When Games Explode; Part III of III: The Tipping Point

 
 
This is the last of a terrific 3 part series of articles by Rob Bartel.  Rob Bartel is a veteran designer and producer of video games with Electronic Arts’ BioWare studio.   Rob is uniquely qualified to write this series as he recently expanded into board game design with Two by Two, a light family game published by Valley Games. A passionate advocate for the board game industry, Rob helped found two national initiatives - the Game Artisans of Canada and the Canadian Heritage Collection. His newest endeavor is the Famous Games Company, an innovative provider of promotional card games for the sports marketing industry.

Parts I and II of our When Games Explode series examined how digital games have followed a remarkably similar historical trajectory as tangible board and card games. We also explored how video games took the lead in that relationship, reaching a cultural tipping point in 2007 that saw them embraced by the mainstream in the form of casual games on iPhones, Facebook, and the Wii. Part III concludes the series with a look at how we’re currently building toward that tipping point in the tangible games industry, evidence that suggests we’ll enter that tipping point in the fall of 2011, and what we can expect the landscape to look like on the other side. It’s a good theory but where are the facts? Consider the following:

Growth In Hard Times

The tipping point caught the traditional video game companies unaware. Coupled with the 2007 credit crunch and subsequent recession, traditional video games saw multiple years of steep double-digit sales declines in their traditional channels while industry researchers struggled to quantify the value of the new iPhone and Facebook platforms. Today, the share prices of most American business sectors have recovered but not those of the video game industry. Electronic Arts shares, which had hovered around the $50-$60 mark since late 2003, suddenly dove to under $20 in 2008 where they’ve remained until very recently. The other major publishers fared similarly. The picture is decidedly different in the physical games industry, however. In 2007, Inc.com included independent board game publishers Rio Grande (86.4% growth) and Fantasy Flight (125.3% growth) among America’s fastest growing companies. Online retailer Boardgames.com (124.5% growth) made the list in 2008 and Fantasy Flight returned in 2009 with 174.1% growth. These are exceptional cases but the trend holds true at the broader level as well. CNNMoney reported that, as an entire category, board and card games saw a 23.5% growth in sales in 2008, comparable to the remarkable 23.4% return offered by gold bullion in 2009. In 2008, the US dollar return on gold bullion had only been 5.6%.

Evidence of the market shift can also be found in purchase intent surveys. A 2009 Harris purchase

intent poll focusing on adult purchasers within the broader toy sector found that 30% of respondents expressed intent to purchase board games, compared to 36% expressing intent to purchase video games. Interestingly, women in that survey were more likely to purchase board games (33%) than video games (32%). When Harris ran the same poll again in 2010, board games and video games were neck and neck at 32% purchase intent. Women were once again more likely to purchase board games, this time at 33% compared to only 27% for video games. While the Harris surveys are specific to the toy industry, a broader 2010 Christmas purchase intent survey run by the Australian Researchers Association placed purchase intent for traditional board games there at 45% and video games at 33%. To provide a sense of scale, 33% were intending to purchase an iPod or MP3 player and only 20% were planning to purchase that year’s hot new technology product: Apple’s iPad tablet.

 PREDICTION #1: The 2011 Harris poll will confirm that tangible games have overtaken video games for the average adult North American consumer.

A New Kind of Game

So, if we’ve determined that people are buying more board and card games, doesn’t that simply mean that they’re buying more games in the existing childhood and teenage style? Yes and no. The dominant publisher of traditional children’s games, Hasbro, reported a 12% decrease in game sales this summer, a crisis they’re attempting to address via layoffs, restructuring, and the creation of a “Center of Excellence” in Rhode Island. Teen-oriented publisher Fantasy Flight has built much of its rapid ascent on the back of science fiction-, fantasy-, and horror-based settings and sells through an extensive network of independent comic book stores. Due to the high price points, lengthy playing times, and significant complexity of their games, however, they have been struggling to break into the wider mass market. Far from American shores, however, a new approach to board and card game design has emerged out of Germany where they have gained mainstream acceptance. These so-called “Euro Games” generally have simple rules, playing times of 90 minutes or less, indirect player interaction and attractive physical components. They emphasize strategy but play down luck and conflict, prefer whimsical or historical themes to ones based in science fiction, fantasy, horror, or war, and keep all the players in the game until it ends. As a result, they appeal to a wide range of ages and their audience includes casual gamers, who play with family and friends, as well as more serious hobby gamers.

