User acquisition is a huge thing, for a lot of reasons. Some games really force it, and I think that it can be spammy. I won't name the game, but I had a Facebook friend beg me to join his game, and he was like, "You don't even have to play it! You just have to join it, and install it... but please join me, because I need people..." And I said "okay", and then eventually I uninstalled the app, without ever having played the game.
SD: I think the reason why you see such behavior is because of two things -- one positive, one negative. The positive one is that those games make a lot of money. That's the truth -- it was said by many people on the panel -- but it is a free-to-play model, so the game is free initially for everyone to play, and then a percentage converts to playing users.
And hence, the economies here are more like web economies more than game economies; if you really scale to millions of users, then you'll be a really high margin business. So that's really what's driving some people to design games as harvesters of users, with as thin content as possible.
But full focus on this horrible word, which is mentioned so many times, which is "virality," which is designing an experience whose inherent purpose is only to crawl through as many users as possible, right? And then convert as quickly as you can on the back those users. That would generate a lot of profit, but the question is, where is the user experience in there, and where is the longevity of the experience?
So the negative thing is that experience you just described, which is sad, because this is supposed to be a game that's fun, and yet you are invited on this, not to be part of a fun experience, but literally just to contribute in this kind of incentive system. And that, we feel, is a valid strategy if you have some type of business objective, but the Playfish business objective is to really change how people play games.
And that sounds quite ambitious, but we think that we can really find the value you we can get from the game. And you will always love certain immersive games -- always, there's always a space for those -- but many people, and many more than the traditional game audience, want another type of experience, where the value they get from the experience is the social interaction, right?
So, as I was telling you about earlier, most people don't wake up in the morning and say, "Hey, I want to play a game!" Of course, console owners might, or a portion of console owners might, but a majority of people don't say this.
However, the majority of people wake up saying, "I wonder what my friends are doing," or, "What am I going to do with my friends today?" right? Whether just hang out at your local plaza, or do something together. So if you can latch onto this need from users, and provide them with something fun, it's the same thing as bringing them, like, free Frisbees in the park. I'm sure if you were to do that, you'd be hugely popular, right?
Like, "Hey, here's a group of friends. Hey! Here's a Frisbee!" right? And you wouldn't have to sell the Frisbee, or you wouldn't have to encourage people to use it; they would naturally use it with their friends. And that's much more akin to what we're trying to do. It's to provide a more fun experience.
And then, you know, from the Frisbee, evolve, and then say, "Hey, here's this new thing..." you know? "But it's still for you and your friends, and you want to try it," and they go, "Hey, why not? The Frisbee was fun; let's try this thing," right?
And so, then you can build this long term relationship with your users, when you say, "Hey, we are there. Our purpose is to create original, fun experiences for you." And then we get this reputation as a company for doing that. So that's why the positioning is very important.
And I think it's something that the game industry has traditionally been all about -- providing really great, fun experiences. Until the publishing gets involved, you know? Or the marketing side saying, you know, "Oh, we're going to run out of money," or, "The financing isn't right. We need to cut features; we need to remove this, and remove that..." and that's where, sometimes, it can break out. But what if there could be a world where you could remove that?
It sounds like Playfish is much more design-focused than worried about retention. I feel that in its infancy, social gaming frequently comes from a different mentality.
SD: It's not only important: it's the key, the heart of Playfish. We think of ourselves as game creators, and the rock stars inside our organization are our studios. We -- in terms of the founding team -- we are just enablers. What we want to do is allow our studios to be as creative as possible, with no barrier between them and the end user.
And as you said: when you're in games, all you want to do is make great games. You don't want to worry about what marketing is saying -- you want to make great games. So imagine a company that invites you as a game designer, and says, "Now make your great game. And if it's as good as you think it is? You have millions of people playing it."
That's what we try to do; we put all of our focus on the homegrown studios, sharing lessons between studios, sharing creative visions, investing time. Our dream, and we are working hard to pursue it, is to define next generation IP for games. At the core of it, we are creating IP. We are not licensing games, we are creating our own titles.
And like Nintendo defined the console generation with Mario, or like BioShock or Halo define their own big IP, there is a great opportunity to define next-generation IP that becomes the poster child for social gaming. So that's what we're trying to do. Much, much more than grow faster or bigger.
It's mind-blowing how fast you can get up to millions of users with one of these social gaming applications. And it is. At the same time, Anu Shukla was saying at the Social Gaming Summit that the quality of the users you can acquire very quickly might be very low, from a business standpoint. So, where do you find the meeting point between those?
SD: So, here's something where you're touching a very sensitive topic. What does "the quality of a user being low" mean? I mean...
Monetization was the implication that was being made.
SD: Yeah, but that's bullshit. I mean, how can you tell your users "You are a low quality user"? I mean, think about that! That's horrible to say, right?
SD: Every person inherently is someone that has needs. If they're "low quality," that's your own damned fault! You have not touched that person with something that has meaning to them, right? There is no such thing as a "low quality user," there is just a low quality experience. And if you monetize badly at a certain rate, then you have a low value proposition for some users, not a low quality user. And that's point number one.
Point number two is, if you acquire users through a spamming technique, and then you ask those users for money, it's normal that you don't get the same kind of ROI on those users as if you'd paid to acquire them. Quality aside: we, A, believe that users shouldn't be spammed; B, that you should not push games to them, and so you should make it hard to invite users.
I made that point on the panel -- I'm not sure that people fully understood me, but -- we make it hard by literally just putting the invite button on the side and saying, "Hey, if you want to invite your friend to have part of the experience, because you deem that, A, this experience for you would be better, and B, your friends, because you're friends, will like it, then click that button. If not? Don't click it." That's a really proactive step.
If it's strangers that you need to add to your game, so to speak, you click that button repeatedly. If it's your best friend, you can spam him once, twice, you know, and that third time he's going to ignore you, right? And you're going to lose some real life social capital, too. So, that's why it's been quite powerful.
Maybe our traffic is, using those terms, "higher quality," because they are more engaged. Because 18 months on, over 50 percent of our players are still playing on a monthly basis, maybe -- but I hate those terms. The failure can only be yours, not your users'. That's an unfair point.