The biggest difference from one year ago with China’s mobile startups is that the local market is actually viable.
China now has more active iOS and Android devices than the U.S., up from about 40-50 million in circulation the last time I visited in late 2011. What that means is local entrepreneurs can finally build real, scalable mobile software businesses.
iDreamSky, which started four years ago, is one of the companies riding this wave.
They started back in 2009 and have grown to about 200 people through publishing some of the West’s best-known mobile games like Halfbrick’s Fruit Ninja and Imangi’s Temple Run in China.
The Chinese market isn’t like the rest of the world. There are myriad Android app stores, run independently of Google. There are different social media channels through platforms like Tencent’s WeChat and Sina Weibo. Then there are different local tastes for music and art.
“Finding a partner that knows how to localize your game doesn’t mean just translating the game in Chinese,” said co-founder and executive vice president Jeff Lyndon. “It’s also about adding unique content.”
He said in Fruit Ninja, iDreamSky added Chinese blades for cutting the fruit and localized backgrounds.
They also changed the monetization strategy in Temple Run. The Western version of the game asks players to buy virtual gems to revive their character. But in the Chinese version, Temple Run will ask players to either buy virtual gems or directly pay 2 renminbi (about 33 cents) to revive their runner.
Lyndon said re-routing players through a separate interstitial to choose packs of gems deterred Chinese players. “It’s counterproductive to impulsive buying behavior,” he said.
While other top local developers like Chukong have revealed that they’ve been making between $6 million per month, mainly from the Chinese market, Lyndon said top foreign indie games could realistically gross $4 million to 5 million per year before iDreamSky’s take.
The company splits revenue 70-30 with the developer getting the bulk, but they graduate their take to 50-50 for better-performing games. Their network has grown to about 15 million daily actives in China.
They’ve raised roughly $10 million from Redpoint Ventures and Legend Capital and compete with companies like Chukong, which publishes games while developing its own first-party titles. Yodo1 is another publisher that recently took funding from Singtel.
“There’s a new batch of the competitors, but the market is big enough for all of us to survive,” Lyndon said.
But he said one advantage that iDreamSky has is that it doesn’t have a dual role. It only publishes games; it doesn’t make its own titles. Having a dual model can sometimes lead to conflicts of interest if a studio promotes its own games over a third-party title, or even borrows ideas liberally from a third-party studio, he said.
“We have a very strong mandate,” he said. “If we want to be a publisher, we should never be a developer.”
He added that the market is changing rapidly. Tencent’s WeChat, which blew up over the last year and grabbed 190 million monthly active users, is poised to be a major distributor of mobile games. South Korea’s Kakao has pioneered this model; games distributed by the Kakao messaging platform dominate the top-grossing charts in the country.
“WeChat is going to be one of the biggest trendsetting elements of 2013 for the Chinese market,” he said. “Once it opens up, as Kakao and Line being have already shown, WeChat will deliver the same results or even better.”
For foreigners, Lyndon said there’s a limited window to break into the Chinese mobile gaming market (which might be a bit of a self-serving thing to say.)
He said local developers are getting increasingly better at catering to the local market, and they already dominate the charts with the exception of titles like King’s Candy Crush Saga.
“The Chinese market has changed dramatically. It’s getting harder for Western developers to come in,” he said. “If you don’t come into China earlier, you might not be able to come in in after next 24 months.”
Another move in the oh-so-hot mobile messaging space today: South Korea’s Kakao Inc, which owns the KakaoTalk cross-platform mobile messaging app, has inked an agreement with digital marketing company IGAWorks to bring its mobile ad product, adPOPcorn, to the messaging app.
IGAWorks will also provide adPOPcorn to game developers whose products integrate with KakaoTalk. In a press release, the pair said the adPOPcorn advertising platform provides “in-game/in-app incentivized ad offers, including integrated advertising pop-ups, higher conversion rates and traffic, to social and mobile media channels while offering in-game items and other incentives to players”.
Mobile messaging companies are using a variety of strategies to monetise the large user-bases they have built up by offering free messaging services. It’s worth flagging that messaging giant (and KakaoTalk rival) WhatsApp has taken a public stance against advertising – but the company does (generally) charge yearly subscription fees to monetise its service, after a first free year. Other messaging apps, such as Line, have been using in-app entertainment-focused purchases such as stickers and game-related content to generate revenue.
KakaoTalk, which now has 90 million registered users, booked a profit of $6.3 million for fiscal 2012 on revenue of $45 million, according to Forbes. Building out its ad platform is an obvious way to supplement revenues from the 100 or so gaming apps on its platform (KakaoTalk takes a 20% cut of game sales). The bulk of KakaoTalk’s 2012 revenue came from game sales, according to Forbes – so today’s news means it’s adding a mobile advertising string to its bow.