The best-known example of this style is a 1995 board game called Settlers of Catan. It has sold over 15 million copies worldwide and is now the fastest-growing board game in the United States. It sold 100,000 copies here in 2007, doubled to 200,000 a year in 2008, shipped the millionth copy in 2010, and is expected to sell a million copies here a year, beginning in 2013. A new wave of American publishers has emerged, with some of them, such as the fast-growing Rio Grande, getting their start as importers and translators of these German games. Even more important, the design philosophy they represent is also taking root: Ticket to Ride, a popular Euro-style game both invented and published in the US in 2004, went on to win that year’s coveted Spiel des Jahres (“Game of the Year”) award in Germany. American publishers are publishing new designs from European designers and European publishers are doing the same for a talented new generation of designers from North America. As of yet, none of these domestic or foreign publishers have been acquired by Hasbro.

PREDICTION #2: Within North America, annual sales of Settlers of Catan will soon surpass that of Monopoly. By virtue of their strong international roots, multi-generational appeal, and compelling design philosophy, Euro-style games will ultimately become the dominant style of large-box game on the market.

Board Games in Popular Culture

Like the Nintendo Wii that sparked the beginnings of the digital tipping point in 2007, tangible games are beginning to figure more and more prominently in schools, libraries, book stores, clinical practices, airports, cruise ships, and the night life and dating scenes. An ever-growing list of famous people are playing these games off-set, on tour, between sporting events, and at home with their families. Some, like actresses Darryl Hannah and Hilary Shepard Turner, aren’t just consumers of games but are actively designing and promoting their own creations. Meanwhile, the World Series of Poker has more entrants than the average US Open, PGA Tour, or FIFA World Cup game has spectators and pays its winners more than the Indy 500.

In late 2009, the Wall Street Journal ran an article describing how Settlers of Catan has gone viral in Silicon Valley and is replacing golf as the preferred social lubricant for big business deals in the tech sector. Popular tech culture magazine, Wired, frequently runs board games reviews (including a very flattering review of one of my own designs) on their blog. Their UK March 2010 issue included a passionately written and fascinatingly in-depth 3-page article on the history, strategy, and psychology of a simple card game called Werewolf. Where does the article begin? With a gathering of prominent tech executives, playing the game in a Silicon Valley boardroom. As the article goes on to say:

Werewolf… has infected almost every significant tech event around the world, from the informal Foo Camp conferences run by O’Reilly [Media] to the music, film and interactive-media crossover of South By Southwest (SXSW). During lunch at San Francisco’s giant Game Developers Conference, or in the bars after closing at ETech, games of Werewolf break out spontaneously.

Indeed, Silicon Valley is the new arbiter of cool in this modern age, and home to a new generation of compelling lifestyle brands. Despite (or perhaps even because of) the apparent contradiction, it’s clear that the high-tech world is very much enamored with the low-tech and retro world of board and card games.

PREDICTION #3: The tipping point isn’t simply coming – it has already begun. Mainstream engagement with tangible games is already spreading outwards from prominent trend setters within the tech and entertainment industries. By 2015, we’ll be able to look back at this year as the beginning of a fundamental shift in the tangible games industry here in North America.

So What Does the Tipping Point Look Like?

