Category: General Social Games Business

Jacoby Brissett shows in one night what I’ve been trying to explain for years

Last night, the New England Patriots beat the Houston Texans 27-0 with Jacoby Brissett at quarterback. What is surprising to some is that Brissett is an unknown third-team rookier quarterback only playing because the star starting quarterback, Tom Brady, is suspended for four games and his back-up Jimmy Garoppolo was injured last week. What the victory so poignantly shows is that companies and teams succeed by building a good system and not letting inevitable hardships derail them.

Over two years ago, I wrote about the Next Man Up philosophy, how rather than dwelling on adversity just keep moving (not surprisingly, it was also about the Patriots). The core is that successful companies and teams focus on their goal and do not let short-term issues serve as a reason to fail.

No excuses

At its core, this philosophy is about staying focused on what you need to do to succeed, not why you might fail. It would have been easy for Patriots Coach Bill Belichick during the week to say they would “try their best” but without their top quarterbacks it will be difficult. Instead, Belichick’s message was his job is to beat the Texans, it has always been to beat the Texans and that is what he will prepare the team to do.

Companies and individuals often look for reasons why a project will not succeed or already has failed. I remember at E3 after 9/11, hearing from multiple game development companies that they ran into problems or their games did not succeed because of 9/11. The truth was they would not have succeeded regardless and most of these companies failed to ever succeed.

There will always be reasons that can rationalize why you are not successful: someone left the team, competitors are not pricing fairly, regulations have changed, blah blah blah. The reality is things never go as they are planned, there will always be unforeseen obstacles and hurdles. Good companies, good coaches and good leaders, however, do not care about the excuses and focus on the goal and how they will succeed given the circumstances. They do not make excuses when they fail, they learn from them (and avoid them).

Not rah-rah

What is also interesting in the Patriots success last night (and pretty much the last ten years) is that it was not at all driven by a great motivational speech. As well as not making excuses, Belichick did not extoll his team to play at 110% or do it for Brady. Instead, it was business as usual. We have a job to do, the variables have changed as they always do, but we will go out and do it. That is exactly what the Patriots did last night.

The press, and many people, love the charismatic, macho, inspirational leader. Rex Ryan (former New York Jet and current Buffalo Bill American Football coach) had a rabid following because he was so enthusiastic and his players loved him. Elon Musk has more fans than any businessman I have ever seen. Yet it is the Bill Belichek’s, Jeff Bezos’ and Bill Gates’ that deliver results year in and year out, and neither of them could be deemed charismatic. In fact, they are often successful because the team and the company are at the forefront, rather than their individual star.

It’s above the individual

Related to the coach not being the center of attention, the Patriots show that success is about not elevating any individual above the team or company. While the Patriots have had many great players, they have fostered a team first mentality. Even Tom Brady, New England’s injured starting quarterback who some consider the greatest quarterback of all time, celebrated on Facebook the Patriots win last night even though it theoretically could have impacted his greatness by showing the Patriots win with or without him.

This strategy also makes it easier to deal with an employee who leaves or a player that gets injured. Again, to use the Patriots example, they have now won all three games that Tom Brady has missed due to his suspension. By contrast, when the Indianapolis Colts (a traditional Super Bowl contender at that time) in 2011 lost quarterback Peyton Manning to an injury for the season, they ended up winning only two out of 16 games. In the business world, there is also almost always turnover. If you tie your success to one individual, you are much less flexible in your ability to deal with future situations.

It’s about the process

What it comes down to is building a good process to achieve your ultimate goal, whether that is hitting revenue targets or winning football matches. If you have a system that can weather external shocks you will achieve this goal rather than spending your team in a bar rationalizing why you failed and your competitors succeeded.

Key Takeaways

New England’s 27-0 victory over Houston Thursday night with a third string rookie quarterback exemplifies the concept of how a good system will help any team or company succeed regardless of the circumstances.
Good companies and teams succeed by not making excuses (either before or after the fact) but simply focusing on succeeding knowing that circumstances will sometimes be against them.
They also succeed by ensuring they build a system not centered on an individual but one that allows for success regardless of changes to the team.

Lessons from Overwatch to help you create a hit

One of the biggest hits in the gaming space this year has been Overwatch from Blizzard and there are several lessons game companies can learn from it. An article in Rolling Stone, Blizzard Reveals How to Make a Hit Game in 9 Easy Steps, highlights these lessons, though grossly underestimating the difficult in making a hit. I have been in the game industry since 1993 and have seen many companies do everything right but still fail. Actually, that is still the likely outcome with more than 80 percent of games failing but the expected value of a hit still makes it a (sometimes) profitable business.

