Gdc2013 magid-play span-game-biz-models

©2013 Visa and Magid Associates

Video Game Business Models and

Emerging Trends Among Consumers

Commissioned by:

Presented at:

1 ©2013 Visa and Magid Associates

Methodology

Frank N. Magid Associates conducted an online survey in December

2012 that focused on the attitudes and behavior among a broad range of

gamers.

Using a highly qualified sample provider, Research Now, Magid

surveyed a representative sample by gender, age (13-54 years old) and

ethnic background. A screening question (Which platform do you own

and use regularly for gaming?) was used to identify current gamers.

Those who did not select at least one of the platforms screened out.

The overall incidence (the chance of finding a gamer) of this study was

81%, up from 75% in the previous research. The incidence of gamers is

highest among 13-54 men (96%) and lowest among 45-54 women

(67%)

Therefore, within the United States population (13 -54 years old)

144,000,000 are playing games on some type of platform.

Among gamers, 52% are men and 48% are women.

Notes: Unless otherwise stated all data showed was sourced from this survey. Any references to specific game titles are used solely for representing the consumer provided information and does not imply product endorsement


Are You Prepared For This?

The current gaming model strongly favors Free-To-Play and the

momentum also favors Free-To-Play. Two-thirds of all gamers now prefer

the Free-To-Play model with only one in ten preferring Pay-To-Play.

Where is the momentum in your games? Are you using today or considering

moving towards a free to play game model or possibly a hybrid model

combining free to play with a subscription package premium option?

Pay-To-Play has the image of a “better experience” but is at parity on all

other game images. In fact Free-To-Pay games are as likely named over

Pay-To-Pay when it comes to:

Having a wide variety of games

Games that allow you and your friends to play

Games that are more fun


Are You Prepared For This? (continued)

Free-To-Play gamers named “money - value” as the top reason for

playing.

How can you make the gaming experience easier when it comes to

Free-To-Play transactions?

Quality is a unique trait for Pay-To-Play.

How can you maintain quality over increased competition from

Free-To-Play? Are your pay-to-play games competing by claiming better

graphics and quality? These are no longer differentiators - Storyline and

gameplay experience matter most – they always have.


Are You Prepared For This? (continued)

The time is rapidly approaching when gamers will spend more money on

Free-To-Play. This will happen when:

More consumers become gamers;

The number of Free-To-Play gamers increase;

These players increase in the number of micro-transactions;

An easy to purchase model in place that increases the average spend.

Based on the current assumptions, when the average spent on Free-

To-Play moves slightly from $10 to $17, then Free-To-Play “wins” on

the dollars spent per year.

What model are you exploring to make Free-To-Play an easy model to

connect to those not spending money?


The Gaming Market Continues Its Rapid Expansion – More Than 8 in 10 Consumers Are Now Gamers. This Growth Can Be Attributed To Growth In Smartphones As A Popular Gaming Platform.

Gamers exist in all

demographic groups, but are

slightly more likely to be

young, 13-34 years old males.

Demos

U.S.

Population

Total

Contacts (N=743)

Gamers (N=601)

Non-

Gamers (N=115)

% % % %

Ma

les

13-17 6 6 7 1

18-24 9 8 9 6

25-34 12 12 14 3

35-44 11 11 12 11

45-54 12 12 10 22

Fe

ma

les

13-17 6 6 6 3

18-24 8 8 8 7

25-34 12 12 12 9

35-44 11 11 11 15

45-54 13 14 11 24

Ra

ce

White 64 64 62 77

Hispanic 16 17 18 10

Black 12 11 12 4

Asian 5 5 5 3

Other 3 3 3 5


Smartphones Now Equal To Consoles As The Preferred Gaming Platform (Single mention – preferred gaming platform)

35% 34%

11% 6%

3%

Console Smartphone Tablet Computer Handheld


49%

25%

7% 9% 3%

18%

45%

15%

4% 4%

Console Smartphone Tablet Computer Handheld

Men Women

While The Console Still Reigns Top Game Platform For Men, Women Prefer The Smartphone And Tablet As Their Gaming Platform By Almost Double Over Men (Single mention – preferred gaming platform)


77% 72%

82%

Total Men Women

The Momentum In Gaming Is Towards Free-To-Play Games, 110 Million U.S. Gamers Are Now Playing More Free-To-Play Games, With Women Leading The Movement Towards This Model

Which of the following phrases best describes you?