If the tipping point for tangible games mirrors that of the digital game industry, we can expect the leading tangible games to exhibit the following traits: 

1. Games will be Casual: Attracting casual audiences is critical to achieving mainstream success. Wii, Facebook, and iPhone games succeeded by reaching large audiences that didn’t self-identify as “gamers”.
2. Games will be Simple and Intuitive: Where the teenage era placed an emphasis on complexity, detail, and minutiae, the tipping point is all about the ability to pick up and play with minimal introduction.
3. Games will be Compelling: In the post-tipping point video game sector, the intrinsic quality of the play experience continues to trump the power of established brands.
4. Games will be Short: According to Hasbro, the longest recorded game of Monopoly lasted 70 days. Role-Playing Game campaigns often run for months or years. In the video game world, we prided ourselves on how it took players over 200 hours of continuous play to finish our magnum opus, Baldur’s Gate. Then the tipping point came. Expect the dominant games to play in 30 minutes or less.
5. Games will be Inexpensive: Traditional video games continue to cost between $40 and $60 at retail. Board games fall into a similar range as traditional video games although mass market titles can often achieve $20 price points due to their greater economies of scale. Card games are cheaper to manufacture and are typically available in the $8 to $20 range. UNO, the world’s top-selling card game, is able to achieve a $6.99 price point. iPhone games, on the other hand, typically cost $0.99 to $2.99 with games for the iPad costing $4.99 to $6.99.
6. Games will be Retro: While the teenage era of video games focused on processor speeds, 3D graphics engines, and visual fidelity, the games that sparked the tipping point were decidedly old-school, retro, and low-tech with their simple 2-dimensional sprites and limited range of special effects. From a technology standpoint, there’s very little about these games that couldn’t have been implemented a full quarter-century earlier.
7. Games will be Portable: The Wii was the smallest of its generation of consoles and the carrying case proved to be a popular accessory. Facebook games succeeded because they lived in the “cloud” and could be accessed from any computer so long as you logged into your Facebook account. The iPhone replaced previous portable gaming devices such as the Nintendo DS and Playstation Portable because, as a cell phone, it was a device you could justify always having with you.
8. Games will Originate from Outside the Established Industry: In the teenage era, Nintendo was the underdog. Apple had no interest in games and, with the iPhone, didn’t set out to build a gaming device. Facebook was a social networking website. By its very nature, the tipping point is a disruptive force that turns an industry’s preconceived notions of itself on its head and introduces competition from well outside the established industry.

Comments

[keith gardner]

Thank you so much Rob for your insight and a big thank you to Richard for bringing it to us! I have been waiting for Part III, and I'm very pleased to see where we are all headed.

[David Topham]

Thank you for sharing your great insights. I would love to hear if backyard games/tailgating games are expected to follow a similar trend and if there is a direct correlation or if your research covers this area. Really enjoyed the three part series.

[Rob Bartel]

@David - I'm glad you've enjoyed the series and I hope you've found it useful. The important thing to remember about the tipping point is that it's manifesting as a sudden increase in the diversity of games available.

On the digital side, casual games definitely emerged as the new dominant form but Hi-Def video games certainly haven't gone away and there are plenty of unconventional and decidedly non-casual games finding their audience on mobile phones, tablets, etc.

If one can avoid subdividing games into separate categories of digital vs tangible, game vs toy, etc., I think it would be very easy to make the argument that we're in the midst of a sudden boom in the notion of "play" - whether it's the rising prominence of sports, innovations in playground equipment, the clear tipping point that's occurred in digital games, the tipping point we're now entering with tangible games... Whatever way you slice it, a larger and more diverse population is spending a lot more time engaged in the act of play.

With regards to backyard & tailgating games, you're probably far more knowledgeable about it than I am. For answers, I would encourage you to look at trends in the use of private and public outdoor spaces - cities are growing and the countryside is shrinking. Within the cities, are more families moving into highrises and apartment buildings where they don't have a private yard or safe driveway in which to play your games? Are these buildings implementing green spaces where families can feel comfortable engaging in your games? What about public parks and camping trips? Are your games portable? Are they easy to set up and take down? Are the components easy to use? How much space does it take to play? Does it support intergenerational play? Does it require paved or grassy surfaces or can it be played on either?

Ultimately, the tipping point represents an opportunity for all of us in the play industry to really rethink, realign, and reinvigorate what we bring to the table, the pocket, the park, the playground, and beyond.

