Quarterly Market Report: Casual Gaming
Much of the recent news concerning the casual gaming market (often referred to as "hyper-casual" in media reports) is best understood in the light of the explosive growth of that sector over the last year. Due to that growth, the sector has seen some impressive venture capital investments and M&A activity in Q3 of 2019 along with new an innovative strategies by gaming companies which range from signing bonuses for new developers to subscription services for game access. In addition, the release of a peer-reviewed study which found casual gaming to be incredibly effective in relieving stress and increasing energy levels may assist the sector in its continued growth.
CASUAL GAMING MARKET SIZE AND GROWTH
While technically outside of the project criteria, some useful market data about the second quarter of 2019 has been released that was not available at the time of our previous report and which serve as an important backdrop to more recent developments detailed below.
Telecrunch estimates that the casual gaming industry will be worth $68.5 billion of the $152 billion global gaming market by the end of the year, a 10.2% year-over-year growth. In late August, an Entrepreneur article predicted that mobile app games would achieve 60% of the total gaming market by the end of the year. There were 11.2 billion total game downloads in that quarter alone, with Google Play leading iOS by a whopping 265%. However, iOS led Google Play in consumer spend in all games by 180%. For both companies, games comprised nearly 75% of the $22.6 billion consumer spend on apps despite comprising only 35% of all app downloads.
STARTUPS AND ACQUISITIONS
Ubisoft, best known for AAA titles like Assassin's Creed and Far Cry, bought a 70% stake in casual games company Green Panda Games, known for games like Sushi Bar, Terrarium, Emoji Craft, and Golf Inc Tycoon. The cost of the acquisition is not known, but it is known that Ubisoft has the right to buy the remaining 30% for the next four years. This is not Ubisoft's first move into the casual games sector; the company already has its own casual games segment, known for producing Hungry Shark, and acquired developer Ketchapp in 2016.
Ready, publisher of The Ready Games casual e-sports platform, raised $5 million in new funding in late August, drawing capital from Bitkraft Esports Ventures, Comcast Ventures, and Eldridge Industries. In the last six months, Ready has "produced 130 original game tournaments," with new hyper-casual games dropping every Monday, Wednesday, and Friday at 3 pm EST. The top 20% of high-scoring players split a cash prize between them, a lure which has contributed to Ready's 30% month-over-month subscriber growth.
On August 1, Mintegral teamed up with Morketing to host a "Hyper-casual games in East and West" summit for the ChinaJoy event in Shanghai. The event featured experts from companies like Google, Voodoo, JoyPac, App Annie and Tenjin, who shared their insights on both the Eastern and Western casual gaming market.
In July, Crazy Labs, a brand of the TabTale gaming company, offered a $50,000 signing bonus to developers who submitted "a successful Hyper Casual mobile game" to the company by September 15. Crazy Labs' overarching strategy is to "offer its expertise and know-how to developers who want to publish their Hyper Casual games," which has resulted in the publication of successful casual games like AMAZE!, Tricky Taps, and Rope N Roll.
In September, Apple launched Apple Arcade, a subscription service which offers access to over 100 games for $4.99 per month. The service is designed to provide a unified gaming experience across multiple devices, including the iPhone, iPad, Macs, and Apple TV, and offers users gaming classics like Pong and The Legend of Zelda as well as new games like Control and Super Mario Maker 2. Apple is expected to see competition later this year from Google's Stadia service and Nvidia's GeForce Now.
GAMING AND STRESS
A peer-reviewed study released in July in the JMIR Mental Health journal indicates that playing games on one's phone is more effective than mindfulness apps at relieving stress. Participants who played a mobile game for 10 minutes at a time also reported feeling more energized than those who used a mindfulness app or played with a fidgit-spinner. The latter actually reported feeling even more stressed and tired after the 5-day study period. The study suggests that games are effective because they "hit on four factors vital to reducing stress: psychological detachment, relaxation, mastery, and a sense of control" according to Dr. Emily Collins, the lead researcher.
FACEBOOK INSTANT GAMES LEAVING MESSENGER
In July, Facebook announced that its Instant Games, which by some estimates saw over 20 billion game sessions played in the last two years, is moving yet again. The platform began life in Facebook's News Feed before being brought over to Groups and the Lite app and moving yet again to Messenger. Now Instant Games will move from Messenger to the Facebook Gaming tab as part of Facebook's move to streamline Messenger, "which has become rather overstuffed with extraneous features." Available games include classics like Pac-Man, Galaga and Space Invaders as well as multiplayer games like Words With Friends and Uno.
In September, GameAnalytics released a report on the mobile games' industry's benchmarks, drawing data from the first half of 2019, which contained the following insights:
- "Only the best games achieve a Day 1 retention of 35% and Day 7 retention of 11% or higher."
- "The top 25% of games see an average Day 28 retention of around 4%."
- Casual gamers play for an average of 4-5 minutes, with the top 25%q playing for 7-8 minutes.
- Mid-core games provide the "lion's share" of revenue, outperforming casual games.
Q3 2019 NEW RELEASES
The following casual games were released between July 1, 2019, and September 23, 2019 (the date of the publication of this brief):
- Car Football League
- Crazy Kick
- Crazy Pool Master
- Dinosaur Rampage
- Granny: Chapter 2
- i Peel Good
- Songbird Symphony
- Super Mecha Champions
- The Kreator
- Total Party Kill
Note that since games are not always categorized as "casual" vs. "mid-core," we have had to make some subjective judgment calls on which games fit into which category in the above list. We have also not included any games that we could not confirm had a 3Q 2019 release date.
In addition, the following casual games are now available via Apple Arcade, with the caveat that some are likely to be re-releases:
- Shinsekai Into the Depths
- Sonic Racing
- Sayanara Wild Hearts
- LEGO Brawls
- Where Cards Fall
- Pac-Man Party Royale
- Sneaky Sasquach
- Sociable Soccer
- Manifold Garden
- Jenny LeClue — Detective
- Frogger in Toy Town
- Rosie's Reality
- Kings of the Castle
- What the Golf
- Dodo Peak
- The Pinball Wizard
- Things that Go Bump
- Assemble With Care
According to Sensor Tower, the top ten "hyper" casual games downloaded in July 2019 were:
- Fun Race 3D
- Jelly Shift
- Train Taxi
- Stack Ball
- Run Race 3D
- Bottle Flip 3D
- Line Color 3D
- Tiles Hop
The top game, Fun Race 3D saw 55 million installs worldwide, followed by Aquapark.io at 43 million installs.
We began by searching for new releases and innovations in industry publications like GameCrate, GameInformer, AndroidAuthority, IGN, GamePressure, and Metacritic, among others. Given the dominance of Google Play in the gaming market, we also used their New Releases list to contribute to our new game list.
After finding the casual games that had been released for the second quarter of 2019, we turned our attention to announcements of innovations. For this, we likewise used industry publications first, but augmented our findings with articles from reputable media sources such as Forbes, Yahoo! Finance, Reuters, Fast Company, and USA Today, among others. These allowed us to determine what is new and innovative in the industry based on the types of services and products discussed, as well as the frequency with which they are mentioned. We also included a link to a pay-walled research report that was released in late June that could also offer information on innovations in the industry. Finally, we examined recent news out of the Electronics Entertainment Expo (E3), which was held in early June to shed some light on what was discussed in terms of casual gaming at this premier annual gaming convention.