strategic planning for a games company

 Task 1: 

Executive summary: 

The executive summary is the overview of your business, it provides a view on the company’s goals, and vision for the business. As part of the overview there is a vision statement and a mission statement, the mission statement outlines the purpose and values of the business and what the business aims to achieve in the industry they are targeting, in this case It will be the games industry, the vision statement simply outlines the long-term aspirations of your business and the impact that you seek to make. 

The summary also needs to outline the key objectives, this can include for example a certain number of sales that you want to achieve. You need to provide a brief overview of the type of games that you want to publish, this includes the genre, themes etc of the games. 

Identifying you target audience is one of the most important parts of an executive summary. Here you outline the main you want to target including their age, their interests and social groups. This helps you understand the direction that you are taking your business in far more depth once you have identified this audience. You need to highlight what makes your business unique in a unique selling proposition this will show the investors what will make your business stand out in the market. 

You should show your achievements and milestones, this can be shown to investors to help fund future projects. It's also important to mention financial achievements that the business has made. If you are seeking funding from investors its necessary, that you mention how you plan this funding to be used in the executive summary. 

 

Company description: 

The description of your business provides detailed information about your business, it overviews the structure, the core offerings and the nature of the business. You should specify what kind of gaming company you are planning to be, be that indie studio, a publisher or games store, the company's founding date should also be mentioned. You should be detailing the legal structure of your company and the key shareholders and owners; the location of your company should be mentioned. 

The products you offer and how the development process went from planning to production to release. Highlight the companies' values, what are your values? Provide a team overview that goes over key personnel, any veterans you may have and what their roles may be. Mention any partnerships and collaborations with other companies in the space, the description must mention what IP you own and its importance. You must address how you comply with industry practises and it's important to mention what awards and achievements your company has achieved. 

 

Market analysis: 

The market analysis is a deep analysis of the games industry as a whole, it is used to identify your target audience, your main competitors, it can also be used to assess market trends. An overview of the industry will investigate the size, growth and emerging trends of the industry providing statistics to show this. There is deeper analysis on competitors and your target audience. 

Marketing analysis involves a swot analysis of yourself, customer needs and preferences and your barriers to entry. Regulatory challenges specific to the games industry and how these will affect your business need to be considered here. You should be identifying your distribution channels and those that are commonly used in the games industry and what channels you need to use to reach your target audience, explore emerging technologies and how your business can utilise them to get a leg up in the industry.  

 

Organization and management: 

The organization and management section of the business plan outlines the structure of your company and what responsibilities each one of these team members will have in the company. Your organization will refer to the hierarchy of the business, is there a CEO, who's below them, and the management refers to the responsibilities that these people have is their someone whose responsibility it is to run the marketing, are there team leaders in charge of small groups of staff?  

 

 

Products or services: 

The products or services section doesn't just cover the products your business will sell it also covers how these products are going to be priced. In most cases for games companies the product you will selling will be some form of live service or subscription. If you are running a live service, you mainly be concerned about how you are going to monetise this many games companies follow a seasonal model in their live service, this entails having a purchasable season every 3 months with a season pass that you rank up by playing the game this increases player retention as they are working towards the goal of completing the season pass, most games will also have a cosmetic store on top of this, these store will often have skins for you in game character, emotes etc.  having multiple avenues of monetisation is important when running a live service as keeping the service running and stocked with content is costly and you still want to turn over a profit. 

Large publishers are increasingly turning running subscriptions, Sony has the PlayStation plus subscription and Microsoft has game pass these are giant services that offer players with a massive catalogue of games at a monthly fee, these services tend to have massive losses so only massive publishers are in this space.  

You may have physical products, physical games in retail stores, you will need to price all the products that you sell to be attractive to potential customers whilst also considering if you are going to make profit on your products. 

 

 

 

 

 

Marketing and sales strategy: 

For marketing a games company, you should be heavily considering how you are going to target your audience, the best ways to do this in the gaming space is through online presence and content, you should be building a solid social media presence and producing video content to market if you are going to go down this path. Other smart ways of marketing in this space are through influencers, paying them to play the game on their platform be that through YouTube or live streaming, this is a way you can reach a huge audience very quickly, traditionally only large publishers can afford these kinds of marketing campaigns. 

Engaging with your community is a great way to build goodwill surrounding your company for minimal cost, eventually through this method of community building you may create prosumers that will advertise your brand for free through content generation, this could come in the form of fan art and general conversations around your products.  

If you have released your game, you could provide post launch support in the form of expansions and updates that could drum up more positivity surrounding your game, and this is the perfect way to retain a player base.   

 

Financial projections:  

This section covers all the financial aspects of the gaming business, covering a forecast of revenue, expenses and an expectation for your profit. Your revenue projections may include games sales, in app purchases or revenue from subscription, depending on the direction you are taking the business in. The cost of these expenses must be noted. The cost of your operations must be noted here and your profit margin. Operations covers administrative costs, marketing etc.  