[David Topham]

@Rob - Thank you for responding to my comments. Two things I love about this industry are creativity and a sense of community - people reaching out to help others succeed. I have licenced one game and I am proto-typing two others. All of them are backyard/tailgating games. The category has had a surge with retro games as you discribe (Washers, Ladder Golf and Cornhole). I have not determined if that was because of a lack of alternatives or a simple bridging of multi-generational play as you describe. I am trying to provide innovation. We'll see how it is received. I guess if it's fun and affordable I stand a chance.

[Rob Bartel]

For those just joining us, previous installments of the When Games Explode series can be found here:

Part I - http://www.globaltoynews.com/2011/09/when-games-explode-part-i-of-iii-a-brief-history-of-digital-games.html

Part II - http://www.globaltoynews.com/2011/09/when-games-explode-part-ii-of-iii-a-brief-history-of-tangible-games.html

[Pat Keogh]

Research indicates that play has a biological place in the future of public health.
Stuart brown play psychologist encourages us to engage with body object social and fantasy to transform play in the future.
The trouble of attuning the hand to the brain and the frustration of the vice versa of the design problem, is for the designer to provide relevant solutions by re stimulating the childhood adolescent and mature emotional moments of happiness
• The OBJECTIVE in any social experiment is to plant a seed, observe record and interrupt its growth in parallel experiments; patterns and neutering tools can then be designed and redeveloped, in the process.one area of interest

Fact: there are 900 million batteries used each year in the UK alone and many are in toys.

Fact: Only 2% of batteries are currently recycled - the rest end up in landfill sites and are poisoning our planet!

Fact: Kids love electronic toys!
The problem: How do we give children what they desire but without poisoning our planet?

One solution: -batteryless electronic toys! Here’s a Scoop! The face of the eco-tronic toy world is about to change forever! If we are willing to take a chance on the dice.

Rob loved your articles

and thanks to Richard for the blog

[Mary Couzin]

Rob, this is the most insightful and interesting piece/series I have ever seen on games. Thank you!

[Rob Bartel]

Thanks, Mary. That's some very high praise coming from someone such as yourself. It's certainly been a pleasure to write, share, and discuss this series and I'm glad you've enjoyed reading it. Any predictions of your own on where you think games are headed?

[Jack Geisler]

2 thumbs up. :O)

[Colleen McCarthy-Evams]

Wow, really enjoyed that! And so appreciate all the research. Inspiring and encouraging for those of us in the trenches! Thank you!

[Colleen McCarthy-Evans]

please excuse typo in my name in previous comment...time for new glasses...;-)

[Rob Bartel]

Thanks Colleen. I'm in the trenches with you but it's always good to hop into the hot air balloon for a little while and get the view from above. =o) Congratulations on your continued success as a designer and all the best as we transition into the tipping point.

[Chris James]

Thanks, Rob, for this very insightful series of articles. Not only have they been very well researched and enjoyable to read, but they most certainly capture the vision and the hopes that I have for the board game industry.

I whole-heartedly agree that light and relatively quick games for a casual audience are the future of this industry and have the potential to attract newcomers like never before.

[Rob Bartel]

I agree, Chris. That said, I'd also urge fans of heavier and more in-depth games not to despair - there's plenty of room for both on the far side of the tipping point. But the light, quick, easy-fun games are the ones that I expect will be grabbing the bulk of the new market share.

[Alan Biggs]

The more people play socially fulfilling games the more they will want to play. The simpler games become the gateway to a richer play experience. Which is good news for everyone.

[Mary Jo Reutter]

Rob, a very interesting and well written series. Thank you for bringing it to us. I appreciate the research. I thought your analysis of board games being merged into the world of toys in the 60's and 70's was particularly interesting. I hadn't considered how the merge had cast most games into a "child's" realm. I suppose that wasn't so bad before the age compression that we're now faced with in toys – but with that age compression it becomes very limiting. Games that used to be played by a 10-13 year old, now are viewed as best for a 5-7 year old. Kids don't want to be viewed as "babies" and adults wouldn't consider a game they thought was only for little kids. I am trilled that the day of the "casual" game seems to finally be here, and that games can break out once again to be enjoyed by people of all ages, whether it's shooting birds from a sling shot, matching up rows of red circle tiles, moving a meeple to harvest grain, or even slapping a moose. Thank you for the fascinating series, it really filled in some blanks for me. I hope we'll see more from you!

