A Deep Drink From The Fountain of Eastern Europe and Russia

Tatiana Chernova – Alawar Entertainment

Eastern Europe develops around 30% of casual games, and it should now be looked at as a very viable game market and not just a place that's cold. Russia, Ukraine, and Belarus are the largest developers and consumers of casual games in Eastern Europe. In 2008 about 3.5 million casual games will be sold in Russia with revenues approaching 30 million, despite the market not even existing prior to 2004 because of the poor economy of the region.

Moscow and the Volga area are the largest markets in Russia. Internet users in Russia will reach 50 million by 2010. One in five internet users in Russia play casual games. Unlike the US where casual games skew to an older market, Russian casual games skew towards middle age (office workers) and children. People over 40 tend not to use the internet, so it's a young people's market there.

Credit card penetration in Russia is very low. Payments via SMS are the primary way to buy casual games in Russia. Up to 96% of casual game sales are handled this way. Since SMS payments were made available, the commercial casual game market grew by 25x.

The cold climate of Eastern Europe does affect casual game sales, as the sales of casual games in Russia tend to be seasonal, and people tend to “hole up” in the winter and play games. Game prices in Russia hover around $8 (including VAT), although this is expected to rise until the norm is around $10.

Most popular genres are Time management (Farm Frenzy, Build-a-Lot, Supermarket Mania, Jenny's Fish Shop), and hidden object games (Treasure Masters Inc).

While people will buy English language games, there really is value to localizing your game. And it's important that the release-date of your localized game be near the release of your English version. If your translated version lags a year or more behind the English version, it likely will not be a success.

Alawar.com controls about 85% of the casual games market in Russia.

Software piracy is a problem, with piracy being the norm rather than the exception. The SMS system has made things better by making purchases more convenient. Piracy was largely a problem in the past because easy methods of payment were simply unavailable.

Going International – Entering New Markets: What to Do and What to Avoid
Luis Ongil – CEO GameDuell

Most of the growth in casual gaming (80%) is occurring outside North America. The games themselves translate well.

Payment is an important factor. Every country has its own favorite payment method.

Every market looks at things different, culturally. Ads in the US show people experiencing the product rather than the product itself. For example, iPod ads outside the US don't show the dancing silhouette people, as many locals didn't understand what the product was.

User conversions differ. The funnel from the product presentation to the actual product purchase is longer outside the US. It's important to give users a longer presentation before ushering them into paying for your product. Click-throughs are higher in less-developed markets. User registrations are quicker too.

Email rules and regulations are different from country to country, especially regarding spam. Make sure you research the laws regarding email before you start sending them out or you'll find yourself blocked at best case.

You need to localize your customer service. Not only regarding language but also the logistics. People in Europe are more likely to contact customer service if they have a problem rather than toughing it out.

Localized payment methods are required and work in different markets. Whether your payment system is debit, credit, prepaid card, SMS, or even an offline bill-paying kiosk, you must research your requirements prior to launch. Make sure your provider accepts cards and methods from different countries.

When going international, you must plan before you start or you'll run into problems later. Know your markets and what markets you plan to target before you move into them. Even things you'll take for granted like the appearance of card-faces should not be assumed because they look different depending on your country.

Ways to internationalize

1. Build a subsidiary in the target market. Let the company license your product and handle the fulfillment and support.

2. Do everything from the headquarters. This is feasible if your company is in Europe and you want to target other companies in Europe. You will gain economies of scale, but you will lose local knowledge.

3. Build a remote branch and branch to the neighboring localities from that.

Why go international? The question should really be “why not?” Pay attention to your cultural differences, payment methods, how you will expand to that market, and how your game will work internationally as a ground-up process rather than something that's added on at the end.

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