[Let me apologize in advance for the length of the large gaseous stream of consciousness belch which follows, it's been a while since I wrote anything and I guess some pent up stuff started flow.]
Another Q4 is behind us and the publishers are locked down in the deep, dark, musty bowels of their fortress like edifices surveying the seasonal lucre. The piles are not quite as high as year’s past and when they reemerge into the sunlight from their Morlock existence in the counting and analysis rooms, they will not be happy. Contrary to the mainstream media reports, sales for most publishers were less than stellar. Gamasutra’s story highlighting what they characterized as low numbers for Mirror's Edge and Dead Space (for the sake of argument let's not mention they did not apply the NPD multiplier to determine real US sales, nor did they add in PC sales or sales in foreign territories which are not reflected in NPD) reflects the norm rather than the exception. The point of the article, and the cause for concern, is EA made good on its promise, and created games with significantly higher Metacritic scores from the previous year - don't get me started on Metacritic-but the increase was not reflected in sales. EA was not alone, Ubi started price protection with Brothers in Arms on Black Friday, mere weeks after release, and by the year, their entire Q4 lineup was price protected to $39.95. An excellent Tomb Raider was barely a blip for Eidos and THQ was virtually nonexistent. In fact, the only publisher who seemed to make its numbers was Activision.
Outsiders may wonder how this may be the case when everyone from USA to Bloomberg are trumpeting the industry’s growth. The reality is the reported 18% growth is somewhat artificial when measured against the significantly larger growth in installed base. It is kind of like saying movie box office increased when ticket prices increased. When calculated from a tie ratio stand point, we probably lost ground.
The publishers’ first response will be to lay the blame on the crowded fourth quarter market. The market was indeed crowded, perhaps more than ever before. But blaming the crowded market is kind of like a rapist blaming his victim. The crowded market is both a creation of the publishers and unnecessary. More importantly, the crowded market was not the key damper on sales. The real reason for the low sales was consumers still don’t know they exist.
The gamasutra article suggests the titles were supported by good marketing campaigns, but I beg to differ. This would be accurate, if the publishers’ intention was a collective of stealth campaigns with a hyper accurate laser focus only on people who already knew their games were coming out. Funny, but the folks who are not in the business and buy one game a year don’t view Ziff Davis as a must read news source. With the significant exception of Activision, every publisher marketed the titles the same way it was done when I was at Eidos 12 years ago - which was basically the same way it was done since the last major innovation in game marketing when Trip Hawkins decided to stop selling games in baggies.
They all follow the same approach born from a time when games were software. First, market to the core gamers and then expand to the mass market. This worked in the beginning when games were sold at places like Compuware and The Byte Shop and game consumers were a small but disparate group. Even as the consoles pulled games into Toys R Us and the back corner of Wal-Mart, the games were able to hold shelf space for months or even years before stores demanded price protection and new product. There was no need for a big “opening weekend” because games could find an audience. If they didn’t, the small budgets made write offs insignificant. The small budgets also made publishers very happy with high six figure sales. Seven figure sales were dancing in the street time. But today, with budgets where they are and most of our sales happening in mainstream stores, titles are not supported by core success alone. If games don’t launch with fanfare immediately reaching into the mainstream they will be pulled from the shelf faster than an Uwe Boll film leaves the theaters. Even when they do stay on the shelf, with limited shelf space and demands for ever faster turns at retail, games don't hold price long enough to creep into the mainstream and earn out.
So while we still market as software, the world looks at us as entertainment media. Like the ESA keeps telling us, games are mainstream. Like the other forms of entertainment media we compete with, games must be promoted.
