Given the importance of working with platforms and intermediaries to tech and game companies, managing the relationships with the platform becomes crucial to your success. A Harvard Business Review article earlier this year, “Mastering the Intermediaries” by Benjamin Edelman, lays out a strategic framework for optimizing these relationships.
Regardless of your business, if you are not a platform you probably rely on one or another type of intermediary for your success. Airlines and hotels are at the mercy of Kayak, Orbitz, Priceline and other platforms. Game companies rely on Facebook, Google and Apple for their access to customers. Small restaurants use Seamless or Foodler to reach hungry customers. Manufacturers must sell through Amazon to gain access to a large market. Moreover, almost every retailer looks to Google to refer customers.
These intermediaries provide valuable benefits (hence why everyone works with them) but they can also capture a disproportionate share of the value a company creates. These costs, also, do not dissipate through competition as most markets usually only have one or two significant platforms (mobile phones, anyone). Thus, companies feel they have no choice but to accept the fees and rules the platforms institute. Edelman’s article, however, shows strategies for recapturing some of the value companies are creating and protecting yourself from abuse by the platform. Continue reading “How to deal with Apple, Facebook, Google and other platforms”
The recent jury verdict recommending Samsung pay Apple $1 billion in damages for violating patents is likely to have a significant effect in the social game space. Although the Apple/Samsung legal battle is likely to continue for years, the jury’s decision shifts the playing field. In my experience, once there is a decision of this magnitude, the loser (in this case Samsung) is so on the defensive it ends up settling much to the favor of the original victor (Apple). The decision will not put Samsung out of business (though a billion dollars is a lot of money for anyone, and theoretically it can suffer a penalty three times that amount) and it really does not matter if Apple has more cash in the bank.
Continue reading “What the Apple/Samsung jury verdict means to social game companies”
It seems that the talk of the social gaming space is about Bots and using them to manipulate the iOS charts. It started with rumors that several companies were working with a “marketing” firm that actually just used bots to create fake downloads to move games up the free charts, to more rumors that this manipulation was being done by low-wage labor to even more rumors that it was Chinese slave labor. My guess is the truth is somewhere in between but what I find humorous is the high and mighty attitude some in the industry have taken. There may be some companies that knew what was going and decided not to partake, though why they did not report it to Apple or the press confounds me (and is bad business, as it put them at a competitive disadvantage). There are probably more companies that just did not know how to move up the charts in this manner. For the record, fiveonenine’s first iOS title will come out a few weeks so we do not have to make this “choice.”
What I actually find more interesting is that Apple did not stop this practice sooner. Given how widespread everyone in the industry knows it is and more importantly how even basic analysis of the traffic (i.e. tons of downloads with zero retention), Apple had to have known what was going on. Thus, they apparently decided not to stop it until the press made an issue of the manipulation. Furthermore, given how beautifully Amazon polices its customer ratings (they very diligent about eliminating fraudulent comments or those made by people even remotely tied to a product), Apple could stop the manipulation of its charts anytime it wants to.
All that said, what really matters to mobile social game companies is that this development reinforces the need to have a robust marketing strategy (and yes, insert here the trite comment that they just need to make good games that will naturally go high in the charts). Those companies (even if they are tiny) that relied on this “marketing tool” for their installs are now left dry, they need to find quickly a way to replace the installs generated by being artificially moved to the top of the charts. Companies, however, that have multiple marketing channels (performance marketing, web advertising, PR, social media marketing, etc.) can now just alter their marketing mix and maintain their business. This latest little controversy is just the most recent piece of evidence why it is necessary for social game companies to create full and robust marketing strategies for their games rather than rely on one tool.