Gdc2013 magid-play span-game-biz-models

Video Game Business Models and Presented at:

Emerging Trends Among Consumers
Commissioned by:

©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
1 ©2013 Visa and Magid Associates

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


(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.


(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.
U.S. Total Non-
Demos Population Contacts Gamers Gamers
(N=743) (N=601) (N=115)
% % % %

13-17 6 6 7 1
18-24 9 8 9 6

Males
25-34 12 12 14 3
35-44 11 11 12 11
45-54 12 12 10 22
13-17 6 6 6 3

Females
18-24 8 8 8 7
25-34 12 12 12 9
Gamers exist in all 35-44 11 11 11 15
demographic groups, but are 45-54 13 14 11 24
slightly more likely to be White 64 64 62 77
young, 13-34 years old males. Hispanic 16 17 18 10
Race

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


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)

Men Women

49%
45%

25%
18%
15%
7% 9%
4% 3% 4%

Console Smartphone Tablet Computer Handheld


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

82%
77%
72%

Total Men Women
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

21 Million
Gamers

13 Million
Gamers
Free-To-Play
Pay-To-Play
Equal

110 Million
Gamers


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

$20.00

$15.00
$13.38

$10.00

$4.84
$5.00

$0.00
Men Women

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

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

$20.00
$17.43

$15.00
$12.85

$10.00
$6.91 $6.89
$6.26
$5.00

$0.00
13-17 18-24 25-34 35-44 45-54


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

$35.00
$30.54 Men Women
$30.00

$25.00
$19.94
$20.00

$15.00

$10.00 $9.38 $8.60
$6.66 $5.93
$5.03 $4.04 $5.16
$5.00 $3.95

$0.00
13-17 18-24 25-34 35-44 45-54


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

$35.00
$30.54
$30.00

$25.00

$20.00

$15.00

$10.00

$5.00 $3.95

$0.00
Men Women


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)

$40.00
Free-To-Play is skewed lower
$35.00 by the 46% who currently are
$30.00 spending zero. $28.86

$25.00

$20.00

$15.00

$10.00 $9.15

$5.00

$0.00
Free-to-Play games Pay-To-Play Games

14 How much money did you spend on ________?

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

$50.00
$45.00
$40.00
$34.53
$35.00
$30.00
$25.00 $22.59
$20.00
$15.00
$10.00
$5.00
$0.00
Men Women

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

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

$50.00
$46.69
$45.00
$40.00
$34.29
$35.00
$30.00
$22.81 $23.79 $24.39
$25.00
$20.00
$15.00
$10.00
$5.00
$0.00
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

$60.00 $58.26
Men Women
$55.00
$50.00 $48.60
$45.00
$40.00 $37.52
$36.74
$35.00
$30.00 $27.29
$25.00 $23.61 $25.18
$20.29
$20.00
$15.00 $13.24
$10.00 $8.27
$5.00
$0.00
13-17 18-24 25-34 35-44 45-54


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”

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

Has a wider variety of games 22 25 40 13
Has the games your friends are talking
21 18 41 19
about
Has the games that are more fun to play 20 19 49 12

Allows you to play with your friends 19 17 52 13

Has better quality games 13 35 40 13
Has the games that get better critic
13 26 41 20
reviews
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
18 statements?

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

Strongly agree Agree Neutral Disagree Strongly disagree

Money is more of a concern to you now 41 35 17 43

You can control your spending better on
35 42 20 2
1
free-to-play games
The free-to-play games are more
available now on all your gaming 16 39 37 53
systems
The free-to-play games are as good as
16 35 35 11 2
pay-to-play games now

Using the scale of 1 to 5, where “5” is “strongly agree” and “1” is “strongly disagree,” how much do you agree with each
19 of the following in your decision to play more free-to-play and less pay-to-play games?

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

Strongly agree Agree Neutral Disagree Strongly disagree

The gaming experience is better on pay-
24 35 33 45
to-play games

The best games are always pay-to-play 18 31 40 7 4

You need pay-to-play games on the
13 25 44 9 9
devices you own

You have more money now to spend on
9 22 40 16 13
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
20 of the following in your decision to play less free-to-play and more pay-to-play games?

Key Factors In The Purchasing Decision When Buying Games

Major consideration A consideration
Neutral Not a consideration
Not at all a consideration

The price 39 36 17 2 5

The genre of the game 31 39 20 46

Friends’ recommendations 23 47 20 46

The ease of buying the game 15 39 28 8 9

User reviews 13 42 25 9 10

Whether I can play it with my friends 12 30 29 12 16
The ranking of a game you see or read
10 34 30 12 13
about
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?

Top Genres Played
Strategy 43%
Arcade Games 38%
Games on a smartphone or tablet 33%
First or Third Person Shooter 31%
Adventure games 29%
Racing Games 27%
RPG 27%
Action/Fighting Games 26%
Sports Games 24%
Free web based casual games 21%
Games on social networking sites 20%
Simulation Games 17%
Music / Rhythm Games 16%

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

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

Men Women

47%
35% 37% 33% 35% 33%
23% 21%
15% 15% 13%
13%

First Or Third Adventure RPG Racing Games Action/Fighting Sports Games
Person Shooter games Games


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

Men Women

46% 43%
32% 27% 31%
25%
16%
9%

Arcade Games Games on a Free web based Games on social
smartphone or tablet casual games networking sites


Robert M. Crawford, Ph.D. Robb Lewis
Vice President, Research Director of Marketing and
One Research Center Consumer Products
Marion, IA 52302 PlaySpan
bcrawford@magid.com robblew@visa.com @robblewis

Download Report -
playspan.com/gdc2013

Extra Slides



 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?


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

$35.00

$30.00
$26.11
$25.00

$20.00

$15.00

$10.00

$5.00 $4.39

$0.00
Men Women


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

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

Basic Computer 41 9 13 20 16

Computer 25 10 15 25 18

Smartphone 15 14 14 23 33

Console 10 14 19 23 33

Tablet 10 14 27 21 26

Handheld 10 24 24 43

How many hours a week do you spend on ______?

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

Free-to-Play games Pay-To-Play

49%
36% 39%

22%
10% 8% 9%
3% 1% 5% 2% 4% 5% 5%

20+ 16-20 10-15 5-9 Less than None DK/NS
5

30 How many hours a week do you spend playing _______?

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

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

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

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

21%
10%
4% 4% 2% 2% 1%

Call of Halo 4 Minecraft World of Diablo III StarCraft Guild
Duty Warcraft II Wars II

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

Gdc2013 magid-play span-game-biz-models

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