I am about to make a major departure from past practice and actually recommend cribbing from Hollywood. Take note, it must be good if I am turning to them. I am doing it because they know how reach people with their product and how important the launch is. A film’s opening weekend not only determines the duration of a film’s welcome in the theaters, but the size of its downstream revenue. We never had to worry about opening weekend or downstream revenue – until now. With retail shelf space in dedicated retailers being reduced, and reliance on Wal-Mart and Target with their limited number of slots in the locked glass coffins at the back of the store, our titles must do turns or move out. With the advent of DLC, the size of the incremental benefit from downloadable content is completely dependent on the number of units sold at retail. In other words, the duration of our welcome at retail and the size of our downstream revenue are increasingly dependent on opening weekend – or in our case, opening Tuesday. Unfortunately, from a marketing standpoint we approach opening weekend completely backward.
The film business does everything it can to engineer a large opening weekend. They learned over the years, marketing and PR directly impact opening weekend. Even their marketing campaigns are promoted as news:
Some 150 million 3D glasses will be given away for Super Bowl viewers to watch a three-minute 3D sneak preview of the big-screen animated feature "Monsters vs. Aliens." While 3D telecasts are nothing new, this marks the first time one has been done for such a large audience. DreamWorks Animation chief executive Jeffrey Katzenberg called the stunt "perhaps the biggest media-advertising event in history." He wouldn't give a hard figure on the cost, but said it "involves tens of millions of dollars."
Katzenberg promised the quality of the 3D will be superior to what has been done in the past. He said the glasses will use Intel InTru 3D and ColorCode 3-D, which updates the old red-blue Anaglyph system.The technology will also allow those without the glasses to see an almost ordinary image on the TV screen. But, Katzenberg added, it still doesn't come close to the 3D quality moviegoers will see in theaters when the film opens stateside March 27.
"Monsters vs. Aliens" follows a group of ragtag Earthling monsters who are out to save the world following an alien invasion. The film features the voices of Reese Witherspoon, Seth Rogen and Kiefer Sutherland. The glasses will be distributed free at Pepsi/SoBe Life Water displays at 28,000 locations including grocery, drug and electronics stores and big-box retailers.
The press is writing about the ad, the glasses are paid for by someone else, and each distribution point becomes a promotion for the film - and it is only the beginning.
Before you jump down my throat, I am not saying marketing can make a bad game into a hit. While some publishers used this strategy with varying levels of success at this point in time it just won’t work. I am saying, great titles won’t reach beyond the core gamers unless you tell the non-core they exist. How many more Psychonauts do we need before we learn this one?
The film industry employs a concept of “tracking.” Before a film comes out, they survey the audience to determine how many people are aware of the film and its release date, and of those people, how many people intend to see the film. When a film is not tracking well, the studio will increase the marketing budget. We have no parallel concept. The closest we get is extrapolation of pre orders and securing orders. Which is somewhat circular as orders are largely based on marketing. This is the first place we fall down. Film marketing budgets are based on whatever is needed to successfully launch their new IP. Our budgets are a percentage of projected revenue so when our pre orders and initial orders are low we reduce the marketing budget. Not only are we not helping sales, we are creating a self-fulfilling prophecy. The first cuts are in the mainstream outlets. Marketing becomes limited to online game sites, game pubs and possibly some basic cable. Or more simply, the places where only gamers will see it, and exactly where the marketing dollars are redundant. We can’t ignore mainstream promotion any longer.
Our largest retailer is Wal-Mart. Gamestop is a close second, but everyone who goes to Gamestop is going to buy a game. We spend most of our budgets telling the Gamestop consumers things they already know. The very few gamers who walk into Gamestop on a release day and don’t know a game just came out, will be made aware of the new presence as soon as see the fruit of the MDF dollars extorted from the publishers. The Wal-Mart buyers go into the store to buy milk, underwear, tampons, aspirin, a CD and perhaps cigarettes. The film industry knows this so the advertise DVD’s during American Idol and in Parade magazine. They tell people the product will be in the store and then keep telling them. The 110 million people who spend an average of 2 hours a week at Wal-Mart don’t go there to buy games, those people all went to Gamestop. With the games locked behind glass, the potential consumer who is lucky enough to find the games can’t even pick up a box and look at the back. If they don’t watch Comedy Central – only 1 million people do at a time – or MTV - only a few more million people – they won’t even know what Mirror’s Edge or Far Cry 2 are. If they don’t know, how can we expect them to buy? It is not their responsibility to research the games we preciously place behind glass it is our responsibility to tell them why they need it.
