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Financial Current market state for web games

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I used to earn a lot of money with Flash games 5 years ago. Either by selling whitelabel games to portals or just publishing them on MochiMedia, i was earning about $500/month. Since MochiMedia died and the popular FGL website all died, and everyone went to mobile, i stopped working with that. I was thinking about returning, but i'm curious about the current market state.

  • Is anyone earning money selling games to portals? Are portals buying that? If so, where's the current hub for people to do business on?
  • Is anyone earning money by putting ads into their games and publishing to portals?
  • Is anyone dedicated to desktop web games?

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If you did decide to go back into this I would look at picking up an html5 framework as flash is almost dead.

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Hi,

It is a very interesting topic indeed and one that I've had the chance of discussing at length recently. 

I don't think there's much of a 'public market' for web-minigames. Sure, there's Kongregate, which is still awarding games of the week / month and allows for rev-share on ads, but I don't think you'll profit a lot from that.

What you could end up finding however is a larger business that intends on maintaining a strong web presence but generally won't work with vendors because of their fee. By undercutting on price (which virtually has little to no effect for a man going solo with or without freelancers for art) you can become a valid solution for a business like Warner and the likes. If you've made a lot of flash games before, show them, might work out.

 

As for HTML5, I'm really not sure about that. There are a lot of frameworks, and it feels like making anything requires to learn something new. Would suggest using Unity's webGL exporter which has come a long way, and is progressively getting more traction with browsers.

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I'm not really worried about learning curves, or learning a new system. That's not really relevant and usually is fun. What really matters here is that if there's is good money to be grabbed.

Does anyone know any public revenue reports from developers on Kongregate or other portals? Are we talking about few cents a day or more Flash-like numbers like 1 or 2 dollars a day, from ads?

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Posted (edited)

Well, there's True Valhalla and another guy who posts regularly on /r/gamedev (I'm afraid I can't remember the name and therefore can't currently search for a link) (devMidgard) who both make decent money making HTML5 games and publish monthly income reports. Both of them seem to make the majority of their income either licensing games or doing work-for-hire.

Edited by jbadams
Fixed broken link, added additional link.

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I'm not really worried about learning curves, or learning a new system. That's not really relevant and usually is fun. What really matters here is that if there's is good money to be grabbed.

Does anyone know any public revenue reports from developers on Kongregate or other portals? Are we talking about few cents a day or more Flash-like numbers like 1 or 2 dollars a day, from ads?

I have figures, though I don't believe the devs would like me to share them.

I have it on good authority you could make a few Ks on ads alone if you have something good enough.

The big difference between then and now is using incentivized ads instead of just relying on the usual ads.

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Marketing is incredibly important.

Consider that in games with an already established brand, about the same is spent in marketing as is spent in development. In brands that are not established the spending is often even higher, 1.5x or 2x the cost of development.

So if you're considering your own pay for development, if your professional wages would have been $10K or $20K or $50K, then the marketing spend might be $15K or $30K or $120K until the brand is established.

Also, one game is not a business plan. The first several games help you build your skills and talents. It often isn't until the developer has put out multiple products that success comes. Then people will play one game, find it fun, and look at the others and purchase them too. The more you put out and the more advertising and awareness that exists, the more they'll come pick up other products and build a community of repeat players.

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Marketing is incredibly important.

Consider that in games with an already established brand, about the same is spent in marketing as is spent in development. In brands that are not established the spending is often even higher, 1.5x or 2x the cost of development.

So if you're considering your own pay for development, if your professional wages would have been $10K or $20K or $50K, then the marketing spend might be $15K or $30K or $120K until the brand is established.

Also, one game is not a business plan. The first several games help you build your skills and talents. It often isn't until the developer has put out multiple products that success comes. Then people will play one game, find it fun, and look at the others and purchase them too. The more you put out and the more advertising and awareness that exists, the more they'll come pick up other products and build a community of repeat players.

Are you sure about this marketing ratio for solo html5 devs?

I'm the small sample I'm well acquainted with, I was happily surprised to see a grassroots approach had a lot of ROI and therefore allowed to focus on development of multiple smaller titles (as opposed to 50k games for example).

My advice would be to focus on 1-2 games per month and hit all the portals you possibly can. Ads revenues won't be impressive at first, but they will stack.

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Probably not for solo html5 devs, however, most make approximately $0 from their few hundred spent in marketing efforts.

