Gaming + Social is Driving New Interactive Entertainment Experiences
With mobile gaming dominating the entertainment category, there is an abundance of options for interactive entertainment companies. The capital markets today are flooded with liquidity, with a record-breaking pace of venture capital (VC) investments, initial public offerings (IPOs), and special purpose acquisition companies (SPACs).
Each path has its own merits but no matter what route a company takes to raise capital, scale and growth is key. These two factors will drive sustainable performance over the long-term.
Games that offer social interaction are best positioned to grow and scale. The transition of games to community-driven entertainment experiences has been more than a decade in the making, going back to my earlier experiences of scaling Zynga on its path to an IPO. Social interaction fosters community, which is critical for attracting and retaining users. There are a number of ways to operationalize this approach.
The Platform as an Ecosystem for Content Creation
The platform is the building block for lucrative omnichannel entertainment.
As defined by Bill Gates, “a platform is when the economic value of everybody that uses it, exceeds the value of the company that creates it.” A user-friendly and novel platform can push content and community to new heights. The platform becomes an ecosystem for content creation, social interaction, creative expression, and technology innovation. This produces a tremendous feedback loop to further advance content creation and community engagement.
Content Creation. Interactive entertainment experiences have to sync with their evolving ecosystem, akin to a pulse in a living breathing organism. To survive and flourish, the product needs to mirror the growing communities that are contributing to, and interacting with the overall ecosystem.
Fresh content is sustenance for the platform. There needs to be motivation for users to engage and contribute. A killer app establishes and amplifies the killer platform. A killer app like Pokemon Go is premium content that continuously updates with new features based on community engagement and user data.
A number of companies are bolstering content through consolidation. Large scale companies are leveraging M&A to add content to their ecosystem. As players engage with new content, they traverse across the gaming portfolio and build new, deeper and fulfilling communities.
Virality. The ability to engage and socialize with friends is an essential part of a platform and game experience. The faster a game catches fire, the faster it acquires users. The challenge is to keep the consumer engaged, and coming back for more. The capability to interact, socialize and hang out with friends creates a sense of community. Consumer adoption and retention is driven by the player community. A resilient, dedicated community becomes a competitive moat.
Preserve Content via Live Operations. Introducing new features in real-time keeps the game fresh and the users satisfied. We saw first hand how important a fluid player experience is during Niantic’s first ever virtual Go Fest, which achieved record levels of engagement. Given the importance of virality and the gamer relationship, the more the community is engaged, the better.
More broadly, we are at the cusp of a big advancement in computing. I expect immersive interactive experiences to expand and advance in both the metaverse and spatial computing. The metaverse creates shared worlds where players can interact with each other from anywhere around the world.
Immersive augmented reality (AR) technology pulls players deeper into the present moment and the real world around them. AR is most interesting to me, as it’s at the seam of atoms (tangible) and bits (digitized) on the digital superhighway. I see a future where AR is embedded in technologies, enriches the consumer experience and new dimensions of everyday life.
As platforms democratize content creation, it will be compelling to see how companies foster and attract creator communities to blend the best of social and gaming.
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