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What does free-to-play mean for retail?

Christopher Dring speaks to major free-to-play studios to discover if the High Street has a role in their futures

THERE’S no hiding the impact that digital games is having on retail. The sales decline seen this year may be driven by the aging console cycle and the economic downturn. But the fact that more games are coming out digitally and fewer are released physicaly is having an effect. “Games retail will die off, whether we want it or not,” says the CEO of Wargaming, Victor Kislyi, the publisher behind World of Tanks. “Games are digital products. They’re zeros and ones. Yet we’re still selling them in physical boxes on shelves. That is the exact manner that people were selling tomatoes 5,000 years ago in Babylon. “We released a handful of titles at retail. We barely survived. It was a risky but bright decision for us to burn bridges with retail and go digital. “With us, as soon as the polishing procedure has finished, the game will immediately be available to 35m players. Isn’t it cool? If something goes wrong, we tweak it. With a retail title, if there’s a bug, you wait for a patch. Retail philosophy is first month, and they don’t care what happens afterwards. Here, we have

to care about our game and make it stable for the next ten years.” Bigpoint chairman Heiko Hubertz believes games retail has a future, but its role will have diminished. “Retail’s role will only be for special versions, merchandising and pre-paid cards. Not for distributing games.”

WORD ON THE STREET Other free-to-play companies are not so eager to dismiss retail so easily. “There is indeed a place for retail in the entire space,” insists Carsten van Husen, CEO at Gameforge. “We take pride in having access to people digitally but these are not the same people who frequent the High Street. That’s a significant audience.” David Reid, CMO at CCP – the firm behind free-to-play PS3 game Dust 514and subscription MMO Eve Online– agrees: “Retail remains a fundamentally important place to discover games for lots of people. “Historically for us retail has not been an important part of Eve Online. And coming into the company, I’m like ‘geez, this is a missed opportunity’. “I don’t think for a minute retail loses its importance in the next

Several free-to-play experts do see a role for specialist games retail in their market

generation. It’ll be different, but you can see the rack of points cards – principally for digital titles. And those are high margin products.” Indeed, Bigpoint is launching retail games via a partnership with Excalibur. Even Wargaming, with its

We’re still selling games in boxes. That’s how people were selling tomatoes 5,000

years ago in Babylon. Victor Kislyi, Wargaming

belief that retail’s time is over, has built a World of Tanksboard game. And those free-to-play firms that are already utilising retail, says it is proving a lucrative avenue for them. “We do a significant part of our

THE FREE-TO-PLAY online games market undisputedly attracts a huge number of gamers. However, the age old question of how to

monetise these followers still remains in the forethought of many developers. InComm has a relationship with Jagex in the pre-paid market and this year we teamed up to promote free- to-play game RuneScape.

The promotion was geared around encouraging gamers to purchase a £12.99 90-day membership card which unlocks an array of in-game

20 November 2nd 2012

content in addition to the free-to-play content, such as more than 150 quests and story arcs, new skills, 20 mini-games, the ability to construct your own home and explore a world three times larger than in the free game. The promotion was in conjunction with one of InComm’s major UK retail partners. The exclusive ‘Virtual Item Promotion’ enabled purchasers of the card to use a ‘Katana virtual sword’ in- game, which was only obtainable through redeeming a 90-day membership card. Effectively adding value to the card, and sales of it spiked,

resulting in an uplift of over 425 per cent during the promotional period. The promotion was so successful it won Best Prepaid Marketing Campaign at the Prepaid Awards 2012. Activity combined in-store, online and social media advertising, ensuring the offer reached the widest possible audience, targeting new and existing players. Adding value to a great free-to- play game can open the door to monetisation. Develop great content and combine it with a tempting offer and gamers will part with their cash. InComm: 01489 556 700

business through retail with cards,” says Jagex CMO David Solari. “Retail gives us access to audiences we otherwise couldn’t engage with. I see the role of retail growing as there are many other ways we could work with them.” Yet does free-to-play need specialists like GAME or just mainstream outlets like Tesco? And is there enough revenue in points cards and merchandise?

These things are far from certain. But retail is doing its best to stay relevant by becoming customer ‘experiences’. GAME is building a core userbase that freemium firms can utilise. HMV wants to promote mobile titles alongside its technology products. Meanwhile, GameStop is making its own free-to-play titles. Wargaming’s Victor Kislyi may be correct when he says retail isn’t necessary to distribute games. But as a marketing tool, the High Street certainly has a role to play.

CASE STUDY: INCOMM AND JAGEX InComm marketing boss Hamish Jardine talks us through how the firm used retail to help push Jagex’s MMO RuneScape


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