Games

Video Games in the Era of "Engagement"

Candy Crush is a sugar-coated vision of games as a service.

We’re still a ways away from knowing if Activision’s purchase of King (makers of Candy Crush and all manner of games with “saga” in the title) was a good investment, but I can definitely see the logic behind it. If you take a bigger look at Activision-Blizzard, they’re more than just a Call of Duty factory or an MMO machine. They’re in the business of making experiences that are ongoing services rather than one-off purchases. Buying King gives Activision-Blizzard a shot at cementing that much sought after concept of “engagement” that is currently driving the video game industry as well as the overall technology sector.

Forget GTA or Halo: the masses and the money are on their phones, matching three like there’s no tomorrow. Numbers are always a little hazy, but it’s estimated that King’s games had 533 million monthly active users in 2014. It’s hard to contextualize numbers that big, but if you consider that a traditional disc-based game is considered a huge hit if 10 million people buy it, things start to come into focus. What’s more impressive is that these monthly active users are generating hundreds of millions of dollars of revenue whereas I haven’t touched last year’s Call of Duty since I rented it from RedBox for a day. The player base is massive, they stick around, and clearly they spend money.

It’s another milestone in the evolution of games as a service instead of as a one-off experience. By acquiring King, Activision is getting a huge group of players that habitually play their game, but they’re also accessing a wealth of information. Who plays the game? What other kinds of games do they play? How do they spend their money in the game? What subtle tweaks can be made to influence behavior? All of it can be measured and tested in the span of weeks between updates rather than in years between big budget sequels. After that, the existing game can be optimized and lessons learned there can be applied to other games with similar freemium models (like Hearthstone).

All of this rests on the idea that instead of locking players in with a subscription, you’re able to entice them into continually returning to and interacting with the game. The entire MOBA market is based on this concept. League of Legends, Dota 2, and Activision’s own Heroes of the Storm all adhere to the free-to-play model. What has been a gradual transition in the traditional console/PC market has been the reality from the very beginning of the mobile market. Candy Crush grew up in a freemium world where success is measured by how many users return to play and how many end up buying into the game that is ostensibly free.

Of course, publishers will continue to tout straight sales numbers if they have them. But in the absence of a clear-cut blockbuster, the pivot towards engagement becomes even more important for both the bottom line and for determining the most effective marketing spin. Kotaku’s running tracker of all the ways that Activision is avoiding the release of Destiny's sales numbers is amusing, but I genuinely think that engagement is extremely important to them. Especially in the new phase of microstransations, the most valuable Destiny customer is the one that comes back because they’re the one that spreads the message to friends and the one that continues to spend money on the game. When you reach the point where you can spend more money on dances and expansions than you would on the base game, you’ve turned it into a platform.

On a larger scale, this is the reason why Facebook spent $19 billion on WhatsApp and another couple billion on Oculus: the promise of recurring users on a platform is valuable. The platform owner can iterate quickly, collect massive amounts of behavioral data, and take a cut from other business that want to access to their users. This is why I actually tend to believe Microsoft’s Phil Spencer when he says that explicitly besting Sony’s sales isn’t necessarily the Xbox team’s mission. Obviously this would make Microsoft happy, but the bigger point is to grow the Microsoft ecosystem. More gold memberships, more folks connecting and purchasing things from the store, and more people in the Microsoft world in general is the long term play. Engaged users are as important as one-off sales. It’s why they are giving away Windows 10 for free, and it’s why Nadella is opening up the platform in ways Balmer never would have. Whether the checks come from users buying things directly from Microsoft or whether it’s developers paying Microsoft a cut, the checks all go to Redmond.

In the case of Candy Crush, the checks will go to sunny Santa Monica. Activision’s large bet on King signals that the trend towards focusing on engagement is here to stay. The days of focusing on discrete sales is increasingly behind us. Big companies prize our attention and time because they know that if they get those things, our money will follow.

Pop Ten
Mixed Media
PM Picks

© 1999-2018 Popmatters.com. All rights reserved.
Popmatters is wholly independently owned and operated.