By looking into the success of Overwatch, you can improve the odds of creating a successful game. Some of the keys that Blizzard’s team pointed to and that I agree with, with my prioritization:

Ditch everything that gets in the way of players. According to Blizzard VP Jeffrey Kaplan, “Blizzard doesn’t focus on reducing game difficulty across the board. Instead, it preserves a game’s ‘core fantasy’ and gets rid of friction points: needlessly complex aspects where ‘normal’ human beings will step away from the computer in a moment of frustration, but the more-hardcore will stick around.”

Blizzard looked at all the conventional norms of the industry and then asked the question of each, can they be reduced to make a simpler but still great experience. The key here, and one of the keys to great game (and product) design, is the more you eliminate, the better the product. This runs counter to conventional wisdom about always adding features.
Appeal to new players with a subtle learning curve. Blizzard’s games take a long time to master, and any product that appeals to core players will need to so they can satisfy those hardcore players. These days, however, even the most hardcore gamers will not put up with a tutorial that lasts in the days or hours (and probably even minutes). The game industry has to face the same reality as electronics or car makers, the manual (or in this case tutorial) will not be opened or at most not read carefully.

Rather than a long boring tutorial, Blizzard on boards players by controlling the early experience. “In most of its games, players start with a [short] tutorial, then play against the A.I. Finally, they start to battle other players, but in a very shallow pool amongst other beginners. They join the main group only after they figure out what’s going on. Even then, the learning process continues. In Overwatch, the “Kill Cam” and “Play of the Game” features showcase short videos that might prove instructive to beginners.”

The key is for players to get immersed in the game quickly by controlling the competition, not by teaching. Thus they are already enjoying the game when they decide whether to come back (or monetize).
Blow up your games and start over. A lot of your development efforts will fail, even if you are Blizzard or Supercell. Supercell “pops champagne” when a game fails. Blizzard has cancelled as many games as it has shipped. By canceling the games that were once promising but no longer have the magic they need to succeed, it allows your company to focus on the product most likely to succeed.
Polish and prune as you go. One thing that I have not heard from other companies but makes ultimate sense is to polish and tweak your game throughout the development process, rather than at the end. I have seen many times how the last 20 percent is the difference between a hit and a failure. This reality is most obvious in the shooter space, where so many developers have great technology it is not a competitive advantage. It is the little features that generate hits, first shown by Duke Nukem’s unexpected rise in the market in 1996. At Blizzard, “instead of blocking out the larger elements and leaving the fine tweaks for the last stages, they pour effort into polishing each step as they go.” This is a great way to ensure you have a polished product that delights players even for your soft launch.
Pick your genre. Blizzard has done a great job of focusing on a genre, allowing it to create product expertise, customer insight and brand equity. It’s titles, starting with World of Warcraft (or Diablo) and going to Overwatch, have all been markets targeting hardcore gamers. They know what these gamers want and have been able to create appealing products. This focus on a genre has allowed them to not only weather, but also thrive, during platform shifts (Hearthstone quickly established them as a leader on mobile).

Conversely, Zynga shows what happens when you do not follow this strategy. After building a great business and deep customer knowledge of the casual female player with titles like Farmville and Fishville (and anything else ville they could think of), they tried to dominate the mid-core mobile space. Three CEOs later, they are still trying to gain a leadership position on mobile (where, not coincidentally, they are seeing their biggest success in social casino, which unsurprisingly targets an older female demographic).

Give yourself a fighting chance

I would summarize the key to great game development as eliminate, eliminate, eliminate and tweak, tweak, tweak. As I mentioned earlier, at least 80 percent of game launches fail (and I’m not talking Indie, look at King or Kabam or anyone not located in Finland). By creating a game that immerses players quickly and is not unduly complicated; and by focusing on a genre where you have expertise, you will have a chance to succeed where others fail. And, as Blizzard does, do not be afraid to kill projects and start tweaking from day one.

Key takeaways

The most important key to creating a successful game is eliminating elements and mechanics that are not really necessary. Less is more and good design is not adding more features.
You need to plan the early user journey so the player gets immersed and learns the game naturally, while having fun, rather than using a long tutorial as a crutch.
Be willing to kill projects quickly so you can focus on the games with the best chance of success.

Focusing on the core is the key to your company’s survival and success

There is no shortage of theories and articles on how to grow a business, but one I recently saw — What Netflix and House of Cards can teach us about why most companies fail by Harish Abbott — does a great job of showing the key to survival and success. Abbott starts with a statement that most experienced entrepreneurs know all too well but those who have gotten their business experience from television do not grasp, “most companies fail.” These failures, however, do not come from poor ideas or even lack of demand. The key cause of failure is not focusing on your core offering.

