Facebook’s end goal: To be the cross-platform platform
Facebook is making its pitch to games developers: to survive you need to be cross-platform. To be effectively cross-platform, you need to dance with Facebook.
While Facebook celebrated another successful quarter last week, there was a little bit of troubling news about the future of the company’s games economy. Chief Financial Officer Dave Wehner summed up Facebook’s games dilemma in the quarterly earnings call:
Our current games payment revenue comes entirely from desktop usage and we are seeing declines in the number of people using Facebook on desktop, a trend that will make growing this business challenging going forward.
So at Casual Connect in San Francisco, Facebook made its sales pitch to game developers from all over the world: go mobile with us.
Wehner noted during the earnings call that the value of desktop advertising is trending downward. Ad revenue in Q2 2014 was up 8 percent year-over-year, but the average effective price per ad jumped 123 percent in that timeframe, while total desktop ad impressions dropped 25 percent. He said that the shift to mobile primarily caused the decline in ad impressions.
At Casual Connect, a forum for the world’s biggest social game developers, Facebook painted pictures of success for developers who worked with and advertised on the site. Deb Liu, Facebook’s director of product management for platform, made the push for developers to embrace cross-platform strategies, so gamers can have fluid continuity on desktop, mobile or tablet. The platform is still growing for games, as Facebook paid out more than $3 billion to developers in 2013.
People play where they are. They’re not thinking about platforms, but we have to think about platforms. … People who moved from playing a single platform to multiple platforms are much more engaged. We’re actually seeing 2, 3, 4X engagement on mobile; 50 percent more engagement on desktop. They’re paying around 3X more — 3 times as much when they play cross-platform. You should be able to leverage that to your advantage.
Facebook has ways for developers to not only make games better at the cross-platform transition, but get more exposure through Facebook. Liu plugged the Unity SDK, as well as Parse, as ways that developers can integrate Facebook into their games.
Liu also pushed for developers to become more active with advertising. Not only with the highly-popular mobile app install ads (which have generated more than 350 million installs), but with the re-engagement ads that bring a lapsed user back into the app. Advertisers also now have better targeting capabilities to reach users on certain devices.
While Facebook has handled mobile monetization with aplomb, the company is still working hard to get that message in front of game developers. It will be interesting to see how the games economy develops through the rest of the year.