Article re-posted from October 13, 2014
When going about analyzing new markets, one might do well to consider looking at the changing of demographics in society: with a birth-index of less then 2.1 (the index required to replace existing populations), most Western countries not only have shrinking populations, but a demographic shift towards older people.
Now most people within the current, or near-future retirement age didn’t grow up with videogames, or were late-adopters, in which it’s safe to say the majority probably will be more drawn to reading novels, browsing the internet and watching television (along with the occasional card-/boardgame).
However, the first generation of gamers is well into the 40s, with even general gamer-averages already shifting towards aging gamers. Now we’ve all seen the increase in retro-game sales (for example GOG, and now on Steam), but have we considered that these people might want new and unique entertainment, that plays to their nostalgia?
I love the games-of-old, and often tried DOS-boxing them again, but quickly got frustrated with how dated and unpolished most 90s games were (not to mention horrible UI and balancing). We’ve probably all wished for ‘why don’t they make this game, exactly like it was, just better’ productions, yet the industry is still way too focused on being ‘hit-driven’.
Some of the most profitable and long-lasting game-companies build hardcore niche games,.. think about that… why is that?
They are delivering to their target audience, and have little to no competition because everyone is trying to shoot for the stars.
My point is not to, not shoot for the stars, but merely look at the videogame market as a broad spectrum of niche’s, and some (overcrowded!) mainstream genre’s: this might be a good business-case to make the games you always wanted to make, rather than feeling forced to ‘shoot for the stars’.
If someone were to make ‘Command and Conquer Tiberium Sun HD‘, which simply takes the game exactly as is, yet makes it 3D, polished, beautiful yet with a bit of a isometric/retro-look to it, clean graphics, meaning no wishy-washy blurs and depth-of-field effects, it would sell well. Sure, it won’t make 1 billion USD, but only a few games a year do that, and mostly these are games with investments of around 200 million USD.
Starcraft 2 is a great example of a game that plays towards the original Starcraft 1 audience, and doesn’t attempt to ‘broaden the audience by compromising the concept’.
They could for example have taken the ‘next gen graphics’ approach and littered the game with particles, blurs, etc. (like C&C3 did), yet knew very well that their target audience wouldn’t care much beyond the first 10 minutes, and from then on gameplay and easy competitive-driven visibility was key.
Too many times you see IP’s fail because they try to ‘broaden the audience’ yet fail to deliver the experience the original audience wants. That’s not to say you shouldn’t experiment, but you should always play towards the expectations of who you are selling to. Starcraft managed to go big with their niche, but most can stay small and focus on their audience, making them profitable, long-lasting and fun.
Long story short; there’s a case to be made for niche markets, if you can keep investments down, and focus on what your target audience wants. So you think there’s a market for HD retro-gaming remakes? You’re probably right, yet don’t spend 50 million dollars doing it, use smaller budgets and economically, rather than the slim possibility to make 50 million profit over 1 game, you could make 1 million profit per game, reliably… now which accountant wouldn’t high-five you for that?
This leads me to the original topic: Retirement Home Gaming (which could become a huge niche!); with the aging gamer in their 40s, within 30-40 years tops, they’ll be the first in retirement homes playing videogames against each other. The hand-eye coordination will be bad, so likely the games won’t be fast-paced, or if they are, limit nauseating featuresets like motion-blurs/depth-of-field/etc. and focus more on clear-cut graphics (like Team Fortress 2 for example) that are easy to grasp for the ‘aging eye’ (ignoring the fact that bionic eyes might become a reality by then).
Think of the good ol fun of retirement homes then, no more boring card-games, or ‘The Price is Right‘ on everyone’s TV (another example of brilliant non-hype-driven-television), but instead retirement home gaming tournaments, MMO’s, and maybe even competitive retirement home gaming teams (Orlando Retirement Home A, versus New York retirement home B). Twitch-TV becomes flooded with old people streams and entire gaming communities pop up aimed specifically for these groups of gamers.
Now the good thing is that we probably won’t need to wait 30 years for this to become a reality; as many older people have started picking up on ‘Peggle‘, ‘Candy Crush‘, ‘Farmville‘, ‘DrawSomething‘ and many more casual games; the stage might already be set for the starts of this market, and what’s great about it, is that niche markets hardly switch from one hype to another, meaning they are loyal customers; why do you think the golden word for Free-2-Play investments nowadays is ‘mid-core’?
It used to be ‘casual Farmville house-wife’, yet now everyone is gunning for mid-core… This is because while mid-core is more niche than casual, generally they are more loyal and spend more money.
Now when have you ever had an old person change a habit? Hardly ever right? Now imagine if you got the aging gamer hooked now, or older people in general, how healthy and long-lasting do you think your business will run? ‘The Price is Right’ has been running since the 50s!!!
McDonald’s built it strategy around creating a ‘fun experience for kids so when they grow up they’ll remain loyal customers as they have positive memories and a strong attachment to the brand, therefore taking their kids there, keeping the cycle going’ -> you think that clown’s there for us?
Business aside, for me, the future is only going to be great, I don’t fear aging, as I think with modern technology and medicine, the downsides will be minimized, while you’ll not only be a more ‘complete individual’, you’ll also have the time to explore / re-live / spend time on entertainment, that you never really anymore ever since you were a kid.
Now hows that for optimism?