Focus on your core offering

To not only avoid failure but also sport significant growth, you need to identify what is your core offering and build off of that knowledge. Abbott uses the example of Netflix. Netflix, once it moved from sending DVDs to streaming, realized its key value and differentiator was content. Although it needed to deliver this content in a seamless manner, the quality of the content was what would be key to its success.

Conversely, customers did not care how they received the content, as long as it was a good experience that did not actually interfere with consuming the content. As Abbott wrote, Customers don’t care how House of Cards gets to them, so long as they can watch it anytime, anywhere. For Netflix, the realization was that the streaming technology itself was not Core to their business, but still Critical. Instead of enduring a costly and distracting build out of proprietary streaming infrastructure, Netlfix turned to Amazon Web Services (“AWS”). Netflix realized that AWS was already fast, stable, and secure.”

By outsourcing elements of its offering that were not core, they could then focus on the actual core offering. Initially, that meant securing more content than any of its competitors, the content its customers wanted. Then it meant creating new content that competitors could never access, from House of Cards to Orange is the New Black to Narcos to Stranger Things. By focusing on the core offering, Netflix now enjoys a valuation of over $40 billion.

Outsource what is not primary

The corollary to focusing on your core offering is outsourcing what is not core. As I just mentioned, although streaming is critical to its users experience, Netflix did not try to build a superior streaming technology. Instead, it leveraged AWS to give its users an optimal streaming experience. Marketing is core to Coke’s business, so it focuses on doing marketing internally and using external companies for bottling even though bottling is critical in the user experience (nobody wants a flat glass of coke). Apple is great at design but let’s third parties do the bulk of manufacturing.

The key is that these great, huge companies know their core strength, build on that and use others to provide everything else. The companies that fail try to do everything themselves and then cannot leverage their true advantages.

The key to success

To succeed, you first need to identify what is the core value you are providing. You then need to figure out how to focus on leveraging this core offering while using partners and products to ensure the other parts of your product still create a great customer experience.

Key takeaways

The key to success, and survival, is understanding your business’s core offering, why your customers will consume your product.
Then focus your efforts on leveraging this core offering, making it better for your customers and more difficult for competitors to copy.
Find good third parties to provide the other key elements of your business, but not core elements, that are necessary for a great customer experience but are not your company’s strength.

Optimizing failure

I am a big fan of failure. I not only encourage my team and people around me to fail, I consider it a problem if they do not. It means we are not trying enough new things.

Even if we have a 90 percent chance of success with everything you try, if you try 30 or 40 initiatives 3-4 will fail. I argue that only trying things with a 90 percent chance of working is too conservative; you need to look at the expected return and try any that have a positive expected value, even if they have less than a 50 percent chance (if the upside is high enough). The key is if you are not taking risks, you are not doing enough to increase value.

A great article in the Harvard Business Review, “Increase Your Return on Failure” by Julian Birkinshaw and Martine Haas, adds an important layer to the thesis of pursuing failures. Birkinshaw and Haas provide a framework to learn from your failures, so that even the initiatives that do not work create value.

The authors point out that while most companies acknowledge and support the need to fail occasionally, management processes actually work against this goal. Most budgeting, resource allocation and risk control systems are built on predictability and optimizing efficiency, giving bonuses and promotions to those executives “in control.” Thus, even if you are encouraged to fail, you are incentivized to do everything possible to avoid it. The solution is to extract value from failure so you an increase your return on it, boosting benefits while controlling costs. There are three steps to raise your return from failure.

Learn from every failure

The first step to generating additional value from failure is getting people to reflect on projects and initiatives that had disappointing results. While it sounds obvious, it often does not occur. Most people find reviewing failures quite painful and would prefer to invest their time in looking forward.

A failure provides the chance to revisit your core beliefs and adjust them where needed. The authors recommend asking the following questions to understand the benefits and costs of the failed initiative or project:

What have we learned about our customers’ needs and preferences and our current markets? Should we change any of our assumptions?
What insights have we gained into future trends? How shold we adjust our forecasts?
What have we discovered about the way we work together? How effective are our organizational processes, structure and culture?
How did we grow our skills individually and as a team? Did the project increase trust and goodwill? Were any developmental needs highlighted?
What were the direct costs – for materials, labor, art and production or software development?
What were the external costs? Did we hurt our reputation in the market or with customers, or weaken our competitive position?
What were the internal costs? Did the project damage team morale or consume too much attention? Was there any organizational fallout?
What are the key insights and takeaways for the business?