• You are playing less free-to-play and more pay-to-play games

• You are playing more free-to-play and less pay-to-play games

• I play both types of games equally


The Majority Of Gamers Are Now Playing Free-To-Play Games

110 Million Gamers

13 Million Gamers

21 Million Gamers

Free-To-Play

Pay-To-Play

Equal


How much money did you spend on Free-to-Play games last month?

$13.38

$4.84

$0.00

$5.00

$10.00

$15.00

$20.00

Men Women

Men Spend Nearly Three Times More Than Women On Free-To-Play Games.



$12.85

$17.43

$6.91 $6.89 $6.26

$0.00

$5.00

$10.00

$15.00

$20.00

13-17 18-24 25-34 35-44 45-54

Young (13 – 24) Are Driving The Overall Average Money Spent On Free-To-Play Games.



$19.94

$30.54

$9.38 $8.60 $6.66

$5.03 $3.95 $4.04 $5.16

$5.93

$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

$35.00

13-17 18-24 25-34 35-44 45-54

Men Women

Young Men (13-24) Dominate Women In Average Money Spent On Free-To-Play Games



$30.54

$3.95

$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

$35.00

Men Women

18 – 24 Year Old Men Are Spending Nearly Eight Times What Women Do Per Month on Free to Play Games


How much money did you spend on ________?

$9.15

$28.86

$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

$35.00

$40.00

Free-to-Play games Pay-To-Play Games

However, The Average Money Spent On Pay-To-Play Pay-To-Play Games Is Three Times Greater Than Free-To-Play (Based on those play each type of game)

Free-To-Play is skewed lower

by the 46% who currently are

spending zero.


How much money did you spend on pay-to-play games last month?

$34.53

$22.59

$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

$35.00

$40.00

$45.00

$50.00

Men Women

Men Are Driving The Total Dollars Spent On Pay-To-Play Games



Pay-To-Play Games Monthly Average Remains Steady Among 25 To 54 Year Old Gamers

$34.29

$46.69

$22.81 $23.79 $24.39

$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

$35.00

$40.00

$45.00

$50.00

13-17 18-24 25-34 35-44 45-54



18-24 Year Old Women Outspend Men On Average Money Spent On Pay-To-Play Games

$48.60

$37.52 $36.74

$27.29

$23.61

$13.24

$58.26

$8.27

$20.29

$25.18

$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

$35.00

$40.00

$45.00

$50.00

$55.00

$60.00

13-17 18-24 25-34 35-44 45-54

Men Women


Little Differences In Imagery Exist Between The Types Of Games Other Than “Better Quality” Is Owned By Pay-To-Play. Parity Exists Between The Game Format On The Image Of “More Fun To Play”

13

13

19

20

21

22

26

35

17

19

18

25

41

40

52

49

41

40

20

13

13

12

19

13

Has the games that get better criticreviews

Has better quality games

Allows you to play with your friends

Has the games that are more fun to play

Has the games your friends are talkingabout

Has a wider variety of games

Free-to-play MMO/Pay-to-play Both equal Neither

Regardless of which gaming model you typically play (free-to-play and pay-to-play games,) we would like you to

compare each on the following elements. Please check the box that you feel the model the statement best

describes. You can also check both or neither. Which gaming models is best described by the following

statements?


Over Half Of Free-To-Play Gamers Feel Their Games Are As Good As Pay-To-Play Games

Using the scale of 1 to 5, where “5” is “strongly agree” and “1” is “strongly disagree,” how much do you agree with each

of the following in your decision to play more free-to-play and less pay-to-play games?

16

16

35

41

35

39

42

35

35

37

20

17

11

5

2

4

2

3

1

3

The free-to-play games are as good aspay-to-play games now

The free-to-play games are moreavailable now on all your gaming

systems

You can control your spending better onfree-to-play games

Money is more of a concern to you now

Strongly agree Agree Neutral Disagree Strongly disagree


The Image Of “A Better Experience” Is Drawing Gamers To Pay-To-Play Games

Using the scale of 1 to 5, where “5” is “strongly agree” and “1” is “strongly disagree,” how much do you agree with each

of the following in your decision to play less free-to-play and more pay-to-play games?