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      Another principle to remember: Customers are not necessarily truthful and forthright. They may have objections but haven't shared them with you. If they don't share them, you have no way to overcome them -- and your sale dies right then and there. Inoculation is the best defense against this.
      A further benefit of inoculation is that by bringing up your perceived weakness yourself, you gain credibility and show that you can think critically. This goes to character, and people generally want to work with credible people who can think critically. So how can we inoculate against those three example objections?
      You've never made a game before. Early in the presentation, like when you are sharing your background or how you came up with the concept of the game. Say something like, "Now this is the first game I'm making myself. However, I have X industry experience doing Y. I also have two mentors who have released several titles that I meet with regularly. When I don't know what to do, I lean on their experience. " Your selected genre is oversaturated. Mid-presentation, show some screenshots or demo -- and the genre will be known. You can say something like, "Now I know what you are thinking: Another First Person Cake Decorating game? And initially, when I was designing it, I felt the same way. But here is why I think our First Person Cake Decorator is unlike anything else in the market . . ." Your scope is aggressively large. Late presentation just before the close addresses objections like this. "Now I recognize that our scope seems too large for our small team. But team member X worked on such and such, and it had 3 times as many A.I. agents as our game. And we are open to discussing the scope with experienced developers. At the end of the day, we want to make something new and compelling for the genre and are looking for key partners like you to help us get there." 10. Leave Nothing to the Customer's Imagination
      Since I was pitching custom software, I had nothing to show because it didn't exist yet. It's one thing to pitch a car or house that is right there in front of the customer. But to pitch an idea? And they have to agree to spend the money first before they see anything tangible? This is extremely difficult!
      Now I imagine in the game space that the people you meet probably exercise their imaginations regularly. But in the business space, I can assure you that the CFOs are NOT hired for their creative imaginations. More likely, their lack of it.
      So what do we do? Do not rely on the customer's imagination to understand what you intend to do or build. Make it as concrete for them as possible. Words are cheap, so use props. One reason my software company closed many deals despite being up against larger, more experienced competitors is the lengths we would go to show the customer how their eventual software may work.
      Our competitors would hand in four-page proposals; ours were 20-30 pages. We spent dozens of hours mocking up screens and writing out feature descriptions. Sometimes we would build a demo app and throw it on a handheld. All this so they could see, touch, and taste the potential software in the board room and close the deal. Even if our software solution cost more and would take longer to complete, the customer would go with us because our presentation was more concrete. They could see success with us; whereas, they would have to imagine success with the competitor.
      In games, you can make a demo. But if that is too much, you can at least get an artist to make mock screens, get some royalty-free music that fits the theme, and then show footage from other games that inspire you. Props beat words every day of the week.
      11. Work Hard! Earn it!
      The movie Rudy is a great example of this principle. Based on a true story, Rudy wants to play football for Notre Dame. Trouble is he isn't big, fast, or particularly good at football. But he tries! Oh, how he tries! He practices more and with greater gusto than anyone else. Finally, at the end of the movie, Rudy is given the chance to play in a game. The crowd chants and the movie audience cries because it's all just so wonderful!
      Almost all of the software deals I closed were bid on by multiple competitors. Canadians love the "3 quotes" principle. When I would check in on my client waiting to hear that we won the job, it would boggle my mind to hear the decision is delayed because one of the competitors was in late with their proposal. Are you kidding me?!
      We delivered our proposals on time every time. That may have meant some late nights, but failure wasn't an option. And as previously mentioned, we always delivered more in our proposals than our competitors did. Everyone likes to reward a Rudy because we all want to believe you can overcome your weaknesses through hard work and dedication and achieve your goals. Working hard during your pitch says more about your character than anything else.
      It gives the customer the impression, "If they work hard here, they will work hard for the whole project." The reverse is also true: "If they are lazy and late here, they will be lazy and late for the whole project." Again, talent isn't everything; who you are inside and how you work is. I have personally awarded work to companies/contractors because they worked harder for it than the others, even though they weren't the best proposal I received.
      12 You Have to Ask for the Close
      You miss 100% of the shots you don't take. - Wayne Gretzky
      I'm not great at networking or cold calling. I've already shared that I'm not great at ladder climbing. But where I really shine is closing. Closing a deal is like winning a thousand super bowls all wrapped up into a single moment. With a bow. And sparklers. I could write a whole article just on closing (and there are books dedicated to it), so I've limited our time to just the most important, most missed principle: You have to ask for the close.
