Living On Virtual Fish

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Presentation to BarCamp Scotland 2008.

Published in: Economy & Finance, Technology
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  • I guess when you're dealing with something which is as much a hobby as it is a business you have to pay particular attention to the non-financial side of things. It sounds like you have a decent balance.
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  • Back last summer I had a moderately serious discussion about setting up a paid gold-making guide. The business model would distributed revenue within an existing expert community. That logically would have the edge on quality/coverage over the single-author guides. Eventually we reached the conclusion that the competition this would create between us would kill the friendship and trust we'd built up - so the idea dropped off the radar.

    Currently, I think most of the market is becoming over-saturated: A combination of new guide entrants, Blizzard easing the pressure of gold-making within the game (most obviously daily quests), and players exhausting content (and so having less need to spend or level-up).

    But there are some opportunities which are only half-filled. In my opinion, most WoW sites are far too busy, complex, and generally hard to digest by casual players. It's a classic tech-geek flaw: Developing for you and your mates, and only serving the needs of the masses by accident. I'm guilty... and have been slowly back-tracking to provide more suitable content. Azeroth Advisor (Mentor Media) appeared in the space last year. And if you watch sites like WoW Insider (Weblogs Inc), you'll see a subtle shift away from the bleeding edge, towards cooking recipes (real ones) and other content that is going to go straight over the heads of the average Elitist Jerks reader (the expert community for the most hardcore content in the game).
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  • Hi Tim

    Congrats on being featured on the front page.

    It was a nice talk. I was thinking about it a little afterwards. Have you considered using afilliate offers as a means to guage the interest in different topics and then developing your own similar products?

    It would mean more work but I would expect the returns to be better as well. Just something to think about.

    Cheers,

    Jonathan Street
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  • The following articles loosely correlate to each of the talk's sections, and provide more depth and explanation:

    1. http://timhowgego.com/learn2play-the-new-real-money-trading.html
    2. http://timhowgego.com/adventures-in-online-advertising.html
    3. http://timhowgego.com/thoughts-on-a-socio-economic-environment-based-on-nothing.html
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Living On Virtual Fish

  1. Image: /ltus @ Flickr. Living On Virtual Fish Tim Howgego Keywords: Affiliate advertising, website monetarization, virtual worlds, gaming, wow.
  2. Source: fishtycoon.com.
  3. Source: WoW, Blizzard Entertainment. <ul><li>The “Learn2Play” Market </li></ul><ul><li>Publishing with Affiliate Advertising </li></ul><ul><li>Monetarization Based on Nothing? </li></ul>
  4. 1. The “Learn2Play” Market
  5. “ The game [book] publishing biz might just be the biggest industry you’ve never heard of. Publishers rake in about $100 million a year. … The Halo 2 guide sold nearly as many copies in its first week as Bill Clinton’s autobiography did.” Source: Marketplace, publicradio.org.
  6. Source: elsanglin.com.
  7. Virtual fishing guides… WTF? <ul><li>70,000+ unique visitors each month, majority from North America. </li></ul><ul><li>400,000+ views of content pages each month. </li></ul><ul><li>Free traffic from viral and search referral. </li></ul><ul><li>Web 1.0. </li></ul><ul><li>No effective competition… nobody gets it? </li></ul>
  8. Easy to Learn, Hard to Master Game Complexity Extent of Play Mass market? Hardcore?
  9. $2+ mil book sales revenue/year Estimated from Amazon rankings.
  10. $1.5+ mil ad revenue/year? Very rough estimated total for Affinity Media.
  11. $1.5+ mil sales revenue/year Estimated total for commercial online guides. Spugnort network $1+mil alone.
  12. 2. Publishing with Affiliate Advertising
  13. “ Don’t apologise for advertising!” (But do decide on the division of advertising and content.)
  14. Iterative Improvement Guess Evaluate Improved Guess Evaluate Balance displays
  15. $0.25 Equivalent earnings per thousand page views – first month average. $1.50 $5.00
  16. Watch Some Metrics <ul><li>Revenue/Mile - Could an ad network make more money than me? </li></ul><ul><li>Clicks/Page View – Optimise ad position. </li></ul><ul><li>Conversion Rate - How good is the product’s website? </li></ul><ul><li>Revenue/Click - The absolute value of those conversions. </li></ul>
  17. 0.22% clicks/view
  18. 0.34% clicks/view
  19. x 100 + 2-3 months Cashflow Equation:
  20. But in the future… More varied advertising Aiming for more repeat visits Guides not selling as well as they used to More competition to sell + game changes This isn’t sustainable? MMOGs don’t last forever
  21. 3. Monetarization Based on Nothing?
  22. Referred from a Website Buys Access to Paid Online Guide Uses that Knowledge in a Virtual Environment Player Seeks Knowledge of Game
  23. <ul><li>No physical product anywhere in the chain </li></ul><ul><li>Everything useful only within a virtual environment </li></ul><ul><li>Only physical output is real money! </li></ul>What’s so special?
  24. Image: clickr_clickr @ Flickr.
  25. Source: Hot-or-Not. Sold 100,000+ in the first year.
  26. “ 5 years from now [2006], I think the impact of their work will be widespread and deeply meaningful in ways we can't even comprehend yet.” James Hong on Hot-or-Not's Virtual Flowers.
  27. Art: simianuprising.com. Tim Howgego tim @ capsu.org tim.capsu.org www.elsanglin.com

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