9

13

18

24

22

25

31

35

40

44

40

33

16

9

7

4

13

9

4

5

You have more money now to spend ongames

You need pay-to-play games on thedevices you own

The best games are always pay-to-play

The gaming experience is better on pay-to-play games

Strongly agree Agree Neutral Disagree Strongly disagree


Key Factors In The Purchasing Decision When Buying Games

Using a scale of 1 to 5 where “5” is “a major consideration” when you buy a game and “1” is “not at all a consideration,”

how much do each of the following effect your purchase decision?

10

12

13

15

23

31

39

34

30

42

39

47

39

36

30

29

25

28

20

20

17

12

12

9

8

4

4

2

13

16

10

9

6

6

5

The ranking of a game you see or readabout

Whether I can play it with my friends

User reviews

The ease of buying the game

Friends’ recommendations

The genre of the game

The price

Major consideration A consideration

Neutral Not a consideration

Not at all a consideration


Which of the following video game genres do you play on _______?

16%

17%

20%

21%

24%

26%

27%

27%

29%

31%

33%

38%

43%

Music / Rhythm Games

Simulation Games

Games on social networking sites

Free web based casual games

Sports Games

Action/Fighting Games

RPG

Racing Games

Adventure games

First or Third Person Shooter

Games on a smartphone or tablet

Arcade Games

Strategy

Top Genres Played



47%

35% 37% 33% 35% 33%

13%

23% 15% 21%

15% 13%

First Or ThirdPerson Shooter

Adventuregames

RPG Racing Games Action/FightingGames

Sports Games

Men Women

Men Play Shooters Three Times More Than Women And Over Twice As Much Play Time On RPG, Action And Sports Genres Than Women



32% 25%

16% 9%

46% 43%

27% 31%

Arcade Games Games on asmartphone or tablet

Free web basedcasual games

Games on socialnetworking sites

Men Women

Women Are More Than Three Times More Likely To Play Games On Social Networking Sites Compared To Men


Robert M. Crawford, Ph.D.

Vice President, Research

One Research Center

Marion, IA 52302

[email protected]

playspan.com/gdc2013

Download Report -

Robb Lewis

Director of Marketing and

Consumer Products

PlaySpan

[email protected] @robblewis

http://www.playspan.com/gdc2013

mailto:[email protected]


Extra Slides


Are You Prepared For This?

Gamers are becoming more mainstream each day. Currently more than

eight in ten consumers can be classified as a gamer. Gamers exist

within all demographics groups – this is not a 13-34 year old male

experience.

Does your game account for the changing demographics of the gamer?

The mobile platform is beating the more traditional platforms (computer

and consoles) for a gamer’s primary play. Women have fueled this

growth.

Are you in the business of selling games or selling the platform and the

game?

Gamers who prefer the smartphone platform, have almost completely

left MMO as a gaming model.

Can you survive by focusing on the young male demographic driven by

console and computer platforms? Are you evaluating developing games with

business models that reach mobile free to play?



$26.11

$4.39

$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

$35.00

Men Women

13 – 24 Year Old Men Are Spending More Than Six Times What Women Do Per Month On Free-To-Play Games


Hours Spent On Platforms Playing Games (Based on those who use platform most often)

How many hours a week do you spend on ______?

10

10

15

25

41

10

14

14

14

10

9

24

27

19

14

15

13

24

21

23

23

25

20

43

26

33

33

18

16

Handheld

Tablet

Console

Smartphone

Computer

Basic Computer

20+ 16-20 10-15 5-9 Less than 5


How many hours a week do you spend playing _______?

3% 5% 10%

22%

49%

5% 5% 1% 2% 4% 8%

36% 39%

9%

20+ 16-20 10-15 5-9 Less than5

None DK/NS

Free-to-Play games Pay-To-Play

A Surprising Four In Ten Gamers Admit To Not Playing Pay-To-Play Games


If you could keep one free-to-play game, which one of the following would it be?

6% 6% 6% 5% 3% 2% 2% 1%

No Free-To-Play Game Stands Out As One They Would Really Miss


If you could keep one paid title, either a full game price or subscription MMO, which one of the following would it be?

21%

10% 4% 4% 2% 2% 1%

Call ofDuty

Halo 4 Minecraft World ofWarcraft

Diablo III StarCraftII

GuildWars II

Call Of Duty and Halo 4 Are Most Likely The Pay-To-Play Games That Would Be Missed

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