These questions will help you think of everything that you and your company have learned, how it might help you move forward and all the positive side effects from the experience.

Share the lessons

The big benefit from failures is spreading the lessons across the company. You can amplify the paybacks from failures by passing between business areas the information, ideas and opportunities for improvement gained from the above analysis.

Shared learnings also increases the proclivity to pursue future initiatives. By reflecting on the positives, you build trust and goodwill and clear the path for others to take action on risky initiatives.

Review your pattern of failure

The final step to gaining value from failure is “to take a bird’s-eye view of the organization and ask whether your overall approach to failure is working.” Do you have a process to learn from every failure? Are these lessons shared? Are you using these lessons to improve both your strategy and execution?

This analysis will help you see if you are failing too much (and unnecessarily), not enough (and thus not taking enough risks) or at the appropriate level. If you are failing too often, you probably need to make the green light process for initiatives more rigorous. If not enough, you need to generate and evaluate more initiatives.

The benefit

Failure is critical to generating the most possible value. By rigorously learning from failures, you increase their return and the ability to pursue future initiatives.

Key takeaways

You need to encourage failure. Without failure, you are not pursuing enough initiatives to grow.
To get the most from failures, and subsequently prompt people to launch initiatives that can fail, you must study failures carefully and learn about the market, customers and organization.
You also need to circulate this information through your organization.

Turn everyone into an innovator

There was an interesting article in the Harvard Business Review, How to Build a Culture of Originality by Adam Grant, that does a great job of showing how to turn all of your team into innovators. The article starts with a discussion of the US Navy, arguably the poster boy for lack of innovation, and explains how it started “exploding with originality.” What is interesting about the navy example is that the innovation was not centered around iconoclasts or entrepreneurial types but from the rank and file. Most importantly, if it can work in the US Navy, the strategy can work anywhere.

When everyone thinks the same and is relocation to move away from best practices, companies rot. To drive innovation, you need sustained original thinking in your company. The way to do this, as Grant shows, is to build a culture of non-comformity. You must give your team opportunities and incentives to generate new ideas and push beyond the obvious or traditional. You also need to vet those ideas so that the best are executed on, not simply the most popular.

Generate a plethora of ideas

It is critical to get people to generate many, many ideas. In research cited by Grant, the first 20 ideas people generate are significantly less original than their next 15. Across all fields and functions, volume leads to quality (rather than opposing it).

Get people to think boldly. Rather than asking them for improvements, ask them to propose alternative strategies. Have them think like competitors, how would they attack you in the marketplace.

You also get better ideas by asking them individually rather than in groups. When people generate ideas together, many of the best ideas do not get shared. Some people, intentionally or not, dominate the conversation while others hold back to avoid looking foolish.

Another way to generate ideas is actually a throw-back, bring back the suggestion box. While you may end up in an HBR cartoon, suggestion boxes are quite useful as they provide a large number of ideas. As Grant writes, “the major benefit of suggestion boxes is that they multiply and diversify the ideas on the horizon, opening new avenues for innovation.”

Developing a sense for good ideas

While the first step to innovation is generating great ideas, equally important is listening to the right opinions and solutions. Rather than using a democratic process to select ideas, assign people with great track records innovating to select the right ideas. You may want to weigh people’s vote based on their innovation track record or limit the vote to those with a real track record of innovation success (if you have them). The key is not turning it into a democratic group process as many people will not have a good understanding of which ideas have the best potential.

Another successful mechanic is to run a contest or tournament. As Grant writes, “When an innovation tournament is well designed, you get a large pool of initial ideas, but they’re clustered around key themes instead of spanning a range of topics. People spend a lot of time preparing their entries, which can boost quality, but the work happens in a discrete window of time, so the contest is not a recurring distraction. Thorough evaluation helps to filter out the bad ideas. The feedback process typically involves having a group of subject matter experts and fellow innovators review the submissions, rate their novelty and usefulness, and provide suggestions for improvement.”

Cultivating both cohesion and dissent

While you may develop a plan to generate and evaluate ideas, you need to put the appropriate processes in place to maintain originality over time. It is not necessarily building a cohesive leadership team. While in some cases that works, in other cases you introduce groupthink. Even unintentionally, like-minded people gravitate to each other, so you run the risk the leadership team all approaches problems the same way. It is thus critical to make dissent one of your company’s core values. “Cohesion and dissent sound contradictory, but a combination of the two is what brings novel ideas to the table—and keeps a strong culture from becoming a cult.”