[Rob Bartel]

Thanks for the kind words, Mary. I've accepted Richard's invitation to become a regular guest blogger on the site and am already pondering a couple of topics I'd like to tackle next.

As for age compression, it's definitely been a huge problem for toys and games of both a physical and digital nature. Thankfully, it's proving to be a solvable one.

If you think about it, we've fallen through the proverbial looking glass into a topsy-turvy version of the 1700s. Back then, age compression wasn't an issue as children where largely considered to be "little adults", there to be seen and not heard. In the Victorian Era, we saw the real emergence of childhood as a distinct social construct.

Adolescence, which I've been referring to as the teenage years, is largely considered to be a social construct that emerged in the 20th Century. On a broad sociological level, then, you could fairly easily argue that the tipping point in toys and games is really about the emergence of a new, millennial social construct where adults are now open to considering themselves as "big kids" - while it's the complete opposite of what occurred in the 1700s, it's still marked by that interesting lack or minimization of age compression.

Thanks for reading the blog series!

[Lewis Pulsipher]

Rob,

That's a very interesting and different take on the history of games and where we're going. Having played them for more than 50 years and designed them for decades, I'd love to think that tabletop games (I much prefer that term to "tangible games") will explode, but I see nothing to indicate that this will happen. There are fundamental reasons why video games have a broader appeal.

Mike Gray (Hasbro's game acquisition person, formerly their chief designer) says in a solemn and perhaps long-suffering voice: the big problem with tabletop games is that someone has to read the rules. Hasbro needs to sell 300K-1 million of a game, and many of their buyers do not want to read rules. One reason why Hasbro puts out so many versions of Monopoly, Risk, and Axis & Allies, is that people buying these games already know most of the rules.

A major reason why video games are so much more popular than tabletop, is that most of them can be played adequately, at least, without reading any rules. Pop it in and go.

Richard Borg (Liar's Dice, Memoir '44,. etc.) said a game for Hasbro can't have more than two pages of rules. "Tl;dr" is an acronym I've seen in the past few years that characterizes the problem. (It means "too long; didn't read" for those not familiar.) The broader your market as a designer, the more you must cope with these limitations and attitudes.

People who buy Monopoly--usually parents or someone giving a gift--buy it because it's so well-known, not because it's a good game (it isn't). They also buy it because *everyone already knows how to play* (or thinks they do).

Even amongst Euro-game players, most do not want to read the rules. There are typically a few people in any large group who actually read the rules and then teach the rest.

I advocate including in each game DVDs with video of someone teaching how to play the game, but few manufacturers are willing to do this. (*Many* more people know how to load a DVD and play it, than know how to download or stream something from the Internet.) Mike Gray told me that the simple idea of an 800 phone number that people can call to learn how to play a game has been patented! So Hasbro does not use it.

The digital tipping point you refer to may have marked a downward trend for traditionally sold video games, yet at the same time digitally distributed games have prospered, as have casual video games. Social networking games have reached more than 200 million players, and while free to play, have powered Zynga into one of the most highly-valued video game companies. Mobile games have exploded. Digital games as a whole are continuing an upward trend despite the recession.

The recent prosperity of tabletop games can be explained in terms of the recession. During recessions traditionally, inexpensive forms of entertainment prosper compared with expensive forms. Traditionally marketed video games are $50-60 for increasingly short play, perhaps 5-20 hours now. A good boardgame may cost as much but will be played for many more hours (and by multiple people at the same time). The boardgame is much more bang for the buck, which is more important during a recession than at times of economic prosperity.

Tabletop games are now faced with competition from all the free-to-play casual and social network games, and from very inexpensive mobile games for iPad and Android, among others. When the choice was $60 for a video game or $50 for a Euro-style game, it was easier to buy the latter. When the question is zero dollars for free-to-play games, or $50 for tabletop, the "bang for the buck" equation points toward the video.

