2019 Predictions: #3 Simulation & Customisation Games get Primed for Growth
We’re half way to our predictions. To make sure you don’t miss all the following posts, please do subscribe to the Deconstructor of Fun infrequent but powerful newsletter. Also, the other 2019 Predictions can be found here.
Before you jump in, let us sum up how we arrived to the predictions.
First we created a taxonomy together with Game Refinery dividing the games market into four different genres: Casual, Mid-Core, Casino and Sports. Then we further broke down the genres into categories based on games and then we further divided each category into a sub-category based.
As as example, Candy Crush Saga is in a) Casual Games genre > Puzzle Games category > Match & Blast sub-categoryWe pulled the data of top 500 games (excluding China, Japan and Korea) from Sensor Tower and aligned the data with the genres, categories and sub-categories.
Once we had a clear view of what happened, we got together and wrote our predictions.
Please, take the numbers presented with a giant grain of salt. They are there more to show trends and to give rough estimates.
Special thanks to a couple of special people here at DoF including Jussi Huittinen for providing the bulk of the content and crunching the numbers, and to Abhimanyu Kumar for helping with editing.
First: A Sneak Peek into the Casual Market as a Whole
As you’ve noticed from the previous prediction post, we actively refer to the genres, categories and sub-categories. In this third post we discuss Simulation and Lifestyle games, which we see as categories in casual games. To understand our taxonomy in details, please read this. To understand it at a glance, please look at the image below.
The Simulation Games
Believe it or not, the Simulation category, which is known for “weathered” games, saw its revenues grow by over 20% in 2018 reaching ~$1.1B. The growth of revenues was accompanied by a growth of installs, which increased by ~13% from 409M in 2017 to 463M.
During 2018, the competition stayed mostly the same. And by mostly the same we mean really the same as it has been for the last 5 years across all sub-categories.
Adventure Games - Not likely to repeat a growth spurt in 2019
The Adventure category, which was known for long declined games like Simpsons: Tapped Out and Kim Kardashian: Hollywood grew significantly in 2018. This growth was due to Jam City’s Harry Potter: Hogwarts Mystery, which managed to make a total of $68M in revenues with 43M downloads. While the game was a success, it didn’t save the TinyCo studio, which was largely responsible for making the game. This puts a question mark on how profitable the game truly is. In other words, how big of a revenue share does Warner Brothers grab after the 30% cut for platform fees and all the marketing expenses…?
The future of Harry Potter: Hogwarts Mystery doesn’t look too promising either. Both Zynga and Niantic are rumoured to release their own Harry Potter games in 2019.
Overall, the Adventure games category is IP driven, relatively poorly monetising and costly to develop and run due to massive amount of content they demand. In other words, arguably one of the least attractive categories in mobile games.
Crafting Games - The resurgent sub-category
Till 2018 we know, are the combination of Township, Hay Day and the other old games like Sims, Sim City and FarmVille.
For years now Hay Day used to be the sub-category leader. In 2018 this changed. Hay Day’s year-over-year revenues declined by over a dozen percent while Township kept its run rate steady to take over the sub-category leadership some 7 years after the game was initially launched on Google Plus (!).
Hay Day and Township are clear sub-category leaders who exchange the number one spot on monthly basis. Klondike was the clear surprise hit of 2018 coming out of nowhere to capture the number three spot in crafting games.
Vizor’s Klondike was one of the most surprising hits of 2018. The game had tremendous success in breaking into an extremely entrenched and stable crafting category. And while we’d like to tout the developer for interesting design or great production values, the game looks like an old Facebook game from a second-tier developer down to an antiquated energy mechanic. Nevertheless, in December of 2018 Klondike Adventures already made a whopping $6.3M in monthly revenues.
The success of Klondike really shows that the sub-category is not as negative towards new comers as it looked like for years with games like King’s Paradise Bay and Zynga’s FarmVille: Tropic Escape biting dust. This feels like an excellent sign for FarmVille 3, which is set to take over the sub-category in 2019.
