Approaching the mobile games market as a small team in 2016

(This post was originally published on my personal blog.)

These days, I am preparing to launch my own company focused on mobile games. As a result, a lot of the time I have to struggle with agonizing questions. A few of those questions come from other people, but most of them are from hypothetical voices in my head:

Thanks a lot, voices. You no doubt exist because of every single piece of news that comes out of the mobile market, which seems like bad news for small independent developers. Thanks to the massive successes of a few, costs to reach an audience are going up, while at the same time that same audience has less attention to devote to an exploding number of available games. In other words, people are too busy playing Candy Crush, Clash Royale, Covet Fashion and many other established games to care about *any* of the hundreds of new games that come out each day, let alone yours. The top of the grossing charts is largely locked to established games, many of which are becoming very recognizable brands and are unlikely to be displaced from there any time soon. Every month, new high quality games come out from teams that have a long term horizon and start capturing more of the audience for themselves, for a very long time.

How can a small team hope to find any kind of success in this environment?

I have no idea. But I intend to try and find out. My goal is to build a business with a long term horizon: I’d much rather end up with a company that can comfortably sustain a small team of 5-10 people after 10 years, instead of a one hit wonder that makes a lot of money in the first few years and struggles to survive later on.

So just before I begin my journey, I thought it might be a good idea to present the thoughts, rules and guidelines I intend to use when operating my company through the mobile market. I can’t promise these will be of any use to anyone, but at least it should be fun to revisit this post in a few years and compare to how all these thoughts worked in the real world.

Avoid one-off games

There are mobile games you might play for an afternoon, a week, or in some cases even a month. They are very simple games that might rely on a simple infinite mechanic, or require the player to go through limited content before you’ve beaten the game. They have non existent or very limited interactions with other players (maybe just leaderboards). They have you flipping birds, crossing streets, chopping wood, throwing spitballs. They can be extremely fun for a while, are a perfect time waster for those times you only have a minute to play, and some of them are even very successful.

For lack of a better term, I call these “one-off” games. Making these kinds of games is still very popular, because of how easy it is. There are even services you can pay for “source codes” to put such an app in the store in mere days. I’d guess quite a bit of the new games that make it into the app store every day are such one-off games.

I think it’s a bad idea for a new studio to focus on these kinds of mobile games in 2016 and beyond. The reason is that with the flooding of simple games in the app store, these games are becoming interchangeable commodities. It’s extremely hard to build long term customer recognition and loyalty in such an environment, even if you do find initial success. These kinds of games are also extremely easy to clone.

Making this kind of game may have been a viable business strategy 5 years ago, but not today

To reduce the impact of the hundreds of games that flood the app store each single day, you need to take a number of approaches. Ensuring you’re not competing directly with the majority of them is just the start.

Even if you have one of these simple games, there may be some ways to ensure it doesn’t fit my definition of “one-off” games. These are the best ones I know of:

Implement your business model with the goal of building a long term relationship with your players

If you’re a small team just starting out making mobile games in 2016 or beyond, you’re presumably using the F2P model. Maybe there are a few exceptions, but I see any other approach as suicide. There is an enormous and growing amount of high quality free content. Asking for money up front for an unknown game from an unproven team with no community around it sounds like a tall order.

Since it’s already 2016, we’ve all hopefully moved on from the pointless conversation of whether F2P is universally bad and evil, and into more focused discussions about specific implementations of the model.

I’ve seen quite a few disasters from teams trying to shoehorn F2P in a game in a way that not only ends up not making them money, it also destroys trust with players. My golden takeaway rule from those is this: To implement fair F2P, you have to play and have seen value from spending in a F2P game yourself (ideally, a game you have been playing for months). If that’s not the case, you need to get out of your inner circle and talk extensively to people who have.

There’s two common examples I’ve seen of misapplied F2P leading to hurt relationships with players:

Also: Destroy your childhood memories with pushy micro-transactions!

Think about it: If you don’t understand why some (but not all) of your players might want to spend money on specific parts of your game, the items you do sell are unlikely to meet anyone’s definition of value. Making sure at least some of the people on your team understand that value is important. And instead of agonizing over maximizing the amount of spenders, you should make sure you are offering an excellent experience to people who never pay a dime.

