Why Facebook Games Must Get More Creative

Although Facebook has restored some viral marketing options for social games, these applications still have fewer options for word-of-mouth promotions than in the past. This has driven up the average cost to acquire new players by up to 30 percent for some studios.

Amid declining virality and active daily users, social game companies have been scrambling to re-evaluate their business models.

Two things happened as a result of the decline in virality:

Developers anticipating that viral channels would be a less viable option to acquire users pivoted their focus to retaining avid users by focusing on analyzing and optimizing user behavior to drive higher monetization. The social gaming 1.0 companies that were not able change their approach and philosophy to development have disappeared from the market.Get Creative

The net result is that social game companies have been forced to become more creative with development.

Games have become more engaging, and upcoming titles have started to focus on newer genres like finding hidden objects.

Monetization has seen a steady increase among companies with the resources to build the next generation of social games. But small, independent developers have faced more challenges.

Facebook has attempted to resurrect viral channels in fits and starts around passive channels, where some users who played games would see a marketing message that was not controlled by the developer or another user.

These passive channels, called discovery feeds and game requests, are ineffective in increasing viral game adoption. There are two reasons why.

Psychologically, only peer-to-peer viral channels are effective in driving long-term user engagement and retention. When Facebook tries to become the marketer, the incentive changes and viral options are rendered useless for social game developers. Viral word-of-mouth marketing must fundamentally be peer-to-peer. Notification channels also have a significantly longer shelf life as a viral channel. Because they stick around longer inside users’ profiles than fleeting news feeds, they have a higher chance of being seen and converting users to installs. Viral channels must be sticky.

It’s not in Facebook’s best interest to create an ecosystem where only large social gaming companies can thrive. More competition means:

Better costs per impressions or clicks for Facebook ads Higher quality games for a larger slice of the user base More purchases of virtual goods and Facebook credits.

Indie developers believed in Facebook as a distribution platform specifically because they offered their hundreds of millions of users the ability to freely share ideas, thoughts, news and yes, games.

So while the pendulum swung hard to the left and knocked out the weaker players, it strengthened the surviving participants and forced social game developers to think like, well, game developers.

Social Gaming 2.0

The entire industry is now moving toward a new paradigm: Social Gaming 2.0 is here. Expect more innovation in game mechanics, deeper game play, and most importantly, games that have been developed to be truly social.

Facebook can ensure the continued growth and evolution of this industry by continuing to innovate around viral channels as a means of discovery.

Expect to see continued experimentation from Facebook on how to open viral channels back up in the next few months.

The company just announced the re-opening of game messages on news feeds under special circumstances.

Facebook has to strike a balance between user experience and distribution, but also must restore virality in a form that triggers deeper engagement on social games. This can only happen when people are the key influencers, not platforms.

Guest writer Jeff Tseng is chief executie officer and co-founder of Kontangent.

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