KakaoTalk has also previously announced plans to create its own Android launcher, following Facebook’s launch of Home: a messaging-centric skin for Android devices, designed to keep users chatting within Facebook, rather than via third party apps. Yesterday Facebook announced Home downloads have reached close to one million. It’s unclear whether KakaoTalk’s launcher could display adPOPcorn ads in future.
Here is a listing of NYC Business and Technology Events for the upcoming week (4/26 – 5/2) that we thought would be beneficial to our small business community in the Greater NYC area.
Have a business and/or technology event coming up in the New York City area that you’d like us to add to our weekly post? If so, email us at eve...@smallbiztechnology.com.
May 3, 2013, – 1:00 PM to 4:00 PM, Science Industry and Business Library, 188 Madison Ave, New York, NY 10018
Identifying and locating the right target customers is essential to generating business for your company. Developing regular, meaningful contact with customers and prospects should be the engine for generating new business. What is the best way to communicate? What are the strategies to develop new prospects and get more business from current customers? In this seminar we talk about ways to efficiently drive sales by “touching” Customers, Prospects and Referral Sources in a planned, focused approach. This workshop will help identify why prospects make buying decisions, making it easier to close the sale.
May 6, 2013 at 9:00 AM, 71 West 23rd Street New York, NY 10010
The communications landscape has changed and continues to evolve. How we speak, engage with, and
market to consumers has also changed. What hasn?t changed, however, are the principles and pillars of a solid marketing program foundation. A successful marketing program isn?t just made up of tactics, actions, and daily posts on social media channels. A successful marketing program is built on a solid foundation of pillars and principles. It is on this solid foundation that all of your marketing and communications initiatives, including social media, should be built to maximize results.
May 6, 2013, - 12:30 PM to 5:00 PM, 1871 Broadway, New York, 10023
TheBizDen Business Summit is back and more rocking than ever. This year’s focus is on the emergence of social media and its importance to startups, individuals, students and even large fortune 1000 companies. Do you listen to your audience on social media platforms? Why should one even bother? Join us on May 6 and hear from our esteemed speakers on why it is more important than ever to leverage such tools to get ahead (both as a company and individual). See you there! You are awesome!
May 7, 2013, – 10:00 AM to 1:00 PM, Science Industry and Business Library, 188 Madison Ave, New York, NY 10016
Last year’s websites are not going to cut it in today’s mobile and social world. Learn what customers and clients expect today when they look for your business online, and how to get a website that will attract and keep clients. With all the options online for building a website today, you need to understand the differences. Websites today need to be search engine compliant, social media friendly and mobile compatible. Find out what questions to ask when hiring someone or how to do it yourself.
May 7, 2013, – 6:00 PM to 9:00 PM, The New Yorker Hotel, 481 Eighth Ave, New York, NY 11210
Companies that use full-feature integrated marketing strategies are more likely to expect to outgrow their competitors in one year, when compared to those that don’t have a marketing plan. We invite you to join Ajax Union’s CEO, Joe Apfelbaum, and President, Zevi Friedman, as they teach you these results-driven business to business marketing methods. Our Ajax Union leaders will go over a medley of business techniques, including Strategizing and Planning, Data Acquisition, Reading Analytics, Campaign Planning, and Reporting Results
May 9, 2013 – 6:00 PM to 8:00 PM, 488 Madison Ave, New York, NY 10022
Please join the Columbia Business School Alumni Club of New York’s Media and Entertainment Committee on May 9th, when five leaders in the field of multi-cultural digital and multi-channel marketing share their experiences, challenges, successes, opinions on what it means to be a multicultural marketer today, view of why digital is a key component of an effective multicultural strategy, and vision for the future with us.
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Save for later service Pocket debuted a new feature today, which allows users to quickly send content saved to their Pocket accounts to contacts from within the app. The feature uses that most old-school of social sharing means, email, but updates it with more modern social features, adds in-app and push notifications, and saves frequently used connections for easy future access.
The Send to Friend feature focuses on sharing as communication between two people, rather than the kind of broadcast model of one-to-many generally preferred by the most popular social networks like Twitter and Facebook. Pocket founder and CEO Nate Weiner explained that the company was finding email was the most popular method of sharing on the platform, so it made sense to flesh out that feature.
“If you think about consuming, the act of doing it is private – you’re not sitting next to somebody reading, but once you’re finished with it you want to share,” he said. “With Pocket, we feel like we’ve done a really good job of that private consumption experience, and with this release, we’re thinking about how do we solve that social side of things. What we’re seeing is, when you look at Pocket and how people share today, the number one way people share is via email.”
Shares via email exceed the total number of times content is shared via Twitter, Facebook and other social media channels combined, Weiner explained. That’s because with the type of content people value enough to save for later consumption, there seems to be a feeling that it’s best shared with specific people you think would be interested in that subject. Pocket’s goal was to make it much easier to share to that small group you tend to share with more frequently.
