Casual Retail: MumboJumbo CEO Mark Cottam on the Benefits of Store Shelves
January 18, 2007 Page 1 of 3
Game developer and publisher MumboJumbo has taken the initiative in bringing casual games from the downloadable market into the retail sector, licensing titles both internally and externally for distribution on store shelves, including Super Collapse! 3, Cubis 2, and their proprietary hit franchise, LUXOR.
Gamasutra's Frank Cifaldi sat down with MumboJumbo CEO Mark Cottam to find out how this unique venture is working out, and to detail the market segment that purchases casual games from brick and mortar stores.
Gamasutra: MumboJumbo is taking so-called "casual" games, which are typically sold exclusively through online channels, and putting them on retail shelves. Is anyone else doing that on your kind of level?
Mark Cottam: Casual games at retail grew out of the digital download world. Until recently, there was really no one else that was focused on this content, packaging it up and bringing it to retail. Obviously, the term "casual games" has become more common so we see a lot of companies looking at the category, trying to figure out what it is that works, and looking to bring content out under the casual games heading. At this point, MumboJumbo is the dominate publisher of casual content at retail. I would expect that in 2007 we'll see other companies come into this area and truly compete with us not only for shelf space, but also for licensing of titles.
GS: If I'm not mistaken, you published Myth III?
MC: Not exactly, we developed the game.
GS: That was obviously not what we consider a casual game; it's sort of a full-priced, regular game. Is that something you still do, or…?
MC: If you go back to the beginning of the company in 2000, MumboJumbo started as a developer of action, or AAA type, content working for companies like Take-Two. We specifically developed Myth III for Take-Two and they actually published it. We did work also for Electronic Arts and Dreamworks. In 2003 we saw the emergence of the casual game category. We knew we had to develop an expertise in the categroy, even though we didn't understand what exactly made a game “casual.” So in the middle of 2003 we converted our development efforts to casual games, and now all of our development resources are committed exclusively to casual games.
GS: All right. So that's just on the development side, but as far as publishing, you obviously publish – as far as retail anyway, and perhaps online also – games that were developed outside of MumboJumbo, right?
MC: We do. We've branded MumboJumbo as a developer and publisher of "premium casual games." Everything that is either developed internally or being licensed and published into retail falls into the casual game category, and a lot of our content does come form the other developers in the casual games space.
GS: I see. So let's talk about sales for a little bit. I'm kind of wondering about the sales of certain titles in their retail versus online incarnations. Are we seeing certain trends? Do certain types of casual games sell better on store shelves?
MC: As the market started to grow on the download side in 2003 and we started working that content into retail, most of what we brought into retail was the top selling games in the download community. Games like Bejeweled, Super Collapse and Jewel Quest, and our own brand, LUXOR. We were really taking the top performing products and putting them into retail. In the early stages, we saw a direct correlation between how well the title did online and how well it did at retail. And I believe in the early days that the download side, the whole kind of digital arena, created the awareness for these brands at retail. There was a lot of brute force marketing in the download space, due to sites like Yahoo!, RealArcade, MSN and Pogo, making these games very visible. As a result, I think consumers became aware of the brand, and then as they went into retail and started seeing those same brands, they began picking them up off the shelf.
Super Collapse! 3
GS: Okay! Well, my next question was along the lines of 'How do you sell these retail games without the immediate demo exposure,' but what you're telling me is that your basis for publishing these games is based on brand recognition already existing. Is that accurate?
MC: That's correct. It certainly was how we launched the casual game category into retail, by bringing the top brands to market. And what we found was that there really were two distinct buyers. There was a buyer that was comfortable going online, downloading a file and paying for it over the Internet, and then there was another customer that was still not comfortable playing games over the Internet. The consumer may have become aware of it coming out on the Internet, or through the recommendation of a friend, but they were not really an online customer. We still get a tremendous amount of mail delivered by post; handwritten letters from customers that don’t have access to the Internet or don't know how to download a file, but who want more of the games that they've been able to find at Wal-Mart, Target or Best Buy. We still see that although the world's becoming more connected, there's a huge part of the population that is not, or doesn't feel comfortable downloading content and transacting over the Internet.
GS: So for this sort of audience, do you offer an actual printed catalogue for them to purchase games from?
MC: Yes, we produce and print a physical catalogue quarterly which we both distribute at tradeshows and mail to our customers. I think you would be surprised at the number of customers who actually purchase games through mailorder.
GS: In terms of revenue on individual products for casual games at retail versus download, how big of a hit do you take boxing these up rather than just offering them on your portal?
MC: What we've done in terms of pricing at retail has mirrored the online pricing model. The key price for a casual game on the Internet is $19.99. We've seen some products push up to $29.99, but it really seems that – at least at this point – the sweet spot is $19.99. The difference obviously is that at retail we have real hard costs. We have the cost of the packaging, fulfillment and supporting a product, snot to mention marketing to generate interest either in the category or in specific products.
So the model is very similar to what you'd see with any other retail publisher of games. Consequently, the margins aren't quite as attractive as they are in the download space, where the actual physical item is eliminated completely.
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