Support Groundswell
Surviving transition years, riding out market lows, building a groundswell of support for your product or brand… All problems whose solution, primarily, lies simply within controlling costs, establishing fresh distribution channels and revenue streams, learning to work with new sales partners and finding original ways to speak to increasingly diverse audiences.
So why limit yourself?
As TV-star-cum-singer-turned-living-parody David Hasselhoff discovered after going platinum in Germany, while his Magic Collection CD sits currently ranked #396,645 on Amazon.com, there's a viable market just waiting to be tapped overseas. And, of course, a massive talent pool that can provide you the edge necessary to come out ahead as gaming transitions into a medium on par with film and literature in the popular mindset.
Don't believe me? Check the facts.
Grand Theft Auto was developed in Scotland. Two of the most talked about upcoming first-person shooters – Vivendi's TimeShift and THQ's S.T.A.L.K.E.R.: Shadow of Chernobyl – are coming from Russia and Eastern Europe. Midway's been touting Rise & Fall's overseas performance as one of the high points of its most recent financial quarter. Microsoft's $375 million purchase of UK-based Rare in 2002 was joined earlier this year by its acquisition of fellow British firm Lionhead. And RedOctane's Indian division is already garnering praise for its work on the first title based on a Bollywood film.
Mind you, merely importing/exporting ideas, products and resources between continents is no guarantee of success. As we at Embassy Multimedia Consultants (www.embassymulti.com) have learned, every problem demands a unique, custom-tailored solution. Nor would our staff presume to tell you how to run your business – just present a few new ways of looking at it.
Retail Divides
To preface, I'm neither an accountant, analyst, educator, programming whiz nor design guru. What's more, success in this field comes as a result of hard work and collaboration between talented individuals on both sides of the publishing and retail divides. Question everything, and take all advice with a grain of salt: Only you truly know what strategies make most sense for your organization.
But as a former product acquisitions executive and CEO, I am someone who's made a living identifying market voids, spotting rising talent and shopping product to/sourcing it from the four corners of the world. And an everyday guy who took a game – Heavyweight Thunder – produced out of a proverbial garage, and saw it marketed via online/retail outlets in more than a dozen individual territories. The net result: Over 50,000 pieces sold, 95% of revenues derived from markets outside the U.S., and a product that achieved profitability before it even shipped.
Based solely on real-world experience and hands-on feedback, the following are a few thoughts any savvy executive or marketer looking at globalizing their operations would do well to consider:
1. Focus on familiar concepts, brands
Every territory has its own social norms, mores, and – most importantly – pop culture framework.
Developers: Why build a game that speaks to a single audience when you can instead create a concept that's marketable across the world in its entirety? Publishers: What's the point of hamstringing sales potential, adding layers of complexity and packaging titles in such a way that they're only suitable for sale in one nation instead of 50?
Across countries, political/geographic boundaries and cultures, we all understand certain topics. Music, animals, sports, food… Keep game premises rooted in real-world frames of reference whenever possible. Even when speaking to various sub-cultures or niche markets (i.e. import tuning fans or turn-based wargame enthusiasts) it's possible to tweak titles so they're more instantly comprehensible.
Concentrate on perfecting your elevator pitch. If someone stops you at work on the ride up to the 10th floor and asks you to explain your game in 20 seconds or less, can you? If the answer is no, perhaps you need to reconsider.
As the casual market has so effectively proven, all demographics – women, seniors, even those who can't tell a pachyderm from a PlayStation 3 – are potential game buyers. It's merely a question of whether it's possible for them to interpret your sales pitch and how they do so. (For example, try showing a 50 year-old mother of two BloodRayne and Bejeweled and see which one she chooses.)
Likewise, some branding choices will make sense in certain parts of the world, while they're likely to be met with blank stares in others. Whatever happens, before signing on the dotted line, do your homework: Talk to overseas partners, research various territories' temperaments online and, where applicable, conduct focus group testing. Otherwise, you could get stuck with a New Coke – or, worse, Pocari Sweat Extreme Powerlifting.
2. Don't make when you can buy
The temptation's always there when you're a publicly-traded company and millions of dollars and mountains of shareholder goodwill are at stake to develop, make and market your own annual hit-driven franchises and original IP.
Fine – that's your prerogative. But rising costs of next-generation PC and console development (anyone got a spare $5-15 million?), shifting distribution channels and a constantly changing marketplace make any investment of this size, even sequels, a risky proposition. If you're going to go all out, before green-lighting internal development or contracting with a domestically-located production house, first see if there's a similarly-themed product floating around overseas.
