Digital Trends Series – Social Gaming

Today an audience wants to be engaged by brands, rather than simply sold to. Over the next few weeks we will look at five key digital trends that are driving customer engagement to the front of the marketing mind set and discuss why marketers and business leaders need to be taking them seriously.

In this blog we will look at the growth of social gaming.

As with most social media innovations, the concept of social gaming was initially considered a gimmick. But as more and more people have bought into the concept, so brands have increasingly come to see it as a viable and potentially powerful marketing channel. Indeed, according to Facebook, over 40% of its users play social games – that’s more than 200 million people. And Facebook only represents 28% of social gaming activity globally. In fact, a recent report by Inside Network, entitled Inside Virtual Goods: The Future of Social Gaming 2011, predicted that the social gaming industry will be worth US$1.25 billion in 2011.

So what is social gaming?

Social games are played on the internet by several people simultaneously, allowing real-time interaction and sharing of information online

Social networks have transformed gaming from a solo activity, to a global social experience that can be shared with family and friends. The competitive element associated with sharing achievements publicly has also been a key driver.

Social networks have allowed gaming to enter into the mainstream, and brought non-gamers into the space, crossing the gender age divide. Research by Information Solutions Group (ISG), which was conducted in 2010 among 5,000 consumers, demonstrates that social games are also played by people of all ages, with the most popular demographics in the UK being 22-29 (22%), 30-39 (25%) and 40-49 (22%). Even the over-60s are getting in on the act, accounting for a surprising 8% of UK online gamers. In the US, the situation is slightly different, with most the popular age groups being 30-39 (20%), 40-49 (20%) and 50-59 (26%). Here the over-60s account for a staggering 20% of the market.

Tapping into people’s passions to create these games is key to introducing non-gamers into the space, but the popularity of some games may be more surprising than others. Sports games are an obvious choice for developers, but few industry commentators could have predicted farming games to be as popular as they have become. The top three social games, according to ISG, are Bejeweled Blitz, Farm Ville and Mafia Wars.

At it’s peak in March 2010, Farm Ville had 83.7 million users, and in 2009 the New York Times published an article claiming that its users in the US outnumbered real-life farmers by a staggering 60:1. Demonstrating a trend like this can be used to a brand’s advantage. The National Trust in the UK, for example, is offering 10,000 Farm Ville gamers the opportunity to try out their social gaming skills for real at Wimpole Farm in Cambridgeshire (www.my-farm.org.uk), for an annual fee of £30. Every time a major decision is to be made, the farm will go online and explain what needs to be done, and the community can then vote on the outcome. This is a great example of the digital world’s growing influencing on real-life events.

So what are the opportunities for marketers?

In terms of hard, tangible metrics, social gaming has been shown to be highly profitable, thanks to the substantial revenues reaped from the sales of virtual goods and currency – 28% of game players have spent real world money on virtual currency according to ISG, with 32% purchasing virtual gifts. On top of this revenue stream, social gaming enables brands to interact with communities that are guaranteed to have a high level of engagement. Other monetisation options available include: branded content, virtual goods, in-game advertising, display advertising and lead generation.

Over the next 12 months, there’s likely to be further growth in the sector. Social games are becoming more and more sophisticated, and will continue to grow in popularity among consumers. The newest versions will see a blurring of the line between the virtual and real worlds, as developers look to create unique social experiences that tap into users’ interests and hobbies.

We are also likely to see games developers increasingly partnering with relevant brands. For example, in 2010, Playfish and EA Sports joined forces with FIFA to create football game FIFA Superstars. More recently, the developer also launched the American football game Madden NFL Superstars on Facebook. And there’s plenty more innovation in the pipeline, including a trend for brand and product placement in top-end gaming products, such as X Box and PlayStation, which through their live connectivity are becoming powerful social gaming platforms.

Written By: Cece Salomon-Lee