To be successful beyond the core we must market games like the film industry. We have to get people excited about the product and tell them when it is coming out. Sufficient dollars were spent on games like Halo 3, Gears of War 2, Fallout 3 and GTA IV and those titles sold. I saw their commercials on TV, trailers in movie theaters and stories in newspapers. They did not reach into 7/11s and newspaper headlines because they were successful; they were successful because they reached those places. People must know the game is out.
Gamasutra may think the marketing campaign was strong for Mirror’s Edge, but I didn’t see any billboards on Sunset Boulevard or commercials during Fringe. All I saw was fan boy eye candy on game sites, and lots of stylish commercials on Comedy Central. They may say they cannot afford to the mainstream spend; I say they cannot afford not to. EA does not have to look very far for a marketing template. Just stand up from your cube and look over at EA Sports. When I was in New York in September Columbus Square was closed down by a stage festooned with EA Sports and Madden logos preparing for the launch of the NFL Season. I am mentioning EA, but when viewed from the perspective of a mainstream entertainment consumer, I can say the same of the whisper releases for Far Cry 2, Prince of Persia, Tomb Raider or just about anything else released this quarter from anyone but Activision.
After we sold Tomb Raider to Paramount, the head of marketing told me a story about how he got his job. He was promoting a tent pole film for the studio and it was a really big film. He was trying to think about how to let people know the film was big. As he was driving down the street he noticed all the billboards for films were eight sheets. He thought “big movie/big billboard” and made commitments to buy sixteen sheet billboards. This led to his promotion as head of marketing at Paramount for the next seventeen years. Sounds kind of simple, but it worked. We don’t need revolutionary ideas, just change.
Activision telegraphed this to the industry last year at DICE when Robin Kaminsky told us the results of their research, and then they did it this year. Many choice words were exchanged in game forums and by critics about the “Risky Business” Guitar Hero ads, but Activision didn’t care. The ad wasn’t for us. It was for those 110 million other people the other publishers did not even address. Those folks not only ate it up, they bought the product at retail. In case that is not enough, Activision partnered with Wal-Mart to tag Wal-Mart ads with Guitar Hero bumpers. Everyone else tagged their own basic cable ads with PlayStation. Through marketing Activision was able to outsell EA with a product, which, while good, at best is only as good as Rock Band and at worst is a year late to market. But walk into Wal-Mart, Target or Best Buy and ask the consumer who does not read gaming pubs or web sites knows Guitar Hero as a brand and are seeing Rock Band for the first time on the sales floor. Guitar Hero is the band they know. Kobe Bryant and Michael Phelps were playing that one.
The film industry doesn’t solely rely on marketing. It also uses PR and the talk show circuit. Sure, we do PR, but only to gaming publications and websites. If I look at a Magazine stand with 1,000 magazines, roughly 12 will mention games on the cover. Of those twelve, one publisher and six by another own six. Three of each probably have the same game on their covers at any given time. If I turn my back and look around the stand, I see no other game coverage. The mainstream consumer we are trying to reach, the one who would probably enjoy the games we are making now, never looks in the little rat hole corner dedicated to games. They don’t know it exists. When a game does make it on to the cover – like Lara Croft on the cover of Entertainment Weekly and Time – sales soar.
I appreciate publishers try to get mainstream coverage and fail, but it is our own fault. We don’t make stars. I am not talking about the media twisted attacks on Jason Rubin’s speech “get invited to party stars” – although it is kind of weird to see pictures from the Fallout 3 launch party in Los Angeles with David Spade, Anthony Kiedis, Courteney Cox and the Foo Fights but hardly anyone can name the EP or lead designer – I am talking about celebrating those people who consistently contribute to hits.
