customers with the kind of peculiar games they like, allowing for games in different niches to live side by side. For instance, I wouldn't care a lot for the game you've mentioned, but I would be very happy if I could search for "easy to learn but hard to master small strategy games". Or a site that would start with "if you liked this game we recommend that game" and grow into "people who bought this game also bought that game" (though I'm not sure this is even possible).

    Something like this would make browsing for a game easy enough to make the site a real value. And, more importantly, since the site would target _all_ non-mainstream customers, it could really benefit from mainstream-like marketing. "The best game you never heard of" adds that would pick all the strange fish in the same net.
     
  19. Anthony Flack

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    As much as I'd like to see a site the brought together the afforementioned games and others like them, I would much rather see a whomping big database with some Amazon-style structure.
     
  20. Andy

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    Independent RealOne styled game panel?..
     

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