Saturday, October 24, 2009

What should Zynga do next?

Ok, so it's not too difficult to look at a successful company and describe some of the smart things they've done and why they might be considered significant; much harder to say what they should do next. Here's my attempt to map out four next steps for Zynga:

1.) Enable interactions between games
The logical step on from cross-promotion - hinted at by their dynamic CTAs ("Did you milk the cow? Take a break with a milkshake in Café World!") - Zynga's portfolio of games is just crying out to be joined up at a more molecular level. What better way to increase reach and dwell time than to start create rich interconnections and dependencies between the games, enabling the pigs raised on your FarmVille farm to be dispatched to your Café World café (possibly via your Abattoir City slaughterhouse - you can have that idea for free guys ;-) You wouldn't necessarily need to own all the businesses yourself - your network of friends could form a mini cooperative (or cabal, should you be so inclined) with one venture supplying another (not hard to see how Mafia Wars might fit into this setup).

2.) Prioritise development of mobile apps
Zynga have already made a start with iPhone apps for four of their titles, but if I were them, I'd be inclined to bump mobile app development right to the top of my to do list. They wouldn't need to be Rolls Royce ports of the desktop browser games - pared down versions which enabled you to harvest your crops or take your dish off the stove would be sufficient at this stage. There's obviously huge potential for push notifications announcing calamity (or opportunity) in your game world and Apple allowing free iPhone apps to use in-app payments clearly presents some attractive revenue possibilities.

3.) Fill in the obvious gaps in its portfolio
Accusations of derivative / copycat games are rife in the social gaming space at the moment (Psycho Monkey has sued Zynga, Zynga has sued Playdom as well as a number of other developers) so Zynga would need to tread carefully in filling in some of the holes in its current portfolio. One of the most obvious gaps is pets, which are big business in the social gaming world, as Pet Society, Neopets, My Fishbowl, Animal Paradise and countless others will testify. If I was in charge of the 'what next?' list at Zynga, a pet game would be somewhere near the top...

4.) IPO (or get bought by EA)
Both have been rumoured, with the former probably more likely than the latter. Either way, the next 6 months look like a good time to capitalise on its rapid ascendancy and position as market leader. Who knows what the landscape will look like in another couple of years time?

Having said all that, they do seem to be doing ok without my advice... ;-)

Tuesday, October 20, 2009

6 reasons why Zynga is truly game-changing

Chances are you haven't heard of Zynga. However, if you're a Facebook user (and 19 million UK Internet users reportedly now are) then you may well have played one of their games and have subliminally registered their 'powered by Zynga' logo (a silhouette of the founder's bulldog). With 45 million daily active users (yes, daily!) across their portfolio of games and an estimated $150 million in revenue this year, they have rapidly become a very big fish, not just in gaming, but in the online world more generally.

This astonishing rate of growth is best exemplified by their Facebook app Farmville, a real-time farm simulation game which launched in June 2009 and now boasts over 50 million monthly active users, making it the most popular game on Facebook.

So, what's their special sauce, magic ingredient? Here's six reasons why Zynga is truly game-changing:

1.) Smart leveraging of your social graph (it's only fun with friends!)
One of the big draws for Facebook app developers is the ability to leverage users' social graphs, not only to enable social play, but to encourage the viral spread of the application. Most early apps which attempted to exploit this tended to be crude 'you're it' type games (e.g. Zombies) which achieved a lot of installs but didn't offer the user any real depth of gameplay and soon became regarded by many as tantamount to spam. What Zynga have done (although there's undoubtedly still some residual app invite fatigue for them to overcome) is to make games which offer more depth than the one-trick pony 'you're it' games and provide a more nuanced reward mechanic, with genuine ongoing incentivisation for users to expand their 'neighbourhood' of friends via gifts (cannily limited to one-per-day-per-friend), offers of help/employment, and rewards based on acts of citizenship). In fact, those interactions are so key to the game mechanic, that it's really only fun with friends, as Alice recently bemoaned.

2.) Stickiness through Tamagotchi-style plate-spinning
Part of the reason Zynga's daily reach is so high is that it's games are invariably 'high-maintenance'; in order to maintain your hard-won status and progress, you must return on at least a daily basis (and are invariably rewarded for doing so more often). This model might prove frustrating on a more traditional gaming platform, where you have to find time to fire up the console and load the game, but works perfectly on Facebook where frequent repeat visits are already the order of the day, largely driven by communication tasks (messaging, status updates etc.) There's both carrot and stick in this equation as neglecting your Zynga game will result in dead crops, spoilt food and unhappy customers just as surely as regular visits will send your revenue and status skyward.

3.) Persuading users to make micropayments
Perhaps the most impressive thing about Zynga is the amount of revenue it is now generating. Building a sizeable web audience is one thing; successfully monetising it is quite another (hello Twitter!) People's willingness to part with real-life cash for virtual goods has been well established by immersive 3D environments like Second Life and WoW, but it's testament to the engagement that Zynga's casual games engender, that once users virtual currency runs out, a sizable number of them are willing to dip into their pockets to keep progressing.

4.) Exploiting the endowment effect
Another genius element of Zynga's game design is the way in which they exploit some very basic aspects of human psychology, in particular the endowment effect. Whereas many game worlds are populated with alien objects for you to navigate or obliterate, with the main protagonist your only point of identification, Zynga's games tend to give you immediate ownership of a domain in which you very quickly start to take civil pride. You care how your room/cafe/farm/theme park is perceived because it's very definitely yours (a point reinforced by the status boasts / screengrabs you are encouraged to publish to your wall and your friends' homepages).

5.) Easily repurposable game-engine
One of the best things about Zynga's recipe for success is how repeatable it is. The basic game engine for CafeWorld is identical to the one powering FarmVille, YoVille and Roller Coaster Kingdom. The ability to apply this model to new domains, and in so doing, reach new audiences (as well as extended reach/time spent with existing audiences) is a game developers dream.

6.) Effective cross-promotion / upselling of its other games
With 17 Facebook games now in its portfolio, Zynga does an extremely good job of upselling its other titles from within the individual games. In addition to a carousel running underneath each game promoting their big ticket releases, dynamic CTAs are also inserted above the Flash app (e.g. in Farmville: "Did you milk the cow? Take a break with a milkshake in Café World!")

It's worth saying that Zynga aren't the only company pushing the envelope in online social gaming at the moment (check out Playfish), they just happen to be doing it bloody well.