A critical tool is to build a framework for choosing between conflicting opinions and allowing the best ideas to win out. When companies fail to prioritize values, performance suffers. Values should be rank-ordered so that when employees face choices between competing courses of action, they know what comes first.

Another tool that runs counter to conventional wisdom is to solicit problems, not just solutions. Although you probably love when employees come up with solutions, there’s an unintended consequence: Inquiry gets dampened. If an employee is always expected to have an answer ready, they will arrive at meetings with their diagnosis complete, missing out on the chance to learn from a range of perspectives.

Another tool to help create a stream of original ideas is that rather than appointing a devil’s advocate, find one. To have impact (rather than simply go through the motions), the devil’s advocate actually has to hold a dissenting opinion and the group has to believe that the dissent is real. Only in this situation will the group seriously consider the dissent and evaluate the idea more critically.

You should also encourage people to challenge you in the open (rather than the my door is always open cliché). If employees see open dissent, and see that it is viewed as a positive, then they too are likely to express their true opinions. You can also get people to challenge you by broadcasting your weakness. I will often tell my team I am not a game designer and encourage them to challenge me on design issues.

Ideas are the first step in innovation

If you build a culture that generates many ideas, and then have a process in place to evaluate them critically and move on the best, you are more likely to innovate. These new ideas can keep your company from stagnating and help you stay above the competition.

Key takeaways

The first step in innovating successfully is generating a overabundance of ideas from your employees.
Rather than having people focus, encourage them to generate many, many ideas from asking individually to running contests to bringing back the suggestion box.
It is then critical to evaluate the ideas effectively, primarily by having those with the best track record in innovation making the choices (or having their opinions weighed higher) than a purely democratic process.

You need to create a great cross-platform experience

While most game companies talk cross-platform, they really mean putting their product on multiple platforms rather than optimizing play for customers who want to play on different devices at different times. They are missing an important opportunity, or alienating their users, by not focusing more effort on creating a great experience across platforms. I came across an article on Adweek’s SocialTimes, Study: Customers (Especially Millenials) Hate When You Fail To Deliver Cross-Platform Experiences, that provided great data on what happens when you do not have a good cross-platform user journey.

Surprisingly strong activity across devices

More than half users switch devices mid-activity. The number is highest for Millennials, where 90 percent switch devices mid-activity. With GenXers, it falls to 76 percent and with those 55 or older, it is 58 percent. What is striking in these numbers is that even with the lowest number, more than 50 percent still switch devices mid-activity.

When it comes to playing games, the number falls but is still quite significant. 14 percent of all US customers change devices mid-activity. 25 percent of US Millennials change devices mid-activity while playing games.

What it means for messaging

You thus need to craft messaging that is relevant for a player or user who started on one device and is now playing your game or shopping on your site on a different device. The article quotes an Adobe analyst as saying, “that means digital marketers have a unique challenge of being able to really understand that a Web visitor who shows up on a smartphone is the same customer four hours later on a tablet, or seven hours later on a desktop. They have to piece that experience together in order to craft a consistent message to that one consumer, regardless of which device they use.”

What it means for games

While many games now allow you to share your balance across devices, there is an opportunity to please better your players be integrating further. There are several steps a game company can make to create a great cross-device experience.

A player should be able to pick up a game in the exact same place on a new device simply by opening the app. If they are in a tournament or raiding another player, they should pick up that raid as if they were on their original device.
When they first install on the other device, the journey to synching their accounts should be seamless and as few steps as possible.
The interfaces should be optimized for each device (let’s not make an inferior product in the drive for standardization) but consistent and familiar for players moving from other devices.
Players on one device should not have a gameplay advantage (or disadvantage) on different platforms.
Ensure your CRM is consistent across devices and not redundant (do not hit someone with the same message three times when they use three different devices in a short time period).

The benefits are worth it

I have written many times about satisfying your customer and catering to their multi-device activity is one of these instances. If you do not create a great experience, a competitor will and you will start losing players. Moreover, these are probably your most engaged customers, so the cost of replacing them is even greater.

Key takeaways

More than 50 percent of all users change devices mid-activity, with this number increasing to 90 percent for Millenials. With those playing games, 14 percent change devices mid-activity, rising to 25 percent for Millenials.
To leverage this situation, you should build your game so it is easy to play across multiple devices, keeping a familiar interface, sharing a wallet and keeping the game fair.
Your CRM also should reinforce a consistent message across devices without the messages stepping on each other.