Pocket’s new share menu bubbles up a person’s most frequently used share sources, and that can now include friends and family they email most. And when you do share, you can include more than just a link – if those you share with are on Pocket, they’ll receive an optional push notification about the content, as well as any comments or highlighted sections you choose to include in a new Pocket app inbox, so there’s more context around why they thought you’d be interested.
I asked Weiner if he thought that Pocket’s one-to-one sharing might have anything in common with/to gain from the rise in popularity of messaging apps like WhatsApp, which recently revealed that it’s bigger than Twitter by active user base.
“This one-to-one thing, which nobody sees because it’s all happening privately, is so much bigger than the activity that’s happening on the public network, and I think it largely gets ignored,” he said. “But it ends up being a much higher volume, a much better signal and a much more high quality share, so I think the one-to-one stuff is really important, and I think people are going to start noticing that very soon.”
Pocket is now seeing around 35 million saves per month, which is way above its 2012 pace, when it totaled 240 million saves for the entire year for an average of around 20 million per month. This new sharing feature should result in even bigger numbers as it helps users surface more interesting content to one another.
Small business social media is a good thing…usually. Of course, this week observers in business and technology fields got a good look at how social media can also go bad.
Challenges in small business social media are inevitable. Social media tools can build your brand. But, they can also tear you down. There are many uncertainties too. Below are 10 troubles with small business social media and how to set them right.
10 Social Media Problems and Possible Solutions
Traditional Businesses Can’t Ignore It ~ BBC News
Kate Dailey reports on a hotel in Denver, Colorado involved in a $3.25 million renovation. The owners are counting on social media exposure to make their new hotel a tourist destination. Using small business social media brings its own challenges of turning clicks into customers and this one old fashioned business is focusing on creating a distinct social media voice to meet that challenge.
It’s Not as Simple as it Looks ~ The Sydney Morning Herald
Ted Rubin, social marketing strategist with content marketing firm Collective Bias, has earned a reputation as most followed chief marketing officer on Twitter. How does he do it? On a recent visit to Australia, Rubin spoke to a journalist about the secret to his success. He claims there are no tricks to his trade: just hard work, authenticity and lots of personal branding.
Your Efforts are Being Ignored ~ Dynamic Business
A recent study of Australian businesses found 70 percent offer social media channels for customer service. But only 31 percent of consumers are making use of them. Experts say the problem is outreach. Businesses must work harder to go to the social networks their customers use. They must engage as they would with any other communications tool.
There’s Too Much Noise ~ The Guardian
There is another reason small business social media is challenging. Making yourself heard above all the other social messages out there is difficult. The question becomes how to cut through all this noise to reach your customers. Small business owners should seek out areas where potential customers regularly communicate. They should cultivate customer communities that will spread the business’ brand and message to others.
It’s a Huge Time Sink ~ Forbes
Make no mistake. Small business social media takes time. That usually means time taken away from something else equally important. A professional management company gives 10 suggestions that will allow you to get the benefits you need from social media while effectively managing the time required.
Mastery Remains a Challenge ~ Penn Live
Used effectively, small business social media is more powerful than advertising and has the “power of the personal,” says business blogger John Luciew. Still, every small business is different. Luciew takes us through one fledgling entrepreneur’s journey to make social media an integral part of her startup success.
It Requires Investment ~ Post-Gazette
A recent survey shows that of 1,200 small businesses surveyed nationwide, only 20 percent plan to increase employment in 2013. But the majority of companies surveyed say they will increase spending on technology this year. That includes small business social media. Social media requires an investment. It also offers a return: more visibility, more customers, more revenue.
You Just Don’t Have the Staff ~ Charlotte Business Journal
The majority of companies may not be hiring to deal with their small business social media needs. But having someone dedicated to the task is important. Experts say one option is delegating social media chores within your company. Make it the responsibility of the advertising or public relations team, for example.
Public Relations Risks Abound ~ Small Business Trends
Last month, Jim Franklin, CEO for SendGrid Inc., lived every chief executive’s nightmare when a controversy involving his own “evangelist developer” Adria Richards, erupted on Twitter and then on Richards’ blog. The fiasco lead to the dismissal of Richards and an employee at another software company. The firings have also drawn criticisms highlighting the need for a better social media policy at the company to prevent future incidents.
It Distracts From Important SEO ~ Small Business Computing
You may already have an online presence. You may worry time spent on social media will distract your team from other important things. Your website needs SEO, for example. Tamara Weintraub, content marketing manager at ReachLocal, says there is no reason you can’t have both. Follow these 5 social media marketing tips to boost your SEO.
Social Media Photo via Shutterstock
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