In a few short weeks, Coronavirus, or otherwise known as COVID-19, has had an unprecedented global effect. At the time of publication the novel virus has infected over 340,000 people in over 160 countries, with governments scrambling to contain the spread and protect the health of citizens. As the number of cases increases, more and more industries are buckling under the effects of restricted travel, work and national quarantine measures.
But the question remains as to whether or not digital-based industries are immune to the impact of COVID-19. While mobile games are a digital product, there are multiple facets to the industry relating to monetization, promotion and development that could continue to be impacted even after the virus is contained.
Cancelled Events Threaten Promotional Activities
Given the contagious nature of Coronavirus, many countries have banned events or large gatherings of people in an attempt to limit potential exposure. It came as no surprise then to those in the mobile gaming industry when the annual GDC Conference in San Francisco was cancelled.
GDC is not an isolated case and for many of those working in the industry, gaming conferences are integral to networking and keeping a pulse on new studios, publishers and developments. The cancellation of gaming events could have a huge effect, particularly on developers with promotional deals tied to the event. Losing a prime PR opportunity to announce a new product, company update or game could mean the difference between a game being extremely successful or one that struggles to gain attention.
It’s unclear as to when events and large gatherings will be resumed in particular countries, but it is fair to assume that it will take time for borders to reopen and travel to resume as normal for people to start attending these important events and conferences.
Quarantine increases user sessions
Self-isolation, social-distancing and quarantine measures have meant that millions of people have been contained in their homes. Huge numbers have turned to games to stay entertained, as seen last month when the Apple Store in China reported a whopping 62% jump in downloads alone during their quarantine period.
Logically with increased user sessions, players are also purchasing more in-app purchases. Coupled with larger ad revenues from longer user sessions, it would seem that COVID-19 has had an overwhelmingly positive impact upon the mobile gaming industry. However while the initial growth is promising, it could be short lived.
A global recession will impact all industries
The past few weeks have seen economists and governments confirming the worst: that a global recession is likely to occur as a result of COVID-19. As expected a recession would undoubtedly have a detrimental effect upon both publishers and developers globally.
Since many free-to-play mobile games generate the majority of their revenue from ads served within games, less brand ad expenditure from travel, entertainment or e-commerce brands would result in less overall ad revenue for developers.
While some industry experts are optimistic that there will be a fast recovery from the recession, it’s too early to tell how long such an economic rebound would take if the world returned to normal activity.
Adaptation to new user behaviour is key
As recent weeks have shown, many industries have felt both positive and negative effects from the societal disruption of COVID-19. While it’s still too early to predict when the market will stabilise, adaption to the changing situation and demand of users is key to getting through this uncertain period.
We suggest that game developers use this time to reflect and analyse game data to potentially spot new development opportunities in line with changing user behaviour. Perhaps even use the extra time in isolation or quarantine to ideate new game concepts, or see what games are working well in the market (there’s a great tool for that on the Coda Platform!). More importantly, game developers shouldn’t forget the bigger picture: the health of our family, friends and the community.
As Andrew French, COO of Coda reflects, “While it’s uncertain as to how the industry will evolve in the coming months, the health of our loved ones and local community comes first. We hope that loved ones stay safe and the general public work together to support each other during this time.”