Dozens of titles debut on each continent every week. Why build from scratch when you can simply buy one (or built-in content and software/graphics engines) and adapt to suit your needs? Often, differences in cost-of-living and overhead expenses realized by shopping abroad can skew in your favor. Better yet, you'll frequently pick up a product on which work has already commenced, helping mitigate some of the uncertainty which can plague any new development. Often, such games are from proven producers who've built up a small domestic following as well. With luck, you could stumble upon not only the right developer to produce a title from a pure cost standpoint, but one who's experienced enough to pull the project off successfully.
The greatest find of all, though? When you or an associate stumble upon a finished game that can simply be repackaged and turned around in a matter of weeks. Assuming you acquire rights to re-brand the program, who's to say you can't ultimately create a license that your company owns all copyright and title to anyway? And should ties ever needed to be severed with the original game's developer, well… You can simply hire a new studio and continue producing products under the same flagship banner.
3. Build games with localization in mind
Holy crap – you haven't lived until you've until you've had to take a title from its native English and translate into 27 different languages, each of which uses wholly different graphic characters.
Marketing a game in dozens of territories is mandatory at this point: Why sell to one target market when you can reap the rewards of servicing 35? And no one – be they local consumers, reviewers or sales/distribution partners – wants to see a quick hack job done on a game just to bring it to market. Or, for that matter, find themselves offended by an offhand remark that, while innocent enough in German, means "Your mother smells like wet dolphin droppings" in Portuguese.
So this next point cannot be stressed enough: Take the time up-front to ensure that your technology is capable of being adapted to suit various markets. It'll save associates countless headaches down the road, lessen the trauma of having to redo speech systems and movie sequences and provide time during which you can double-check for potential points of cultural contention. Oh, and just a suggestion: Consider actually having a speaker of each native tongue have a quick peek at the title before plopping it out at retail.
4. Invest in each territory separately
News flash: The international marketplace is important – massively so.
It's not uncommon to see as much as half a developer or publisher's sales come from foreign sectors. UbiSoft alone claims 51% of total revenue in the first quarter of fiscal year 2006/2007 was derived from outside North America. I'm guessing mobile game powerhouse Gameloft didn't just simultaneously launch Lumines Mobile recently in 75 different countries simply for comedy value either.
That said, here's a thought: Take the time to devote funds to and plan and execute a proper individualized marketing, PR and distribution campaign in each of, if not solely your biggest, overseas markets. Tailor each country's particular brand of messaging separately as well. It's not that you can't do this, or haven't well in the past. It's just that given the typical daily executive routine, most don't have the time to see what's going on in the world right outside their office, let alone thousands of miles away.
The solution: Make the world, not just Belgium, Canada or Finland, let alone New Jersey, a priority. Assign staff to tackle to this problem. Keep tabs on how ventures are progressing and source feedback from journalists, brand leads and retailers. Learn to interpret what makes each territory different, how to best communicate with its populace and whether there's a particular market niche you can fill.
Seek synergy wherever possible; there's no sense being the puzzle game champion in Russia and real-time strategy king in Korea. But, of course, a one-size-fits-all approach isn't always suitable. Learn to maximize efficiency, while maintaining enough flexibility – and self-awareness – to step back and swap strategies on a dime when things aren't working.
The world is prone to changing in the blink of an eye. To keep up with it, you have to be willing to expend the time and money necessary to be capable of doing so too.
5. Treat subsidiaries, partners with mutual respect
Between the Internet's global reach, gamers' vocal/close-knit nature and the many talented associates continuously working in every conceivable time zone to promote your products, the whole world conspires to ensure your success. Shame on you, I say, if you're not trying harder to take advantage of these tools.
Unresponsive sales reps, territorial disputes, a general conception amongst company internals that if it doesn't fall within a set purview, it's not your problem… These are but a few of the problems that plague any global undertaking. If your company's international subsidiaries can't even communicate with one another – say, to get Italy the screenshots it needs from America to put together boxes and ship on time – what's the point in trying? Futility leads to aggravation, aggravation apathy, and apathy eventual complacency and burnout.
Free exchange of help and information is crucial when operating on a global scale. Appoint key, motivated decision-makers to oversee such operations and interface with international relations. If the undertaking doesn't make sense from a day-to-day cost standpoint, start thinking about the benefits to be recognized from implementing various economies of scale. At worst, it always pays to help build buzz by facilitating an extra foreign interview or ad placement, and of, course, generate associated brand goodwill. At best, you'll be able to spot developing opportunities and burgeoning trends before they explode onto the collective consciousness. All three of you in Cleveland who actually saw Crazy Frog coming, please raise your hand.