What about ads?

At first glance, this may seem like a very good time to have ads in your game. If you don’t like in-app purchases, it gives you an easy way to make money out of people playing your game. And the payoff is good and getting better, thanks to the massive success of many F2P games that keep pushing advertising costs up.

But consider this: Mobile games are largely in competition with each other to get a shortening piece of the player’s attention. If your way of making money now is to jeopardize your long term chances of building a meaningful relationship of trust with your players, maybe it’s better to find an alternative for making money. It doesn’t even matter how ads are implemented. In their best implementation (incentivized video ads that somehow fit with the theme of the game), they are still diverting valuable attention from your game to other people’s products and games.

Try to offer something different

If you look past what I call “one-off” games, many of the other games on the app store seem to be fitting pretty neatly in a limited number of archetypes. There’s the build your base and attack other bases game. There’s the match 3 edible objects game. There’s the grow your creature and go to battle game. There’s the assemble your deck and face other players card game. There’s the social casino game. You get the idea.

Within the archetypes, there is a variety of themes and in some cases interesting mechanics variations. But very often, some of these games are more or less clones of each other.

There’s a reason for this clumping of game types: They can still be profitable. Making a high quality Clash of Clans-like game, especially if accompanied by interesting changes and/or recognizeable IP, can definitely make money in 2016’s app store. Data-obsessed teams that use numbers to decide what game to do next are very likely to look at the marketplace and decide the safe bet is to make a game that is quite close to an already successful game. 

As a developer who wants to make interesting games, nothing sounds less appealing to me than cloning an existing game. Luckily, there’s also a business reason why this would be a bad idea in 2016: because it is unlikely to be a sustainable strategy in the long term. With a growing number of similar or identical games, I think it’s inevitable one day that even the very high quality ones among them will stop being sustainable.  The ones that have a head start and a strong community will be fine: People will still be playing Clash of Clans 5 or 10 years from now. But jumping on the bandwagon at this particular moment in time strikes me as a bad idea, because everyone else is doing the same thing. I would much rather take my chances trying to explore interesting ideas that haven’t already been done.

Of course, trying for innovative games is also extremely risky. There is lots of experimentation required, and multiple failures are likely.

Prepare for failure, aim for sustainability

It’s a pretty common and scary sight: A well funded team of experienced veterans are setting up a large-ish team (for mobile standards), prepared to take on the world. They cite a lot of important-sounding market research about how they will succeed. Cool sounding and largely meaningless terms like “mid-core” are thrown around quite a bit. Then they go off trying to make it all work. A couple years later they fail, lay off everyone, and blame it on the rapidly changing market environment. They forget to mention that the fact mobile was (and is) a rapidly changing market isn’t some kind of shocking new insight: we have all known that even before the iPhone came out.

When you walk into any kind of unpredictable, rapidly changing environment, the first thing you care about is survival. If somebody forces you to enter a dark forest and says there could be a murderer and/or a chest of gold, you will first put 100% of your attention to make sure you’ve neutralized the murderer first before looking for the chest of gold. Similarly, when you walk into mobile games, the first questions you answer are:

If you’re confident none of these answers might be “We will shut the company down”, you probably have a better shot than most already.

Michael Martinez describes the closure of JuiceBox Games, basically blaming the shifting market environment. From that we learn that Honorbound made over 2M in its first year, and reached #31 in the US top grossing list. This is a great performance for a first time game from a new company. Regardless, the company failed shortly after that, despite 8M total revenue in less than 4 years. Not only was this team not prepared for failure, they were also not prepared for moderate success. Betting that your new game will reach and stay in the top 20 in this particular market environment is a fool’s bet, regardless of game quality, team or IP. Companies that have been building relationships with their players for years have rightfully solidified their positions there, and know how to keep it. If you are to have a shot at joining them, you have to work for many years at it. And you will work at it from the shadows, not from the top of the grossing list.