Breeding Games - Capitalise on IPs or Innovate to succeed
These games have been defined by the two Social Point games, Dragon City and Monster Legends.
The only truly noteworthy development during 2018 was the success that a two-year-old Jurassic World: The Game experienced during the massive launch hype of the second Jurassic World movie and the launch of Jurassic World location-based game. We’ve seen similar effect with older Marvel and Star Wars games when these franchises launch new movies. The key learning here is to have your finger on UA and in-game events when the sequels are coming.
While IPs are one way to break into the top of the sub-category, gameplay innovation and targeting a breeding game for a different audience is another proven way to hit the home mark. After all, these players have been breeding dragons since Dragon Vale… Fallout Shelter is a breeding game for a different audience and the game was a monster hit even without the feature set or content to carry it over a week of gameplay. Something that Hustle Castle fixed and capitalised on…
For a couple of months Ludia’s Jurassic World was leading the breeding games category ahead of perennial hits from Social Point - Dragon City and Monster Legends. But as the blockbuster movie exited the cinemas, so did the charts for breeding games normalise.
Sandbox Games - Two old games with the other doubling its revenues
The Sandbox category was perhaps one of the least interesting categories in Simulation during the last year. The category continued to be a story of Roblox and Minecraft each making a total of 210M and 73M in yearly revenues respectively. In addition, 2018 was extremely fruitful for Roblox for it managed to grow its yearly revenues by 84% with only 39% boost in downloads.
Sandbox games was same as Minecraft since till 2016. The Roblox started growing and hasn’t slowed down its pace. Minecraft free-to-play is a huge opportunity but given the weight of the IP it will take a long time before it will get introduced.
As for 2019, things are looking pretty good for Roblox because there seems to be no competition on the horizon for the Sandbox category.
Time Management Games - Change of guard in the kitchen
Virtually all time management games are some sort of cooking games. Arguably the best performing time management game in 2018 was Cooking Craze, which managed to get the top 1 grossing position of the category with a whopping $46M yearly revenue and 182% growth compared to 2017. Not only did Cooking Craze get the top grossing position of the category but it did so with only 16M downloads compared to Cooking Fever, which was the second in the sub-category with $34M revenues but a much larger number of downloads at 45M.
Cooking Craze is a great example of a game that entered entrenched and relatively small category late but was able to climb quickly to the top with smart improvements to core and meta-game.
The success of Cooking Craze can be explained by the difference in the monetization and progressions mechanics. While Cooking Craze offers slightly more easier core gameplay bundled with a saga based progression and monetization mechanics, Cooking Fever monetizes via almost gating progression and forcing players to monetize to unlock new restaurants.
Simulation Games in 2019
Crafting Games is going to be the biggest growing category after the massive launch of FarmVille 3 and entry of other low production follow-up titles trying to replicate the success of Klondike.
Harry Potter: Hogwarts Mystery’s decline will continue with the launch of Niantic’s game forcing Jam City to shift its focus towards other games following the Disney deal.
Minecraft will get a temporary yet very significant revenue boost following the release of Minecraft Movie in late May. It still won’t keep up with Roblox until they release more tools for user to generate content and for the developer to monetize on those tools. In other words, Minecraft has to go free-to-play to keep up.
The Lifestyle Games
With games like Design Home, Love Nikki, Choices and Episodes it is safe to say that the Lifestyle category is the most female focused category in casual games. 2017 was the true coming out party for the category as the games previously mentioned soared on top of the grossing charts attracting a plethora of copycats trying to take a piece of the rapidly growing pie. In 2018 the growth was more modest. The revenues grew by 34% in while the downloads stayed are relatively the same leve
Here we see 3 sub-genres with very different destinies. Interactive Story managed to increase by over 50% thanks to the growth of Choices and Episode. These two games remain undisputed leaders not giving new titles any opportunity. The music category remained a curiosity at best.
