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Business Benefits from Interactive Gaming and Big Data Analytics

Originally published February 23, 2012

In our increasingly connected society, interactive games are both pervasive and addictive. While a significant amount of play activity takes place from the comforts of our own homes, as more people equip themselves with gaming apps on their smart mobile devices, we can expect that the breadth of interactive and/or collaborative gaming environments is going to expand even more. More players, more activities, more transactions, and with mobile apps, massive amounts of location data piled on top. This sounds like a real scenario for big data analytics.

But, in alignment with the approach that I have advocated in the last year’s worth of articles, I’ll insist that before we dive into the technical aspects of what is to be analyzed and what tools we’ll use to do it, we have to consider the potential business objectives of the analysis and then consider types of algorithms. That being said, we can easily imagine at least 10 distinct business opportunities arising from either reducing resources or costs, or improving opportunities for increased revenue:

  1. System optimization: I have many years of experience in high performance computing, and the first thing that I typically consider is system performance and load balancing. Since the entire environment must be served by (presumably) a farm of computing resources coupled with a need for high-bandwidth networks to stream massive amounts of images and data, one perspective would look at optimizing the network to reduce network load by either moving cached data and images to locations close to the most demanding players or by allocating those high demand players to dedicated computing resources. This would require a continuous analysis of activities, system demand, and network loads for dynamic rebalancing.

  2. Archetypical profiles: Most of the benefits listed will rely on the existence of player profiles, especially when it comes to segmented marketing. This analysis will cluster and classify the different player archetypes in preparation for further analysis.

  3. Increase stickiness: With a multitude of options to capture a gamer’s attention, any method to increase the player’s “mindshare” will lead to greater loyalty to the game. That suggests analyzing retention, attrition, player profiles, and usage scenarios that lead to improved player experience and consequently increased application stickiness.

  4. Advertisements: The first of my benefits specifically dedicated to revenue generation is advertisement placement. These can be a subtle as “product placement,” (the same way they do it in the movies!) by strategic placement of used products within the gaming scenarios, or they can be as blatant as (which I have actually seen) billboard advertisements in the background of the playing areas.  One benefit of analysis would identify “high-traffic” areas of the game, allowing the game company to command premiums for advertisement placement in specific locations.

  5. Upsell virtual product: Many games use in-game currency for acquiring additional capabilities, tools, or other virtual products. Often real currency can be exchanged for virtual currency or for specific objects, creating a marketplace of virtual items for sale. In this situation, analyzing player behavior and determining opportunities for upselling virtual product can lead to increased revenue.

  6. Upsell real product: An interesting byproduct of popular games is real-world product ties-ins – witness the appearance of “Angry Bird”-licensed merchandise such as pillows and stuffed dolls. Again, understanding player behaviors and correlating those profiles to predisposition to purchasing real-world objects can help in multi-channel marketing to drive increased revenue.

  7. Cross-sell (Map archetypes to demographics): Correlating player profiles to demographic and psychographic profiles provides greater insight into opportunities for directed marketing of associated products. For example, a player whose extravagant virtual purchasing history aligns with an upscale real-world profile may be specifically targeted to purchase real-world items similar to those purchased in-game.

  8. Influence internal behavior: This benefit may go hand in hand with some of the other benefits. For example, if advertisements or marketing messages are placed in particular screens or areas of the game, it is beneficial to provide methods to drive traffic to that area.

  9. Influence external behavior: A more likely situation is examining how in-game behavior can influence the ways that individuals behave in other situations. An example might be conditioning behavior in associating particular in-game situations with desired actions that might be mirrored in real-world situations.

  10. Create and sell information products: I think this may be one of the best opportunities for monetization, since the collected information associated with profiles, behaviors, behavioral influences, types of in-game purchases, etc., can be linked to many different types of data to drive increased sales.
This is just a high-level conceptualization of the value of analyzing the massive amounts of data generated through multi-player interactive games, and my goal is to start the thought processes in looking at the types of analyses that can add value. In upcoming articles we will begin to look at some of these analyses in greater detail.

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