Honorbound: A decent game that did well, but not well enough to sustain its team

Using some guesswork and pieces of publicly available data, I would estimate that a tiny team of 4-5 people can be sustained by having a game in the top 200-250 grossing games in key markets. Aiming for the top 250 games is now a completely different proposition than aiming for top 20. It’s still by no means easy, but it’s certainly at least an order of magnitude more realistic of a goal. Moreover, sustaining the team for a few years gives them the opportunity to plan longer term, and think how they may upgrade from sustainability to success. They can continue their conversation with existing players, and start looking for new players. They can show they care about player feedback, either via regular updates or new games. They wouldn’t be able to do any of that if the company had run out of money in the meantime.

Pick carefully who you work with

I mentioned above that a team of 4-5 may have a somewhat realistic shot at being sustainable on today’s app store. But is that enough people to make a high quality game that can sustain itself, market it, and build an ongoing relationship with players?

People are funny business. Very often, we agree that each individual is unique and that an exceptional person can have orders of magnitude more impact compared to an average person. But then when we plan, we exchange those unique creatures with numbers. “I need 10 programmers to build this important-sounding server infrastructure”. If you go seeking funding, you may be asked why you have less or more people than X successful team, and the difference may be seen as a weak point.

When talking people, I think all of that focus on numbers is garbage. I outright reject the premise that a team on any platform needs a specific number of people to become successful. It has been proven before that exceptional individuals can create excellent experiences of all kinds, that can also be commercially successful.

But I do want to set a maximum amount of 5 exceptional people for my company, until we are proven sustainable. There is a certain magic that happens from severe limits on people. Certain extraneous features get cut, and everyone focuses on the absolutely essentials. Communication is far easier. Achieving chemistry happens almost automatically – bad fits are extremely easy to spot.

A small, completely independent team has the added benefit that it can define success in a more flexible way than VC funded teams. I personally couldn’t care less if my team stayed in mere sustainability forever. If we can make respectable salaries while working on the kinds of games we love, that is already success for us.

My personal view is that you can absolutely have a high quality game with 5 or less people, developed on a reasonable timeframe with no crunch whatsoever, as long as they are the right people in the right environment. I’ve seen it happen with small teams when they were part of larger companies, and I think it can happen with a completely independent small team as well, as long as it has proper support structures.

Have the right support structures for your small team

Making good games, marketing them, evolving them over time, building and supporting a healthy community of players requires a lot of specialized skills. No matter how good the people, because of the small size the team as a whole is likely to have blind spots and lack of expertise in some of these areas. Big companies, for all their myriad of problems, have this covered: a small team that’s part of a big organization usually has solid support structures.

But a fully independent small team doesn’t come with any such built-in support structures. It has to create them from scratch. My approach for doing that is reaching out to other developers in a similar spot, and helping each other out when and if it makes sense.

You see, this blog post was kind of a Trojan horse. If you’re still reading carefully up to here, maybe you are also building a mobile game and thinking about similar things as me. Maybe you’re on a small team and are overwhelmed with everything you have to learn to make your game, market it and provide proper support for your players. It’s daunting. If you agree about the need for support structures, maybe you’ll see value in reaching out to other developers such as myself. Maybe we can stay in touch for a long time, and if and when it makes sense we can help each other out in small ways. It could be sharing tricks in Unity, discussing when or how it makes sense to buy ads for our games, sharing the contacts of good freelancers, or just playing each other’s milestone builds and offering feedback.

I’d love to hear from you.

Ask yourself if it would still be worth it in case of total failure

None of the above is meant to make me or anyone else feel better about their odds going into the mobile market. The odds are clearly not in our favor, and massive failure is a very likely outcome. Take a moment to ask yourself: how will you feel in the case of total failure? How will it affect your personal life, your relationships, your desire to make and play games? Are you OK with that outcome?

This, in the end, is the main reason I am so excited to be entering the mobile games market. Because at this point, the first time in my career I am truly free to do whatever I want, there’s nothing I’d like more than focusing on the platform I love. If it wasn’t for mobile games, I would probably have stopped playing games completely. And I know that no matter what happens, I will survive the ride, no matter how bumpy. Maybe I’ll even enjoy it.

To my future self reading this, I will say the same thing I say to the voices in my head: I regret nothing!