Leveraging Branded Virtual           Goods             YuChiang – WGTWorld Golf Tour and WGT Baseball: MLB
Brands
Why•   Everyone else does it•   Because your VC or Mentor said so•   You can’t think of anything better•   It will look go...
Contracts• They want to make money• They want to expose their brand• They want to protect their brand•   Rev shares – ouch...
The Pain•   Long prolonged negotiations•   Legal Costs•   Operational overhead•   Approval process•   Decrease margins wit...
The Good• Leverage the brand equity  –   Vanity  –   Social Value  –   Identity  –   Story• May decrease the cost of user ...
The Back of the Napkin• What is my CPI  – Will it be less with the brand     • Will it cover the rev share, fees, operatio...
Execution• Have a single person in charge of the approval  processes and reporting• Make the Brand market for you• Market ...
Renewal• Do your job on reporting and accounting• Meet them face to face a lot• Either make the brand money or get them  e...
Leveraging Branded Virtual Goods - YuChiang Cheng, WGT
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Leveraging Branded Virtual Goods - YuChiang Cheng, WGT

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YuChiang Cheng, Founder and CEO of WorldGolfTour, presented at our SF Game Monetization event on May 9th, 2012. Check out the SF Game Monetization meetup: http://www.meetup.com/SFGameMonetization/

In this presentation, YuChiang shares what he learned about working with large established brands and licensing those brands for virtual goods in his games.

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Leveraging Branded Virtual Goods - YuChiang Cheng, WGT

  1. 1. Leveraging Branded Virtual Goods YuChiang – WGTWorld Golf Tour and WGT Baseball: MLB
  2. 2. Brands
  3. 3. Why• Everyone else does it• Because your VC or Mentor said so• You can’t think of anything better• It will look good in your product• You think it will look good on your resume• It will help you get funded – Social proof• It will add realism to your product• Will decrease the cost of acquisition – Maybe….
  4. 4. Contracts• They want to make money• They want to expose their brand• They want to protect their brand• Rev shares – ouch when successful• Fixed fees – ouch from day one• Minimum Yearly guarantees – the real pain• Transactional fees – accounting pain• Penalties – downward spiral• Only structure scalable deals - one item is not enough• Give the Brand their own marketing guarantees to you
  5. 5. The Pain• Long prolonged negotiations• Legal Costs• Operational overhead• Approval process• Decrease margins with fees and/or rev share• Restrictions on marketing – Where – How – Look• Takes your focus off the product• Loss of product direction control• Much slower on iteration cycle• Accounting overhead• Reporting overhead• Constantly explain things to people who do not get your business• SLA’s
  6. 6. The Good• Leverage the brand equity – Vanity – Social Value – Identity – Story• May decrease the cost of user acquisition• May raise the ceiling on what you can charge for a virtual item ( or not…)
  7. 7. The Back of the Napkin• What is my CPI – Will it be less with the brand • Will it cover the rev share, fees, operational overhead etc….• Item Pricing – What can I charge for the item – How much more can I charge with the brand – Is the difference more or less than the rev share, fees, operational overhead etc….
  8. 8. Execution• Have a single person in charge of the approval processes and reporting• Make the Brand market for you• Market the hell out of the brand – you paid for the pain now use it• Use the same item/brand on multiple pricing levels• Use the same item/brand on multiple exclusivity levels
  9. 9. Renewal• Do your job on reporting and accounting• Meet them face to face a lot• Either make the brand money or get them exposure and prove it• Positive PR always help• Start the renewal process 12 months ahead• A good partner is rare and priceless - treasure them

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