How to become a growth company again

In February, I discussed the challenges companies have dealing with a changing business environment and a corollary to that challenge is how to reignite growth once your company has stagnated. Chris Zook and James Allen tackled this problem in an article, Reigniting Growth, in the Harvard Business Review. In the article, the authors point out that almost all companies eventually face stall-out, “a sudden large drop in revenue and profit growth or a collapse of once high shareholder returns to well below the cost of capital. Stall-out occurs when the growth engine that powered a company to success stops working. This rarely happens because the business model has suddenly become obsolete—a common misconception. Rather, [their] research shows that the business has almost always become too complex, most often owing to bureaucracy that slows the company’s metabolism, or internal dysfunction that distorts information and hampers managers’ ability to make rapid decisions and take swift action on them.”

There is a consistent theme when looking at big companies that have stalled-out. They talk about being swamped with bureaucracy, overwhelmed by Powerpoints and an inability to act decisively even on great opportunities. While competition impacts your growth, success hinges on remaining fast, perceptive, innovative and adaptable. 94 percent of leaders of companies with $5 billion plus revenue believe internal dysfuntion was the main barrier to growth, not competition or lack of opportunity.

The authors identify three qualities that can help overcome stall-out. By rediscovering your insurgent mission, obsessing over the business front line and instilling an owner’s mindset, companies can reignite growth.

Rediscover your insurgent mission

The first key is to regain the focus and mission that drove your company’s growth. When stall-out occurs, it is almost always connected to creeping complexity. The authors suggest companies experiencing stall-out need to liberate resources, narrow focus and harness the vigor that drove early growth. The company should shed noncore assets and businesses. Then attack complexity in the core processes. Finally, your company should focus on reducing product complexity.

Part of the problem is the democratization – or socialism – of resources. As companies grow, internal budget processes spread resources evenly across businesses and opportunities. While this may feel fair to the management team, and all employees, it impacts growth and drives the company to mediocrity. Successful leaders instead make bold budget decisions to redifferentiate the company, usually establishing a major new capability that set off waves of growth.

Even after growth is reignited, companies need to renew their approach as being business insurgents. Companies should view their customers as underserved and their industries as setting insufficient standards, and should constantly emphasize what is special about themselves. Bold goals—not just the aim of living to fight another day—will sustain growth.

Conversely, you should not be scared to shrink your company to become more efficient and focused. By cutting back, it forces your company to focus on what is most important and reduce bureaucracy that does not increase value. It also allows you to dedicate more resources to growing your company.

Obsess over Your Businesses’ Front Line

The second key to reigniting growth is focusing on the front line of your business. As Zook and Allen write, “this obsession, which can often be traced back to a strong founder, shows up in three ways: an elevated status for frontline employees, a preoccupation with individual customers at all levels of the company, and an institutional curiosity about the details of the business.”

Usually, this obsession is what generated growth initially and the layering of bureaucracy chipped away at it. Other companies likely responded to the weakening relationships and provided better customer relationships and hired your best employees. By moving the focus back to what built the company, you can reignite growth.

Instill an Owner’s Mindset

The final component to overcoming stall-out is instilling an owner’s mindset throughout the organization. This is not just P&L responsibility, but giving employees personal responsibility for their actions and deployment of resources. Allow, and encourage, your employees to take risks. Eliminate the bureaucracy (think risk committees or really any committee) that takes decision making out of their hands. Allow them to partner with external companies. Encourage people to form internal teams to test new ideas. The key is give people the power to get things, important things, done.

Preempt stall-out

While the article focused on how to overcome stall-out, more importantly it also implicitly shows how to avoid stall-out. Rather than reaching a situation where growth has stalled, if you leverage the three keys above while still in a growth stage you should continue to grow rather than have to deal with a turnaround.

Key Takeaways

Most successful companies eventually face a sudden, large drop in revenue or growth, stall-out, that is largely caused by an increase in bureaucracy.
To overcome stall-out, companies need to focus on what made them great initially, obsess over their customers and front-line employees and instill a true owner’s mindset where employees are empowered to make key decisions.
In addition to overcoming stall-out, these practices can help growing companies avoid the problem altogether.

The oft-neglected Arabic market

I am always on the look-out for new markets with good potential and a recent article on AdWeek’s SocialTimes caught my attention about the Arabic-language markets. Most of the buzz in the last year or so has been around sub-Saharan Africa, and while that is an intriguing markets most of their economies still lag significantly, and even more so technologically, behind the Arabic geographies.

The article quotes a study from Northwestern University in Qatar that a disproportionately high number of the top Facebook pages, YouTube channels and Twitter accounts are in Arabic. Saudi Arabia actually leads the world for YouTube viewers on mobile (50 percent of videos consumed) and the United Arab Emirates also posts impressive numbers (40 percent).

