http://www.edge-online.com/features/young-bucks/
Their fingers may be stubby, but children seem preternaturally adept at grasping the true function of new technology: games. If you’ve seen parents taking their young children out for a meal lately, you’ll probably have witnessed the child’s inevitable request for a smartphone to play on. Maybe you’ve also heard them utter the cry of a generation: “It’s only 69p!” Or perhaps they’ve simply demanded an App Store password.
No longer restricted to a brief spell of pestering outside a local game shop, children’s access to games is now untrammelled, whether at home on browsers, or out and about via smartphone marketplaces. And this means that our kids are quietly reshaping the entire entertainment industry right under our noses.
Of course, given our medium’s history, it wouldn’t be remiss to expect the driving force behind industry shifts to be men aged 16-34. And yet, according to entertainment consulting company KZero, the single biggest group purchasing virtual goods is children under the age of 15. At the same time, the growth in virtual goods revenue is skyrocketing, rising from $0.9 billion in 2007 to $9 billon in 2011. This year alone, it’s estimated that kids could end up spending a staggering $7 billion on virtual items. At least they can’t leave them lying all over the floor.
It’s not just virtual items that kids are driving sales of either. While there’s no hard data on exactly how many units of Angry Birds were purchased by children aged ten and under, it’s a vast number if the sales of merchandise are anything to go by.
The important point to take from all of this is that we’re witnessing something new. Today’s under-13 market reflects a seismic shift in consumption patterns, perhaps the biggest since TV adverts started to be aimed at children. We’ve raised a generation that’s more demanding, and discerning, than ever before. Today’s youth have had access to touchscreen devices for most of their lives, and Internet access has been pervasive for them. Immediate purchasing systems, such as the App Store, have eroded the concept of delayed gratification.
The impact of this is reverberating well beyond the game industry. Toy companies such as Mattel are facing the prospect of their market being turned upside down. Twenty years ago, the likes of Optimus Prime and Barbie were designed by adult professionals. Now new brands are being generated from the ground up as online games fuelled by the under-13 audience create new demand.
t would be fair to say [kids’ games] have rejuvenated these industries,” says John Leonhardt, president of the Dimensional Branding Group. “Manufacturers will continue to rely on certain tentpole franchise makers like Marvel and Pixar, but they’ve moved away from feature films as the sole source of new properties for consumer products.”This transition from games to toy brands has happened rapidly. Widely regarded as having written the blueprint for the transmedia strategy, Moshi Monsters had some of the bestselling toys at UK retail during Christmas 2011. Last year, Stardoll launched its own clothing range with US retailer JC Penney. According to the Wall Street Journal, Rovio is set to sell $400 million worth of plush toys based on Angry Birds in 2012 – double what it sold last year.
Then there are the games on the path to ascendancy, such as Fight My Monster. A digital trading card game started by two guys in a garden shed in England, it was courted by major licensing groups before signing with Striker Entertainment. The company is now based in Silicon Valley and has over 1.5 million users.
Once the creative masters of their world, traditional toy companies are now having to react to such interlopers. Interactions are mostly still in the form of merchandising deals at the moment, but a wave of acquisitions seems likely. Indeed, Saban Brands, the owner of Power Rangers, announced its acquisition of Zombie Farm creators The Playforge in August. Meanwhile, Nic Mitham, CEO of KZero, believes that “the majority of new massmarket kids IPs will begin life as games, then port over to other media channels”.
The size and influence of kids’ gaming raises the question of why major social publishers seemingly haven’t embraced the trend yet. “Social game companies do not have direct access to the kids market [because], primarily, Facebook can’t reach these younger gamers,” says Mitham. “Social gaming companies are heavily reliant on leveraging the Facebook social graph and exploiting push mechanics, email, messaging, etcetera. [The kids market requires] a totally different mindset, and requires much more agile marketing and user profiling.”
An additional barrier to entry for many games companies is the legal landscape. The nature of legislation such as the US’s Child Online Privacy and Protection Act (COPPA) make it a difficult place to begin as a startup.
Yet from the companies that have forged into the space, some surprisingly old-school marketing strategies are emerging. TV is frequently referenced by Moshi Monsters maker Mind Candy as helping fuel its early growth, an approach now copied by many of its competitors (including Bin Weevils). Online video has also become a huge driver for game discovery. Outfit7’s Talking Friends series of apps has used online video to phenomenal effect, with over half a million videos uploaded to YouTube by its players.
Indeed, a study released by consultancy firm Dubit in August showed that 71 per cent of 6 to 11-year-old kids are now playing mobile games. Although the average spend is only a third of that on toys, we can expect more growth.
But perhaps the most exciting trend is towards kids becoming developers in their own right. Dylan Collins, chairman of Fight My Monster Ltd, says: “The next Disney is going to be a company that can produce really amazing content, but also one that can develop tools for kids to create their own. At some point in the near future, you’re going to see the first 15-year-old millionaire being created – [teenagers] now have the tools and frameworks to create their own games, apps and movies.”
“It depends on if it’s fun,” says Casey. “I’ve played tons of kids’ games that I think are way better than games made by big companies. Nobody knew kids could do this. But now with [coding initiatives like] Coder Dojo, I think [publishers] will be on the lookout. I think the next Notch will definitely be younger. Now kids can put things online with the click of a mouse.”
Even for kids who aren’t interested in developing their own games outright, younger gamers are embracing the idea of user-generated content in a big way. Roblox, an online playground that allows its users to create their own games, recently hired a 19-year-old player whose designs had been played over 10 million times.
Games retailers continue to insist they’re keeping calm and carrying on, too. In a recent interview with the Financial Times, GameStop CEO Paul Raines said that stores will be around for a long time because they are “a place to go for a community of gamers to talk about and discover games”. However, anyone who has kids will tell you that the school playground is where they discover new games. With the convenience of the various app stores, Steam and more, it’s hard to see how physical retail will play a major part in their gaming life as they get older. It seems that Game’s recent demise and rebirth into a much smaller company is likely to be the reality for GameStop as well.
Finally, this generation of kids is probably going to have the most demanding set of usability expectations yet. With the increasing power and availability of game engines, the point of difference becomes interface. “Hand and body gesture controls, speech controls and touch screen interfaces are becoming a fundamental part of UI design in all parts of the game industry,” says Jonathan Ball, director of Pokedstudio. “I have a hard time getting my five-year-old daughter to use a keyboard; she always wants to touch the screen and expects things to move when she ‘drags’ them. This generation only knows touchscreen interfaces, and designers need to build an understanding of how to work this best into games and user experiences, rather than it being an afterthought.”
Given the disproportionate impact that kids’ gaming is having on the wider entertainment industry, there’s a good argument to be made that this is far more strategically valuable than the currently in fashion ‘mid-core’ sector. “Kids’ gaming is something of a holy grail,” says Dylan Collins. “It occupies the intersection of games, TV, toys and online video, while also generating revenue from both physical and virtual items. But at the same time, the games they’re playing today are reshaping their future play and consumption patterns. It’s going to be pretty disruptive when they get older.”
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