Your financial projections should include EBITDA, this reflects the operations profitability before accounting for taxes, interest Etc. The cashflow statements provide a breakdown of operational cashflow, revenue collections and operation expenses, cashflows involving financing and investments should be here. Identifying the time when you think the business will break-even is key and a timeline of this period is also key. Your initial investments should be included as should the working capital you currently have to sustain the companies' daily operations. Finacial assumptions are also included in your projections such as the sales you expect to have and the costs that you expect to concede. 

Assessing factors that might affect your financial outcomes such as changes in the demands of the market and how these factors are likely to affects those outcomes is key for this section. If applicable to your company, you should be actively looking for exit strategies such as acquisitions or mergers because of this you should be considering the valuation of your company.  

 

 

 

 

 

 

 

 

Task 2:  

 

Game concept and development  

You should be coming up with an original game concept, most games are not completely original often borrowing elements from other games, this is fine as long there's a unique twist or there's enough that's different about your concept to make it unique enough for audiences for them to be able to engage with the game. You also need to consider the development timeline, when you want the game to release and what technology will present around the time of release. Some examples of games that were hurt due to their unoriginal concept    

 

 

Technology and platforms  

Considering the platform that your game will reside on is very important, if you put your game exclusively on one platform you will only need to optimise the game for that platform so you will always know the technical limitations. Examples of games that are only optimised for one platform are console exclusives such as halo for Xbox or spiderman for PlayStation. The studios that are developing these games have extensive knowledge of the technical limitations of the console that they are releasing the game for. It's also good to keep mindful of new technologies that may pop up during your games development as you may want to start optimising for a release on this future tech.   

 

Monetization strategy  

How you monetize a game can be a difficult task as you need to guarantee that the game turns a profit without implementing greedy business practice that will turn players away from your game, most gamers used agree that loot boxes were a form of greedy business practice as players had no idea what they were buying and they were essentially introducing children to gambling. More examples of good monetization have popped up recently as sentiments in the industry have changed, one of these examples being Helldivers 2  

 

 

Market trends and audience analysis  

The covers what the current trends are in the market and what the audiences' preferences are. A recent trend in the gaming space has been the battle royale, games such as PUBG and Fortnite headline this space and have for years now. Other studios tried to jump on this hype train by developing their own battle royales, during this time a ghost recon battle royale was revealed and never released, a Ubisoft battle royale had released and died in the same week, these studios failed to notice that the audience had moved away from that market trend too late and they suffered the consequences, instead they should've tried a gamble and attempt to find a new gap in the market or even bigger try to start the new market trend themselves.   

 

Competitive analysis  

This refers to the analysis of your competitors in the space. By analysing what your competitor are doing in the space is important so for example you don't release a directly competing product close to release of your competitor's similar product, we can infer that gearbox studios did not do this regarding the release of their hero shooter Battleborn, Battleborn released just a short time before overwatch a similar hero shooter from blizzard, Battleborn immediately got overshadowed by overwatch as it was an inferior product and overwatch has since become one of the most influential competitive shooters ever and even gearbox themselves seem to have forgotten that Battleborn existed.  

 

Intellectual property considerations 

You should consider what intellectual property you own and what property is in the possession of other groups. Some possessors of intellectual property historically tend to hand out their IP for very minimal fees to pretty much any development studio, games workshop gives out the IP for Warhammer to games studios very often. Some studios will keep their IP very close, for example some publishers have hold of IP they have no interest in using just because it's worth money or can be used as a selling point if the decide to sell a studio. Microsoft has used reviving dormant IP as a key driver behind some of their acquisitions in recent years, this brought better community sentiment towards their acquisition push.  

 

Community and social engagement 

Having a thriving social community can help gamers feel closer to the games they play and make them more personal to them, this also means that the games company themselves must foster this community with their own social engagement. Community engagement is one of the most important parts of games development and supporting a game post launch. This is how the developers can respond to and read feedback from the community. Studios will use social media to engage back with the community by informing them that they are listening to specific pieces of feedback, theyll often post patch notes and even teasers for upcoming updates that the community will start talking about.  

 

 

User Aquisition and retention  

User acquisition and retention mainly relates to live service games as player retention is one of the key goals of a live service. You acquire users by marketing your product well, the key problem to solve here is how you retain these users for a long time, a development studio will do this by delivering constant content updates and patches to the player base, but they must listen to the players wants and desires as delivering patches that the community has not requested will cause people to drop off. An example of a game having excellent player retention and ending up with poor retention is destiny 2, initially the game had consistent large content updates in line with what the community wanted overtime the community was still being listened to however the developer's response to these updates slowed down and this caused the fall off players.  

 

Game lifecycle and updates  

A games company can handle a games lifecycle in many ways. In most cases a game will release and that will be it, on some occasions these games will receive a few patches for bugs, but this is the extent of the game's lifecycle. Then you have some single player games that have support from the developers for a large period, cyberpunk 2077 is a great example of this. The game initially launched in an unfinished state and over the course of multiple years the developers at CD projekt endeavoured to fix the game through a series of large technical patches. After they had completed their wave of technical updates, they then focused on content updates consisting of long requested community features, these updates added apartments, new weapons, new cars etc. to the game. Recently they released the only large paid expansion for the game, this marked the end of developer support for the game, cyberpunk proved that games could have a long road to recovery and gamers will be patient and come back when the game is fixed.