Games and entertainment represent a particularly interesting opportunity. When you breakdown the regions traffic, entertainment is first or second in every market (jockeying with interest in brands). The UAE, in particular, is a strong consumer of entertainment content.

I am not saying that you should pivot to focus on the Arabic-speaking market but you should look at it as a serious opportunity. Test user acquisition in the key markets (UAE, Saudi Arabia, Qatar and Kuwait). If you see traction for your app, consider translation into Arabic and potentially further localization of your content. In today’s hyper-competitive world of user acquisition, you cannot neglect potentially lucrative markets.

Key takeaways

The Arabic speaking markets represents an emerging opportunity and should be in the same conversation as sub-Saharan Africa.
Entertainment content, and thus games, is particularly successful in these markets.
You should test user acquisition in the key Arabic markets and then consider translation and localization if you generate traction.

Try to be the dumbest person in the room

I have seen many examples of people who want to be the smartest at a meeting, or on an email thread, but the most successful are the ones who want to be the dumbest at the meeting. While it may feel that the strategy of highlighting your intelligence is important for your career or management, the opposite is true. Instead, if you focus on trying not to be the smartest person in the room, you are likely to be the most successful. You will get better input, more creative ideas and improved team performance when you allow others to be the smartest.

Surround yourself with the best

First, you should surround yourself with the best people available. If your goal is to be the smartest, then you are not necessarily putting great people around you. Thus, their performance is likely to be sub-optimal. Great people generate great results and you need to be willing to surround yourself with great people. It is these top performers who drive success.

Not going to learn from yourself

If you spend most of a meeting talking or trying to impress, you are not learning anything. How can you learn when you are talking. If you are trying to find the optimal solution to a problem but focus the conversation on what you are saying, you will cap out at your best solution to the problem, not the best solution in the room. By letting everyone speak and respecting their ideas, you will have the option of selecting the best one. Assuming it is your decision, you then have the option of your best idea or your best idea plus all the others that are proposed. In a worst case, you can still proceed with your idea but now you have many more options.

Everyone has good ideas

If you look at all the fantastic ideas throughout time, you will see that there was not one (or even) a small group responsible for the majority of them. While Stephen Hawking wrote about singularity, Albert Einstein built the theory of relativity, Michio Kaku came up with string theory, etc. The point is that no matter how smart any one person is, there are millions of other very intelligent people. This phenomenon exists on all levels, from the best physicists to the smartest marketers to the best product managers. While you may have some very creative solutions to improve monetization, do not think that others in the room do not have even better ideas.

Great leaders are not great at everything

If you are a great leader, there is no way you are also great at every functional area you are responsible for. You may have wonderful leadership skills, and have risen to that position by innovating on the growth team and building a Unicorn. That does not mean you know analytics better than your lead analyst or finance better than your CFO. You should defer to the experts rather than trying to tell them how to do their work.

Listen

It is not only important to let other’s talk at meetings, it is more important to listen to them. Nobody is going to be motivated to talk if you are not listening. People can tell if you are asking them to talk just to check off a box or whether you and others are actually listening and digesting what they are saying. More importantly, you are not generating any additional value by having people propose ideas or raise concerns and then not addressing them.

Don’t ignore

The above point leads to a critical element of why you want to be the dumbest in the room, you want to leverage the suggestions and ideas everyone has. This is not an exercise in getting buy-in from everyone by pretending to listen to their concerns or advise and then going with your initial idea. The goal is to get the best comments from everybody, have the team work together to synthesize the suggestions into an idea superior to anything anyone (yourself included) initially had. Come out with a better idea, not a perceived feel good exercise that really puts you in the same position.

Measure on results, not sound bites

The measure of success of a meeting, or a working group, or an email thread is not how smart it made you look but that it generated the best possible results. These results are what will also drive your long-term success, not how much you impressed the others at the meeting or on the email (last thought, you didn’t impress them anyway but made them think you were pompous).

Key takeaways

Rather than trying to sound the smartest at a meeting, you should aim to be the dumbest.
It is more important to surround yourself with great people who will bring performance to a level higher than any individual can achieve.
You not only need to get input from everyone but actually use the input to come up with better solutions than you are initially proposing.

Subscriptions 3.0

Although most of my success is with the traditional free-to-play (F2P) in-app purchase business model, the big opportunity will be on layering additional monetization on this model. One old model that I think represents a great opportunity for casual games is the subscription model, a model that pre-dates online gaming. A recent article on Alist, Subscriptions Reborn for Gaming, does a good job summarizing the history and pointing to the future of the subscription model.

