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Video Game Analytics: Revolutionizing an Industry

Gaming companies need to look to data to increase profits

30Oct

Back in 2008 it was reported that 97% of teenagers in the US played video games on a regular basis. The stats in 2015 are equally impressive. There’s an average of two gamers per American household, with four out of five homes owning a games console. The biggest change, however, is the increase in the average gamer’s age. Now, the average male player is 35 years old - remarkable when you consider that the industry had traditionally targeted teenagers.

The reasons for this change are twofold. First, where gamers would previously give up playing once they had a modicum of responsibility, they now use them as a means to alleviate stress. The second is the role of smartphones and the emergence of free-to-play games. Candy Crush, for example, has become a craze in its own right.

Basically, the video games industry is booming. It’s expected to be worth $82 billion dollars by 2017, a $15 billion rise from its current valuation. But as reported by Forbes, many computer companies are approaching this purple patch apprehensively, with Teradata Perspectives stating that they’re ‘unprepared to generate revenue from this onslaught of new customers.’

Free-to-play games have been hugely successful, but are not always commercially viable for developers. It was reported that only 0.6% to 6% of those playing games which charge for additional content actually part with any cash. And while this group remains important, they do cost manufacturers money in the form of support and server issues.

Getting them to pay for premium content is the next mission. And increasingly game companies are relying on real-time analytics to strengthen their relationship with the majority of their users. By analyzing individual interactions, gaming companies can improve user experience and game longevity. Developers need to understand engagement levels so that they can target ads optimally, instead of the current system which most free-to-play games adhere to - spamming out arbitrary messages for new weapons and extra lives.

The free-to-play model is still in its infancy, and the need for user information is increasing substantially. A number of companies - like deltaDNA - lead the way in terms of giving gaming companies this data, but they will surely be joined by others as game creators begin to center their strategies around specific customer insights.

The increased projection in market value demonstrates that there’s revenue to tap into. But those companies which don’t make use of their data will find that this opportunity could be squandered as quickly as it’s arisen.

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