6. Manage expectations
Your bullfighting simulator did 150,000 units in Spain? Fantastic! Now the bad news: It's more likely to move 15, period, in Manhattan.
While exporting games can certainly be a lucrative venture, and you should always be chasing new opportunities, part of being a savvy businessman means knowing where practicality begins and hubris ends. Too many times I've seen developers come in asking for promises, commitments, advances and promotional support that's way out of line with the market realities governing the product they're trying to promote.
Keeping tabs on an emerging market and making sure you don't get screwed is one thing. Grossly overestimating your product's worth a whole other kettle of fish entirely. It should go without saying: A product is only worth as much as people are willing to pay for it. And you need to do the homework necessary to know when asking a partner to cough up $2 million for TV advertising for a curling simulation is wishful thinking, to put it mildly.
Success in one territory doesn't automatically guarantee victory in another arena either. I don't care if you've moved half a million units in Scandinavia. If you can't communicate effectively with local retailers, produce packaging that speaks to the right audience or conduct a proper PR campaign in overseas markets, you can forget about cashing out. Simply securing distribution isn't enough either – don't put product on shelves if you can't back it up. Taking heavy-handed tactics with potential partners, assuming in your mind that you can always go it alone, is an unwise strategy as well.
Never sell yourself short. But also never do as other companies I've seen and, sadly, keep your product from ever reaching eager buyers' hands by succumbing to arrogance or greed.
7. Take foreign correspondents' advice to heart
A long time ago, a little retail chain – you might know them as Wal-Mart – asked for a deer hunting game. That innocent request, scoffed at by many, soon went on to become a multimillion-dollar sensation that ushered in an entire era of budget-priced, casual diversions.
The lesson to be learned: Keep your ear to the street. If an associate overseas tells you an opportunity is being missed to market to a particular demographic, invest the time to perform a cursory investigation at the very least. Likewise, should they inform you a particular form of messaging – ads, boxes, sell sheets, even general branding – is confusing, indecipherable or in ill-taste, also look into it. It's also worth putting in the occasional query or research necessary to understand how you're being perceived by the public in each particular country. You may be a hometown hero, but reviled in the eyes of the rest of the world.
Nobody can read the pulse of a foreign market like those who constitute it. A wise leader learns to trust and respect his advisors' council.
8. When searching, cast a wide net
Don't be fooled by stereotypes; people are capable of amazing feats of talent and ingenuity the world over. Cars made in Korea were once the laughingstock of the automotive industry – I now proudly drive a Hyundai.
Eastern Europe, South America, China, India… Constantly be looking to developing territories for the hottest new opportunities in gaming. Certain areas of the world may not sport sophisticated development communities today, but they will eventually, and only a fool would miss the chance to be at the forefront of these movements.
When shopping for product or seeking foreign partners, it pays to be an agnostic: Good people are good people, and cash spends just as well or poorly in any given market. (It all depends how you utilize your resources.)
Hunt far and wide for anything and everything – you never know when you'll stumble across a lucky or once-in-a-lifetime find.
9. Choose overseas partners carefully
Be careful who you work with – not all companies are as scrupulous or committed to the high ethical standards you pride yourself upon. Take it from personal experience. The way things read on paper isn't always how they turn out, and suing someone halfway across the globe isn't always as feasible as you might think.
Make a point of researching any potential partner in-depth before cutting a deal, and try to secure as much in hard equity as possible up-front. The more stable and trustworthy your choice of associates, the less you stand to lose should anything go awry. Go with your gut when in doubt; if a particular deal or distributor sounds too good to be true, it probably is. That's not to say you shouldn't take chances along the way: Some of the best deals I've negotiated have been made via sudden, surprise acquaintances.
Always take a good look at any given field and those operating within it before jumping in, however. You need to understand where partners sit legally and financially, how they're perceived by the customer, and what influence they really command in the marketplace before signing on the dotted line.
10. Start exploring the possibilities today
Given the above information, there's no reason you can't begin making immediate overtures towards globalization.
Even if all you do is build a website, start researching overseas distributors online or run a cursory scan of foreign game magazines looking for potential product, it's a step in the right direction. (Checking out some of the many upcoming international trade events such as the Tokyo Game Show, Germany's Games Convention and France's Game Connection is advised too.)
After all, the biggest reason most companies don't succeed outside of their immediate borders? They, like many of us, simply forget that while we shortsightedly slave over PC desktops, Xbox 360 development kits and "market-revolutionizing" sales presentations, there's a whole entire world going on around us out there.
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