Interactive Story Games
Let’s start with some strong opinions and well supported opinions. The CPIs for story games are still surprisingly low. This might be because of the highly controversial creatives. On the flip-side, the retention in interactive story games is also notoriously low. These games are simply not social, and they lack even the basic progression mechanics. Lack of progression and social mechanics puts all the emphasis on the core game, which is stories. The more interesting and engaging the stories are, the better the game will fair. Hence, in order to succeed in the category, you need to have a superb editorial team, a ton of great writing talent and preferably some social and progression mechanics to keep the players in your game rather than having the hop over to your competitor with a catchier, or baiting, ad.
And no, IPs are not the answer. Sure, they will lower your CPIs and get you a ton of users who love the IP. But if your writing content is not up to par, these users will churn immediately. And as we all know, creating content with an IP’s oversight is slow, less daring and more expensive due to revenue share.
Lowering the CPI through click-bait creatives seems to be more efficient way than achieving the same result with an IP. But even then the story has to deliver.
Episode managed to evoke nostalgia with their Mean Girls IP and they went more modern with Pitch Perfect or HBO’s Pretty Little Liars. The move was really good because now none of the other story-based games can use these IPs, and they are among the most well known in the genre.
And of course there is the User Generated Content: Episode gives you the tools to create you own “episode” and become a hero of your very own romantic novel. A great way to engage your audience and save on the content production!
Revenue growth of various Interactive Story Games over 2018.
Choices is by far the biggest game in the sub-category with Episodes being the clear second. The main difference between the two is that Episode has an editor tool allowing players to create their own stories. Based on revenue data, players seem to be more interested in choosing their stories rather than creating them. The third player in the sub-category is Chapters. And just like the title indicates, this game by a Chinese developer is straightforward copy title with a strong emphasis of erotic elements in its creatives.
Customisation Games
While Glu’s Covet Fashion continued to tread along, Design Home from the same developer continued to grow throughout 2018. What makes this continuous growth so interesting is that Design Home hasn’t really improved that much since launch and it’s still mainly succeeding in the US. In other words, there’s still great growth potential for Design Home in untapped markets and through feature development.
Revenue growth of various Customization Games over 2018.
Design Home isn’t the only dominant game in the Customization sub-category though. Tencent’s Miracle Nikki or Love Nikki as it was called before doubled its run-rate in the West.
What makes Miracle Nikki interesting is that it’s such an extremely deep customization game with a full-on RPG meta-game. It’s arguably the first mid core game for a female audience and it’s definitely monetizing like one. The success of Miracle Nikki proves that developers who are able to intelligently bundle female focused themes and gameplay with elaborate mid-core loops will succeed in the market in 2019.
EA tried also to take a bigger piece of the customisation games sub-category with Sims Mobile. The game was a follow up for the incredibly successful Sims FreePlay and despite being a much more polished and feature rich game, it fell flat failing to attract and reactivate players who played the prequel as well as failed to cater to the massive core Sims audience.
read: 3 Reasons Why Sims Mobile Misses the Mark: In-depth Analysis
Today Sims Mobile and Sims FreePlay make just as much in revenue as Sims FreePlay did alone just a year ago. In other words, same amount of revenue with a multiple of cost. Undoubtedly not something EA was gunning for.
Predictions: Lifestyle Games in 2019
The Lifestyle category will continue to slowly grow revenues.
The gap between Customization and Interactive Story games will increase further as Customization category evolves with more robust features.
The amount of story games will continue to grow, but developers will look more into combining the story layer with other casual genres. Nevertheless, Episode and Choices will continue to be at the top if the sub-category.
Miracle Nikki will become by far the biggest customization game, inspiring other developers to make female focused mid-core games.
We will see more “hybrid” titles with other puzzle meta and customization ala Home Design Makeover