Subscriptions in gaming in days past

First, it’s important to note that the subscription model is not new to gaming. The rise of MMORPGs, think World of Warcraft or Everquest, was driven by subscription revenue. At it’s peak (2010), World of Warcraft had over 10 million subscribers (most at over $20 per month).

The importance of subscriptions, however, subsided with the growth of in-app purchases. Most MMORPGs moved to a mixed or purely F2P model. Now. World of Warcraft is the only major product that is largely subscription based, and it offers free play up to level 20.

Other online entertainment have gone the opposite way

While gaming has moved away from subscriptions, it is increasingly important for other online businesses. Amazon Prime, Amazon’s streaming media and free delivery service, with over 50 million US subscribers and about 80 million worldwide. Music has evolved from selling albums or singles to subscription services like Spotify and Pandora. DVDs sales have plummeted while Netflix now has over 80 million subscribers. Thus, in other entertainment spaces, the subscription model is driving revenue now.

Subscriptions in gaming now

While not many games are offering subscriptions, yet, many gamers are already subscribing. Microsoft and Sony both have tens of millions of subscribers to Xbox Live and Playstation Network, respectively, for access to multi-player gaming and new, free games. Electronic Arts is seeing success with its Origin Access subscription service, which for about $4/month gives players access to classic EA games as well as new games before other customers.

The opportunity for subscriptions in gaming

While there is clearly a demand for game subscriptions, one hurdle that remains is Apple’s restriction on iOS subscriptions. With Apple, to offer an “auto-renewable subscription,” that is a subscription that automatically renews rather than asking the customer to purchase it again after a set period of time, you must provide a product that cannot be used up over time, what they call a non-consumable. A consumable could be an hour-long experience point boost in a game app. On the other hand, a non-consumable could take the form of an unlocking a theme, since it could be restored again later.

If you assume that Apple will not change its policy soon, you should not create separate strategies for Android and Apple given the importance of the iOS platform, instead build a subscription model that works for both. While there is no set of best practices yet in the mobile space for leveraging the subscription model, I suggest following the plan below to test this model

Look at micro-subscription, small monthly amounts. $0.99 or $1.99 is not a large burden on players but not only will it generate revenue but will get them further invested in your product.
Consider multiple subscription tiers. $0.99 for the silver subscription, $4.99 for the gold. This provides opportunities for your most engaged players to get the most benefit but is also accessible for all players.
If you have an in-game VIP or loyalty program, offer subscriptions for players to move up or stay at a certain level. I would pay $10/month to retain my Platinum Status on American Airlines, let other people buy into status (plus it puts a monetary reward on it for players who earned it).
Decide whether it is a company wide subscription (like EA’s Origin Access) or if it is game specific. The former obviously makes sense only if you have, or plan to have, a broad range of titles.
Decide what to include in the subscriptions but always test. Different options include early access to new content or games, discount on purchases (which also may include IAP monetization), special avatars or themes or a regular XP boost. The benefits are game/company specific but should be broad enough to ensure a majority of players would see value.

As the model evolves, it will be interesting to see what does and does not resonate with players. By watching the space, you can learn best practices and build from there.

Try it

While the subscription model is unproven in casual games and there is no defined model on how to do it right, you should still try it. It is increasingly difficult to monetize mobile apps, or at least monetize at a level that covers your acquisition costs. By adding subscriptions, you may find a secret to increasing lifetime value and thus enabling growth.

Key takeaways

Gamers have responded to the subscriptions model since MMORPGs, though it lost favor to in-app purchases recently.
Other areas on online entertainment – music, film, video – are driven by the subscription model.
Subscriptions represent an opportunity, though currently unproven, to increase revenue and customer lifetime value.

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No excuses

Not rah-rah

It’s above the individual

It’s about the process

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Give yourself a fighting chance

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Focus on your core offering

Outsource what is not primary

The key to success

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Learn from every failure

Share the lessons

Review your pattern of failure

The benefit

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Generate a plethora of ideas

Developing a sense for good ideas

Cultivating both cohesion and dissent

Ideas are the first step in innovation

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Surprisingly strong activity across devices

What it means for messaging

What it means for games

The benefits are worth it

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Rediscover your insurgent mission

Obsess over Your Businesses’ Front Line

Instill an Owner’s Mindset

Preempt stall-out

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Surround yourself with the best

Not going to learn from yourself

Everyone has good ideas

Great leaders are not great at everything

Listen

Don’t ignore

Measure on results, not sound bites

Key takeaways

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Subscriptions in gaming in days past

Other online entertainment have gone the opposite way

Subscriptions in gaming now

The opportunity for subscriptions in gaming

Try it

Key takeaways

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