SuperData Research's Joost van Dreunen discusses how to localise for this lucrative region
Back in the early 2000s, life was simple. Small design studios in Western markets self-published through their website and charged $20 for a 50MB downloadable time-management game. Even moderate sales would allow building out any designer’s dream studio and hire a substantial team.
Soon, the market’s supply-side became saturated because of the low barriers to entry. This put studios in a downward spiral, as they were forced to lower prices. To remain sustainable, many of them looked at countries like India, Russia and China, where programmers would cost roughly a third of their Western counterparts. Asia, to many game makers, served as a place to reduce costs.
Today, Asia is the largest growing consumer market for games.
With mobile reaching $25 billion (£17.3bn) in worldwide revenues last year, the market for ‘easy to learn, difficult to master’ games continues to show strong growth. Particularly so in countries like China, Japan, South Korea and, more recently, India. Markets like North America and Europe traditionally offer players that convert better and spend more on average.
In December, the average spend of a monthly active player on mobile in the UK was $1.20 (£0.83) compared to $0.68 (£0.47) in China. The audience in Asia is enormous; since 2011 the addressable audience there has more than doubled, and there are 1.3bn monthly active mobile players.
Satiating the massive appetite of an audience that size demands a never-ending search for content.
Beast in the east
Big publishers in the Asian market, like Tencent, increasingly rely on Western game makers to provide them with new and innovative games. This Chinese titan has invested over $1.5bn in other game companies since 2008, of which 89 per cent was used to invest in or acquire Western firms. The Chinese version of Plants Vs Zombies is a prime example of how successful this can be.
Tencent’s global strategy concerns itself only with two key pieces: technical barriers to entry and cultural sensitivity. It is the latter that poses a real challenge.
Based on analysing the preferences and best practices of game publishing in China, Tencent looks for games that suit its primary consumer market. Generally, the firm will make a small investment of as much as several million dollars, which comes with a list of specific instructions on what monetisation hooks to put into the game and how to optimise its game mechanics.
Most importantly, the game will then also be localised for the Chinese market. By doing so, Tencent guarantees itself a front row seat on all the internal analytics and can oversee the game’s release in China to ensure a maximize chance of success.
To play into this ravenous demand, it makes sense to consider who’s going to want to play your game and determine at the onset what informs the overall design agenda.
In considering your next project, think about how to develop for a global audience and specifically about how to appeal to audiences that are of interest to major firms.
Because the Tencents of the world will always be looking for new and innovative content to publish on their platform.
Article originally published in Develop: March 2016 issue.