Socio-cultural. Take into consideration the social factors that could affect the development of your video games company. There are a number of studies available on the internet where you can probably take a glimpse of the cultural diversity that exists in Asia. There is no “one solid definition” of an Asian, I believe. The Philippines, for example, is quite “Americanized” in its values with a tinge of Spanish – and to a certain extent, they love entertainment and the youth’s entertainment options are beginning to expand significantly and their expectations of traditional media such as TV and radio are being transferred to new things such as games. Singapore is quite liberal in its views due to its being very economically developed, though they put a premium on education and success. This I think is the first step: How will your company play out against these socio-cultural undercurrents and forces? How will the games attract these consumers?
Technological. I am assuming that your product line will encompass both PC, ‘wired’, and streamed/online games. If this assumption is true, then a technology audit is necessary. Again, a rough estimate of Asian internet penetration would put it at say 10% and perhaps PC ownership at say 20%. However, that varies across. Knowing in-home PC penetration AND actual access to the internet across Asia is critical. In developing countries such as Vietnam, Thailand, and the Philippines, there is low in-home PC penetration, low in-home internet penetration, and low broadband connection, however, internet cafes are a big thing. How can your business model accommodate that? Should it even be a part of your business model?
Economic. Of course, economic power needs to be understood. This could well be in the usual form of GDP per capita (at PPP). However, note that this is rather misleading: in some developing countries, there is a wide gap between the rich and the poor. You will have to look at GDP per capita on a per-city basis, rather than on a national basis. Difficult to look for data, but not impossible.
Environmental. Are there environmental factors that you need to consider? I am not sure if this is relevant in your case.
Political. As a video games company, you will be creating intellectual properties that can (and will) be pirated and copied and distributed. It will put a drain on your revenue potentials. You need to know the political landscape on this regard. You also need to understand the intricacies of each market: Given the continue popularity of internet cafes and gaming cafes, for example, governments – national, regional, and local might start putting a tab on licenses for internet/gaming cafes, as well as a tab on the type of content you are offering.
I believe that if you looked at these initial factors, you will be able to see what are the barriers, and from these, infer what you can consider as key success factors.
A few other points (and I apologize for taking so much space): Your business model – will it take into considering the emerging digital marketing communications landscape in Asia? South Korea, Taiwan, Singapore, and pretty soon, Urban China, Urban India, and Urban SEA will be big on “branded in-game experiences”. Can this be incorporated in your business model?
I have always found Kepner-Tregoe’s rational decision-making and critical opportunity/threat identification processes interesting. If you have their book on rational management, that might be a good starting point to start drafting your first key success factors.
Hope this helps.
posted March 15, 2007 | Report answer as…
Joseph H. Boussidan
Entrepreneur, General Management executive. Consultant to ventures on strategy, business development and operations. see all my answers
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For any business, key success factors are: micro-management, product innovation and stellar marketing. Having management involved in the various steps of a product lifecycle is essential to making killer products. Killer products will bring killer profits. Innovation is the prime differentiator in a competitive market. Stellar marketing is to leverage your brand capital in an unconvenional way.
For technology products, it is also essential to understand the various usage patterns and cultural differences of your target demographics, in order to shape an appropriate user experience. To that end, some of the global companies (orange, nokia, …) are actually forming user focus groups (using statistically defined criteria to have a close reprensentation of the target population), have them on some sort of retainer, and submit to them alpha versions of their products in order to determine product market acceptance, and also to fine-tune its appearance, features, etc. before market launch.
The video game industry is no different for that matter.
posted March 13, 2007 | Report answer as…
17 years internet/new media experience.
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Simple: make sure your games, your products, are what people want to play. This makes marketing them that much easier and as most marketing with regard to video games can be completely undone by bad reviews it’s an absolute critical part of the pie.
