Social Network Games Casual Games Sector Report
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1 Games 2012 Casual Games Sector Report
2 What are The Players social network social network games - average player games? Female 40 years old Games run on a. They typically require the player be online, run embedded in the social network s pages, and use social features as deeply integrated gameplay elements. games revolutionized the western games industry. Solitaire, Bejeweled, and Mystery Case Files attracted millions of players in the last decade. As these games migrate to social networks, mainstream consumer gameplay habits are finally fully visible. U.S. social network gamers audience (in millions) console games - average player Male 37 years old Report 2012 Casual Games Association
3 The Payers How Games are Monetized Top Developers & Publishers The name of the game is free-toplay with most social network games using a freemium model of distribution and monetization. A freemium game is free-to-play, but players pay to purchase optional upgrades, extra content, virtual goods, in game currency, power ups, and other premium features. Only 1% - 5% of a social game s audience purchase virtual items, but this source dominates most games revenue streams. network games rely heavily on their big spenders, or whales. Whales spend more than 25 per month, on average. While whales represent less than 15% of a game s paying users, they account more than 50% of a typical game s revenue. Moderate paying players spend 5-10 per month, represent 25%-40% of the payers, and generate about 25% of the revenue. Most payers spend only 1-5 a month and generate less than 15% of a game s revenue, in aggregate. social games revenue stream 20% Advertising 20% Offers 60% virtual Goods Most paying users spend between 1 and 5 The top 10 content providers reach more than half of the total gaming audience on Facebook. Games require careful user research, economic tuning, and technical demands not typically encountered during casual game development. Successful social network content providers must also deal with the additional complexity of maintaining and evolving a live service. When examining this market, you must look beyond Monthly-Active-Users and Daily-Active-Users (MAU, DAU). In the retail market, price points are well known and monetary success is directly proportional to products sold. In the online world, with widely varied Average Revenue per User (ARPU) depending on game type, quality, and monetization technique, the audience size is not always an indication of business health. Furthermore, seemingly identical games may have very different revenue markers and player retention. This makes it very difficult for an external observer to estimate a game s success. top content providers for Facebook DAU 1 Zynga 46,040,192 2 Electronic Arts 12,367,782 3 wooga 7,518, waves Lolapps 5,306,300 5 King.com 5,270,000 6 PeakGames 4,580,400 7 Playdom 3,890,330 8 Tetris Online 2,100,120 9 GSN 1,852, Happy Elements 1,866, Playtika 1,680, MindJolt 1,511, Digital Chocolate 1,306, DoubleDown Interactive 1,300, KIXEYE 1,079,000 Source: Appdata 11/16/2011 expected avg daily revenue per daily active user Puzzle, Arcade, Caretaking, Simulations Hidden Object, Adventure, Tournaments RPG, Gambling, Poker For illustration purposes only as revenue varies greatly. Report 2012 Casual Games Association
4 Revenue What the Future Holds for U.S. Gamers Size U.S. Audience Gamers Audience Size Millions of Playersof Players Millions E E E EWill 82.7Facebook continue to dominate social gaming? Through, the portion of social network game revenue associated with Facebook peaks as Facebook continues to push into new markets. Following 2012, Facebook s portion begins to decrease as niche social networks expand their games offerings and developers seek out less crowded markets. network games are currently experiencing exponential growth that is expected to continue through 2014, helping to fuel audience and revenue growth in the online games segment. Worldwide (billion) 2011E 2012E 2013E Worldwide (billion) Facebook (billion) E E E E Worldwide 2011E 2012E Facebook 1.31 Facebook excluding Asia Asia 7.49Asia Total 3.65 excluding 4.94 excluding Total Total FB/Non-FB Revenues, worldwide (billions) FacebookFacebook Facebook excluding Asia excluding Asia 2011E e Emerging s Emerging markets are a key component of revenue growth in the global social network games market. Brazil and Russia are prime examples of current emerging markets for social network gaming. Use these three attributes to evaluate if a market is ready for social network games: e 2014e social gaming markets (millions) Brazil Russia 2. Attractive social network audience Existing payment systems for processing online purchases 2013e High speed internet and smartphone penetration excluding Asia worldwide social network gaming market (billions) Report 2012 Ca s ua l G a m e s A s s o c i at i o n CHART/GRAPHIC: Brazil E b CHART/GRAPHIC: Brazil (, - 20
5 Key Terminology Freemium Offering a game, product or service free of charge while charging a premium for advanced features, functionality, or related products and services. Cost per Acquisition (CPA)/ Customer Acquisition Cost Cost of acquiring new customers. Calculated by by dividing the cost of a campaign by the number of new application installs attributable to that campaign. Lifetime Value (LTV) Total amount that a player will spend with a particular game during his or her lifetime with the game. Virtual Goods In-game items or game-related services such as power-ups, premium content, or a temporary subscription that enable or enhance gameplay. Monthly Active Users (MAU) The number of unique users that have used an application at least once over the course of a month. Daily Active Users (DAU) The number of unique users that have used an application at least once over the course of a day. ARPPU Average Revenue Per Paying User. ARPU Average Revenue Per User. For press inquiries, please jessica@casualconnect.org. About the Casual Games Association When it comes to the health of your business, the more things that work together, the better. Which is why the Casual Games Association is a critical portion of the success of your company and the industry as a whole. It means that you and your team have access to cutting edge educational resources and are connected to thousands of other game industry professionals, members of the press and service providers around the globe. Learn more at
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