Social Gaming Trend Report

March 2011

Mattan Griffel
mattan@appssavvy.com
Report Contributors
Lo Noroña

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Social Gaming Has Hit Critical Mass

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The world of gaming has evolved

Tetris released Facebook opens up its FarmVille becomes

platform to third-party largest social
developers and social game ever, with 11
games emerge million daily active
users

(more than the total number

of people who have played
Tetris since 1984)

Source:  AppData  

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 20 percent of Americans are social gamers

US Social Gamers

68.7
61.9
53.0

2010 2011 2012

Source: eMarketer

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 has more monthly players than any
European country has citizens

(and it only launched last November)

Source: Facebook, EU Census

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 Social games continue to build on previous success

FarmVille CityVille
25,000,000

20,000,000
Daily Active Users

15,000,000

10,000,000

5,000,000

0
1 5 9 13 17 21 25 29 33 37 41 45 49 53 57
Days After Launch
Source: AppData Pro

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 Social gamers skew older and slightly female
US Social Game Players, by Age
18-21 4%
22-29 11%
30-39 20%
40-49 20%
50-59 26%
60+ 20%

US Social Game Players, by Gender

Female Male
54% 46%

Note: n=800; social games are online games played via social networks; numbers may not add up to 100% due to rounding
Source: PopCap Games, "2010 Social Gaming Research" conducted by Information Solutions Group, February 17, 2010

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There are four major reasons for the popularity of
social gaming:

•  Social games are easy to play. There are no controllers or

instruction manuals
•  Social games are integrated into the social graph. They
help enhance people’s relationships with their friends, family
and acquaintances.
•  In social games, everyone wins. With a focus on mutual
cooperation, everyone benefits by sharing and gifting.
•  Social games are free! No need to go to the store or buy
anything (unless you want to).

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Key Social Gaming Companies Have Emerged

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 Social gaming is an extremely fragmented industry
Select titles Platforms supported

BitRhymes
Tag Me, Cheers!! Facebook, Myspace, hi5, Orkut

CrowdStar
Happy Aquarium, Happy Island, Happy Pets Facebook

Digital Chocolate
Millionaire City, Vegas City, MMA Pro Fighter Facebook, iPhone, Xbox Live

Meteor Games
Island Paradise, Ranch Town, My Sweet Shop Facebook

MindJolt
Bouncing Balls, Cube Crash, Bricks Breaking Facebook, Myspace

Oxylabs
Photobuzz, Mafia, Resurrection, StreetRep Facebook, Myspace, hi5, Hyves, Orkut

Playdom * Mobsters, Social City, Bumper Stickers Facebook, Myspace

Playfish ** Pet Society, Restaurant City, EA Sports

Facebook
Madden NFL Superstars
PopCap
Bejeweled Blitz, Zuma Blitz Facebook, iPhone

RockYou
Zoo World, Truth Box, Toy Land Facebook, Myspace

Zynga
CityVille, FarmVille, Mafia Wars Facebook, Myspace, iPhone, Yahoo!
Note:  *acquired  by  the  Walt  Disney  Company  in  July  2010;  **  acquired  by  Electronics  Arts  in  November  2009  
source:  company  reports,  2010  &  2011  

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 The big 4 dominate the social gaming industry
Monthly Active Users (M)

258

(all others) 446

36 **

34
21
*
Note:  *acquired  by  the  Walt  Disney  Company  in  July  2010;  **  acquired  by  Electronics  Arts  in  November  2009  
source:  AppData  Pro  

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 But there is a long-tail of games for niche markets

130+ games with more than 1

million monthly active users

source:  AppData  Pro  

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Traditional gaming & media companies are joining

…but they haven’t

found much success

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Virtual Goods Are Worth A Lot of Real Money

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 Virtual goods are now a $1.5 billion market
US Virtual Goods Revenues (M)
$2,462

$2,019

$1,547

$1,087

$621

$265

2008 2009 2010 2011 2012 2013

Source: Piper Jaffray, “Pay to Play: Paid Internet Services,” July 13, 2009

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 The percentages of paying gamers vary

Amount Spent on Select Social Games

3%

PetVille 74% 10% 8% 5%

2%
% of respondents

Mafia Wars 84% 7% 4%3%

1%
Café World 85% 6% 6% 3%

Texas Hold'em Poker 71% 8% 5% 7% 9%

3%

FarmVille 82% 6% 6% 3%

None $1-$5 $6-$10 $11-$20 $20+

Source: Ipsos OTX MediaCT, “Maximizing Marketing and Monetization Opportunities in Social Gaming,” April 1, 2010

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The Future Of Social Gaming

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The future of social gaming
Off network games with The emergence of niche
Facebook connect gaming companies that focus
on specific audiences

Large-scale acceptance of
advertising in social games
The rise of mobile social gaming

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Appendix:
Opportunities and Challenges for Marketers

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 Advertising revenue will more than double by 2012

US Social Gaming Revenue Share

2010 2012

Advertising
14% Advertising
20%

Lead
generation Lead
offers Virtual generation Virtual
26% goods offers goods
60% 20% 60%

Total = $857 million Total = $1,323 million

Note: *Virtual currency incentives offered by marketers to social gamers in exchange for
signing up for subscriptions, participating in surveys or buying goods and services.
Source: eMarketer, Jan 2011

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 Social gaming is already on par with traditional media

Audience (M)
100

90
Social gaming Primetime TV
80

70

60

50

40

30

20

10

Note: Social gaming figures are in monthly average users, Primetime TV figures are in total # of viewers
Source: AppData Pro, tvbythenumbers, as of 3/11

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 There’s a social game for every audience

15 million active users 7 million active users

74% Female (148) 96% Female (192)
27% 26-35 (145) 31% Under 18 (156)

12 million active users 37 million active users

63% Male (126) 67% Male (136)
28% 26-35 (151) 25% 18-25 (166)

source:  AppData  Pro,  comScore  

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 Social Gaming can be 7-20x more effective than
online ads
Social Gaming and Online Advertising's Effect on
Brand Metrics in the US

45
Ad awareness
6
(delta above control)

60
Aided awareness
3

32
Purchase intent
2

Virtual Goods Campaign Online Norms

Note: delta defines as point difference in exposed vs. control groups
Source: eMarketer

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Social gamers are extremely receptive to advertising

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The brand opportunity is to leverage
pre-existing social activity within
social games

•  Gifts
•  Decorative items
•  Mission / Quest
•  Environment
•  Mini-game
•  Consumable

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 Branded social gaming activity is impactful

25% 32%
Coca-Cola Gift of the Day lift in purchase lift in
intent recommendation
intent

80%
took a post-
ad action

Post-Ad Actions
•  Purchasing a Coca-Cola product
•  Telling a friend or family member
about the ad or gift
•  Visiting the Coca-Cola website
Source: Zynga, Interpret

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appssavvy partners with the highest quality social
gaming properties to help you reach your audience

Developer behind nearly 20

games that dominate the top The place where you can be your own
boss, run your own fashion boutique, and
spots in the App Store
The largest social gaming shop to your heart’s content
developer in the world, Zynga
delivers the most active and
engaged users online

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