Have first class QA and bug testing and solving – ensure your version process is second to none – I’ve seen a brilliant game fail because it was put out as a release in what was really beta version. posted March 13, 2007 | Report answer as…
Regional Sales Manager at Motorola Solutions
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I’ve been in business development with HP for years, and in the software/entertainment publishing business as well…. I have consulted with companies like Sony, Logitech, Activision, and Parker Bros. – I helped bring of 200 titles to market in the past 20 years… many of them were great products that sold great, others were great products that sold poorly…. and there have also been a few that were marginal products that still sold well! The key is to establish a credible business channel -let your distribution partners know that if your product does well, you will bring them more… and if it does poorly, you will still be a viable partner in the future. In the Asian Market, it is all about building euity in personal trust – not just having the best product. The other thing is to make POSITIVELY sure you have your business processes in order… if you know WHAT to do before you have to do it, then you can make the best decisions when the time comes… if you have to decide what to do “on the fly”, you will make mistakes that come back to haunt your business.
I may not be the best guy to answer this but I am avid gamer and can give you what gamers want. The key factors according to me would be:
a) Customer Segmentation Strategy (Identifying the target audience) c) Market Segmentation Strategy (Identifying the right market to start with) b) Pricing Strategy (Identifying the price the various segments would like to pay for the games) c) Promotion Strategy
There is no right answer to your question but I hope this helps.
posted March 14, 2007 | Report answer as…
Manager – Walt Disney Studios Home Entertainment
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As others have said here, understanding your target market is extremely important. Cultural aspects can be a huge factor into what types of games will sell in a particular region. Very few of the popular games in Japan are successful in the U.S and vice versa. In China, online role playing games (RPG’s) are much more popular than other types of games. That being said, there are games that have crossed cultural and international boundaries such as World of Warcraft, Super Mario series etc.
As for strategies, I would suggest
1. Read all sorts of stuff (history, culture, current events, sports etc) about the region that you are targeting. 2. Spend time in the region of interest studying your target market and the types of games they play 3. Create a demo/free/shareware version and test it with the target market as well as game reviewers to get feedback (The immensely popular DOOM was initially available as shareware) 4. Create a game that not only your target market thinks is fun but also YOU think is fun. 5. Learn from your competitors
6. Don’t be afraid to be different and create something new and unique(selling people on things they want is easy…making them want and need things they never knew existed can be much more fun and rewarding…case in point..the Nintendo Wii)
For me, key factors for success doing biz dev in Asia have been:
A) Understand AND RESPECT the cultural business process for each entity you deal with. There are significant differences in the way difference entities conduct their business, and I don’t just mean from country to country. For example, two publishers in South Korea may have VERY different ways of deciding with whom they wish to do business. I recommend recruiting someone that knows the entities well and who is well respected to represent you, and conducting your first meetings as a pure “get to know you” experience. Don’t worry about coming away with a deal the first, second or even third time.
B) Be direct. Be honest about what you do and don’t know. This is universal, but it has served me well in Asia. Potential business partners will respect you more if you are genuine and self aware.
C) Be social. What happens at dinner is perhaps more important than what happens during the day.
D) Build partnerships. The people I’ve continued to come back to over and over again in Asia have become strong allies. They know I’m going to look out for them even when it doesn’t directly benefit me.
A small detail that hasn’t been covered… don’t make the mistake of many companies that went under because they focused all of their resources into one major game. If the time-to-market is too long, you will need to release something in the meanwhile to keep everything floating, even if it means releasing a game that’s less innovative.
Another thing to consider is how much focus you want to have in game development, rather than distribution. They’re quite different; having your lead programmer as head of marketing may not be the best idea.
Service Partner Manager at Vodafone Global Enterprise (in Singapore) see all my answers
My approach will be simple and straight forward…first is understanding the market, defining opportunities is second and third is looking at your target market. The next place to look at is who are the players, what are the offerings and how mature is this market and what is the impact on future trends…is there an opportunity to sell?….Then finally you may want to look at figures in market research to validate if the business is worthwhile…in Asia video gaming is a rising industry, however, it is only prevalent in countries where the internet penetration is high, socio economic status is above average where people can afford, telecoms infrastructure can support highspeed service to consumer, affordable internet services, lifestyle, social acceptance of gaming activities is high etc.