Many video games are mass-market games. Euro-style tabletop games have been around for a couple decades. They are sometimes characterized as "family games on steroids" or "family games for adults," but by and large they are not mass-market games. I cannot see what will suddenly change to make these games far more popular.

Yet another reason why video games have the lion's share of the market is that they can be played by one person. You need several people to play a tabletop game. Furthermore, many video games are really interactive puzzles, not games (there is no intelligent opposition). Puzzles appear to be more popular than games, and have been for a very long time. Perhaps that's because people don't want to compete with one another. Though there are tabletop games that do not involve beating someone (RPGs, most obviously), the usual assumption is that in a tabletop game there is one winner and one or more losers. You can't lose a video game.

[Rob Bartel]

Hi Lewis,

Some excellent points and I definitely agree that the rulebook remains the biggest hurdle to further growth in the board game sector. I hope to address that point further in an upcoming blog post.

As much as you and I both love playing Euro-style games, I think we both agree that they're only a part of the puzzle. While they're experiencing significant growth, and Settlers of Catan is posing a very real challenge to Monopoly, I still consider them unlikely to become the dominant board game format on the far side of the tipping point. What they do offer, however, is a powerful new approach to designing games for an age-decompressed audience.

I share your assessment that the suffering economy has certainly heightened awareness of tabletop games and helped introduce them to new audiences. However, I'd argue vehemently against the notion that we're in some sort of boardgame bubble that will suddenly burst once the economy improves. If they're enjoying themselves and deriving real social value from the face-to-face interactions these games provide, that's a pattern of behavior that they'll indulge in even further as their stability and discretionary spending increases.

As for the argument that digital games are cannibalizing the market for tabletop games, that's a very intuitive observation to make and one commonly echoed as a result. Just because it's intuitive, however, doesn't actually make it true...

If you argument were correct, the current tipping point boom we're seeing in digital games would be completely and utterly decimating the tabletop games industry. With the explosive growth of Settlers of Catan I referred to in my article, with the sudden flurry we're seeing of new indie publishers entering the industry, and with the Harris purchase intent surveys I've been referring to, that's clearly not the case. And that's *despite* the fact that this new explosion of digital games are undercutting the price of tabletop games as you point out. I'll grant that games from Hasbro and Mattel are suffering a bit at the mass market level - that's a natural byproduct of the emerging tipping point, and we saw similar declines and power shifts amongst the large companies on the digital side when the tipping point occurred there.

So what is the actual relationship between digital and tangible games? I believe that it's far more symbiotic than we give it credit for. Why else would an explosion of new, cheap digital games during a difficult economic time lead to significant growth in tabletop games? Why else would there be such overlap in the regional markets for digital and tabletop games and why would the growth of those markets rise and fall in tandem (both are on a significant growth curve in China and Brazil, for example, while both are largely stagnant in India)?

Thanks for joining the discussion and sharing your considerable insight and experience, Lewis! And your reminder that games are ultimately about the experience rather than the winning and the losing is well-taken.

[Scott Moore]

Interesting to read a US point of view about the games industry. But the mere fact that you focus so much on Settlers of Catan beautifully illustrates how far behind the curve the US is. In Germany social gaming (I prefer to use this term because many are not board games but card games) is a family activity and "Euro" games have been mass market items for many years. Around 500 new board and card games are published every year, the majority by German companies such as Kosmos and Ravensburger who have been quicker than their US counterparts in taking advantage of this new market segment. The world's largest annual convention for such games - held in Essen - attracted 154,000 visitors in 2010.

[jim Johnson]

Excellent Article - Useful for anyone interested in understanding both activities of traditional board games and digital games.
And remember - The consumer rules - not the seller of discretionary products or services. Any product that is produced - It is not about what the owner of a business entity wants or what any company or entity produces - It’s about meeting consumer wants and (consumer demand) /or where consumer demands is or is going. It's the consumer experience that counts. And the pricing of the consumer experience. Jim Johnson / www.bowlgamer.com -