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Social Games Could Soon Be Pulling In $5 Billion a Year

| 11 Apr 2011 19:20
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If you think social games are big business now, wait until their market grows to five times the size it is today.

According to analysts at research firm Park Associates, the international market for games played on social networks, like FarmVille or CityVille, hit the $1 billion mark last year, and is expected to grow by vast amounts in the coming years. By 2015, the social games industry will have grown to five times its current size, and will be pulling in an industry-wide total of $5 billion a year in revenue.

Part of this rampant growth is due to the numbers of people who play social games. It is estimated that over 250 million people play social games, making them prime targets for advertising and marketing dollars. Promotions and ad dollars aside, social games are very lucrative sources of income in and of themselves. With the cost to develop social games so low compared to developing AAA games, most of the money made by microtransactions is pure profit.

The biggest factor in the increasing profitability of the social games market, however, is the industry's ready access to behavioral data, allowing the companies to cater their games towards the most profitable groups. "Zynga's huge market share is the best proof of the competitive advantage made possible by properly leveraging consumer data," said the research firm of social games giant Zynga. "The abilities to measure the efficacy of different gameplay mechanisms, to tweak game design in near-real time, and to test new models are advantages that traditional gaming companies will never have."

Source: GamesIndustry.biz

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