The first response of the publishers is always “games are different, there are many people who contribute to a game’s success we can’t single out one.” This would be true, if films were made in Steven Spielberg and Sam Raimi’s basement with a handicam. But like games, films are made by hundreds of people. Even though many people whose names are never heard contribute to success, a handful are singled out to promote the film. The actors, whether you heard of them or not, go on junkets to speak with local news media in every market, the directors and in some cases, the producers do the same. They appear on everything from The View to the Tonight Show, saying the same thing, using as many outlets as possible to hit as large an audience as possible. These shows love covering games. They just don’t know how to access them. When we call them, cool things happen.
Promotional attempts are never rejected. You know why Lara Croft was the only character on the video wall on U2’s Zootv tour? Eidos was the only publisher to return their call! Things have not changed. Stars can emerge from the game business the same way they emerge from film. Film stars are institutionally created brands established to provide shorthand communication to an audience about the content and quality of a feature film. The studios even have contracts requiring these people to make a certain number of appearances and support the films. When Spielberg goes on TV to talk about his latest film, he is not saying he was the only one involved, he is simply saying “if you liked my last one, you might like this one.”
The next response from the hip game marketing types is always “we don’t have people with the presence to be stars. They can’t hold their own in an interview, or they are just not interesting.” This assumes the stars we see are real people. Over the past few years Tom Cruise and Britney Spears both showed us how carefully the public persona of a star is managed when they displayed un photoshopped versions of their personalities. It wasn’t pretty. A return to media savvy handlers led to what we now call “comebacks.” The studio publicity machine did not die when Rock Hudson came out of the closet. It is alive and well, telling you about Brad Pitt’s love of architecture and George Clooney’s real guyedness. We can do the same. Past efforts resulted in Will Wright cover of Wired and a bunch of other press (of course it didn’t happen any where near the launch of Spore) and Cliffy B profiled in the New Yorker. This is because Gaming, as an industry is fascinating and new to the public. The people who make the games are also interesting. But like the games they make, we hardly ever tell anyone outside the industry about them.
Let’s not talk about the third argument, which is “if we talk about how good they are, other companies will recruit them.”
I am not talking about cold fusion here and we need no more innovation than our own version of the sixteen sheet. It is also more than theory. Every time a game touches on the mainstream, for good, it sells. The first Mortal Kombat’s news coverage, the first Tomb Raider’s bus stop billboards, theater trailers and Pepsi Campaign and Guitar Hero’s Risky Business campaign all supported products with disproportionate sales relative to the rest of the market.
We don’t market effectively, because the market changed while the industry stood still. It took the game business ten years to do what Hollywood did in over seventy. It looked like were addressing the issue when the industry started hiring P&G folks (P&G is my term for anyone who worked at a consumer product company). The press releases announcing these hires always address the maturation of the industry and time to hire people with mass market experience. If this is all true, why do they always go into production or finance? In the P&G world careers are made by figuring out how to save a hundredth of a cent on a production process. That hundredth translates to millions of dollars in savings. Good for them, bad for us. In the game business, production side savings must be significant to have an impact on the bottom line. Leave this stuff to the game guys. The P&G folks won’t make a big enough impact to matter. We are hiring from the wrong place in the right pool. I addressed this once before in the context of writers. In the piece I wrote one of my favorite things I ever wrote:
Do you go to the world's leading neurosurgeon for a colon scan? The neurosurgeon is a brilliant doctor, probably got higher grades in medical school and definitely makes more money than a proctologist. Unfortunately, he does not know the first thing about looking in your asshole. Nor does he care to look up there because he can make more money working on the other end.
Let's get the high paid, well trained people working on the right end. What would happen if we used the P&G pool for branding and distribution and the Hollywood pool for marketing. That would place game production in the hands of the people who know what they are doing and provide support to the people and product that never enjoyed it before.
OK, I’m done now.