      I have seen great sales presentations fail because the presenter never asked for the deal. They talked and talked and said lots of wonderful things, but then just sat there at the end. What were they expecting? The customer to jump out of their seat screaming, "I'll take it!" Or maybe it's as if there is a secret that the salesperson is there to make a sale and they don't want to blow their cover by actually saying, "So, will you choose us?"
      If you don't ask for the close, you won't get the objections -- and if you don't get past the objections, you won't win. So ask for it!
      Now to some specific techniques to help you. First, be clear about asking for the close. If you want an interview, say "So do you think you can interview us?" If you want a meeting with someone, say "So can we book a meeting for Tuesday?"
      If you really struggle with what I just said, try the pre-close to boost your confidence: "So what do you think so far?" That is not a close. That is a non-threatening temperature check. The customers are just sharing their thoughts, tipping their hand to tell you what they like and any immediate objections that come to mind. After you discuss their thoughts, you still have to circle back around to booking that interview or the meeting.
      Second, when you ask for the close, the next person who speaks loses. Silence is generally uncomfortable for people, so this one requires real grit and determination. Many salespeople say something during the silence to try and help their case. They are doing the opposite. Asking for the close is a pointed question that requires the customer to make a mental evaluation and then a decision.
      If you say anything while they are doing the mental process, you will distract them and cause the conversation to veer away from the close to something else: tertiary details, objections, etc.
      I was in a meeting with a potential client when I had the unfortunate task of telling them their software wouldn't be $250k but $400k and take months longer. I explained why and then asked for the close: "This is what it costs and how long it takes to do what you want to do. It will work exactly as you want. Would you like to go ahead?"
      They were visibly mad at the ballooned cost/time. I sat in silence for what felt like hours but was probably 3-4 minutes as the VP stared at the sheets I'd given him. Finally, he said "I don't like it, I'm not happy, but ok. But this date has to be the date -- and no later!" The silence put the burden of making a decision squarely on the VP, and he decided.
      Third, expect objections. Even if you did all your inoculations correctly, there will be something you never thought of that they did. Hopefully, you got the big ones out of the way -- but I don't think I've been in a meeting where they just said, "Great presentation. Let's do it!"
      Sometimes people bring up objections for emotional reasons: They just don't want to work with you. Like the girl who won't go out with you because she has to wash her hair that night. There really is nothing you can do at that point. You've failed to build rapport or show how you can meet their needs. You won't recover these blunders at the closing stage. But for real objections, these are legitimate reasons preventing them from going with you. Get past those, and it's time for the sparklers!
      It is critical to first get all the objections in one go. This is most easily done with a simple question, "Other than X, is there anything else preventing us from working together?" I'll show you why this is important in a moment. If possible, write down every objection they give you. Most people get hung up on one or two.
      In my hundreds of meetings, I have never seen someone able to list 4+ objections to a pitch. Now work through each one of the objections in turn -- treating them seriously. Treat them like they are the end of the world if unresolved; because they are! Before moving on to the next objection, say "Does what I just shared address your concern?" If they say yes, cross that off the list.
      Once you have dealt with each of the listed objections, say something like, "Well we've addressed A, B, and C. So now do you think we can work together?"
      By gathering the list of objections first, you have achieved several things.
      First, you've shown you listened to them. Listening and understanding can overcome much of the objection.
      Second, it brings a natural path back to the close! They listed out the agenda, and you dealt with it; there is nothing left to do but close!
      Finally, you are preventing them from coming up with new objections. This is a psychological trick since you gave them every opportunity to list out their objections earlier -- now that time has passed. They look foolish if they do it again. Sort of like when you get to a certain point in a conversation, it's just too late to ask the person their name. If they raise new objections at this point, it looks like they are just stalling or delaying. Maybe that is what they are doing -- because the objections were emotional ones.
      These principles apply to writing as well! Like a website "squeeze" page to get newsletter subscribers. You have to be clear and obvious about what you want: You want a newsletter signup. Well, make it clear and easy for them to do that!
      Conclusion
      Well, there you have it: roughly 12 years of sales experience boiled down to 12 principles. Did I "close" you? Was this information helpful in improving your pitches? Use the comments to let me know! SDG You can follow the game I'm working on, Archmage Rises, by joining the newsletter and frequently updated Facebook page. You can tweet me @LordYabo
       
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