360DigitalInfluence

This past weekend, the New York Times published an article, “Will Zynga Become the Google of Games?” in which author Miguel Helft weaved together the components of every great start-up story: a confident visionary, early doubters, copycat competition, eventual success, and the forward-looking, “What’s next?”

While I enjoyed reading his article and am pleased games are getting the attention they deserve, the information mainstream journalists present their readers on the topic can be misleading.  Often this is because they’re comparing apples to oranges, restating known facts, or asking extremely broad and generic questions.

In an effort to create a clearer picture, here are three points the reader should know:

1.    Games are not passively-consumed like movies, nor are they large-scale social networks
Most often journalists describe online games as pure entertainment with no social value or influential connections, or they compare them to a half-billion member, multi-billion dollar social network.  Though this is an effort to try and ground the reader, I find it somewhat ignorant to the actual value online games bring to the table.  Personally, I think of games as a hybrid of the two.  Unlike movies, games require interaction and decision making and unlike social networks, games don’t offer a seemingly limitless world of members, intimate connections, and a multitude of features. Online games actually lie within a spectrum, somewhere in between traditional, on-screen entertainment and the social networks we are familiar with today.

2.    The realization that successful games can generate lots of money is old news.
Let’s look at last holiday season’s biggest blockbusters as an example.  Avatar and Modern Warfare 2 both posted record sales numbers for their industry.  However, if we take a closer look, we can actually see how far online games have come.  By adding the production costs and advertising budgets (Avatar: $380M and MW2: $250M) and divide from the profits, we see that for every dollar invested in Avatar the return is $2.60 and for Modern Warfare 2 the return is even larger, $3.00.

Image from Business Management

If we go back to 2007, the most popular game, Halo 3, brought in $170 million in sales in the first 24-hours, beating Spiderman 3 on both opening day ($59M) and over its first weekend ($151M).  It should not come as a surprise when a gaming company like Zynga is able to bring in such high profits.  Instead, the story should be the unique way they did it, through investors, micro-payments and innovative advertising.

3.    Asking whether Zynga “will be the Google of games” or “as big as Facebook” is a pointless question.
If the writer means this in the literal sense, than the resounding answer is “No.”  Games are simply one form of entertainment and social interaction.  Meanwhile the value Google and Facebook offer is not confined within this space and users visit these hubs for a myriad of reasons.  Finding out if the number of visitors and page views of a gaming site will ever equal the traffic statistics of Google or Facebook is to a degree, meaningless.

If Mr. Helft meant to ask “Will Zynga become a household name and the go-to brand for online gaming?” I would answer that it is possible, but they still have a ways to go.  We all know what Zynga’s done well:   used social networks to build in-game relationships, created low barriers to entry to lure in the average internet user and optimized micro-payments.

Here are three challenges Zynga will need to overcome to reach the next level:

Zynga’s games are experiencing the same stigma console games only just recently escaped.
While video games will always be for geeks, celebrities who are die-hard players have legitimized a generation gamers.   It doesn’t seem as nerdy to play the latest NFL Madden game when you see professional athletes on ESPN talk trash to each other about who is a better (game) player.  If Zynga hopes to reduce the embarrassment people feel when playing their games, they will need to find their own way to make playing their games “cool.”

Users will tire of the same game concepts and want new experiences.
Games like Farmville are enjoyed by so many casual players because they’re simple to play and easy to drop in and out.  However, players will naturally grow tired of the same two-dimensional, goofy graphics and repetitive gameplay and will want the developers turn the experience up a notch.  Even if players are still harvesting Farmville crops by clicking the mouse, the game could be set in a 3D world, with actual farm sounds and environmental effects like rain or frost.  Though realism may not be Zynga’s goal, they’ll need to find a way to upgrade their current game lineup before their players burn out.

Zynga  needs to encourage user interaction and content creation
Creating communication channels between players is key to sustaining gameplay overtime.  Even if in-game communication is limited, players will find each other on forums to discuss the best ways to advance in the game.  Super users, game bloggers and review sites influence other players about where to go and what to do.  Zynga cannot continue to have public relations slip ups and instead, should empower their players to converse with each other and create their own content—moving their players up Forrester’s Social Technographics Ladder.

Again, I think Mr. Helft’s article was a great story on Zynga and the high-profile of the New York Times certainly exposed online gaming to a broader audience.  I just wish journalists in general would refrain from comparing the online gaming industry to unrelated internet giants,  acting surprised at how big the gaming industry has become, and asking, “Is this the next Google?”