Xsolla: "You can build on success, you can't grow from the ashes of a failed launch"
Company president Chris Hewish discusses how to establish a new studio and service game in a crowded market
Growing a new games business is a daunting prospect, especially in the face of competition against established companies. Regardless of genre, it's no easy task to grab attention with an original IP when millions are playing Fortnite on a daily basis and Grand Theft Auto 5 is still topping the sales charts seven years on.
The industry is rife with stories of ambitious newcomers -- or even experienced developers -- trying to produce a successful game but ultimately failing, sometimes resulting in the closure of the studio.
But Chris Hewish, president of developer services firm Xsolla, remains confident there is room in the market for studios that hope to dominate players' time with their game; they just have to rein in their expectations for the early stages.
The company assists developers with in-game stores, subscriptions and other forms of monetisation, and cross-platform play inventory systems. It already works with the likes of Epic Games, PUBG Corp and Roblox, as well as major publishers like Ubisoft, so has plenty of experience in working with the most popular online games.
The insight Xsolla has gained into how these type of games evolve over time has taught Hewish one crucial lesson.
"You can always build upon success, but you can't really grow from the ashes of a failed launch," he tells GamesIndustry.biz.
The biggest challenge, he notes, is not only gaining but also maintaining market share, particularly in the multiplayer space.
"With so many high quality games moving to the service model, it's becoming increasingly difficult to establish yourself as a new player in the industry," he says. "Many game companies still underestimate the cost of operating their game post-launch, leaving them adrift and unable to retain players long enough to generate real value."
The way to avoid this, according to Hewish, is to be more honest in assessing the kind of player base developers need for their game to succeed, rather than the one they hope for. Once this has been defined, studios will be better equipped to allocate the correct resources needed to reach this audience.
"This may result in fewer resources being available to make the game as they currently envision it," he says. "This is okay though, as it can serve as a forcing function for the developer to make a tighter core experience that actually has stronger appeal to the players.
"The developer and publisher can then engage directly with the community to grow the game over time, in response to how players engage with that great core experience. You'll see that most successful new games follow this model, but it only works because they have dedicated resources to servicing the game post launch, rather than building everything up front."
There's a balance to be struck between serving an initial core player base -- the ones that will be early evangelists and a crucial source of feedback -- and trying to appeal to new players. Hewish says developers should always be thinking about the latter "from the very beginning" so as your game evolves with future content updates, this is done with the aim of bringing in more people.
"True, the barrier to entry is low. But the barrier to success has never been higher"
"All the core game mechanics and loops should be designed for engagement and retention, and the games technology should be architected to allow for post launch updates that help sustain and expand the games core loop," he says.
This approach also requires a team with a variety of skills. Creativity and development prowess alone will not be enough; studios need to have business-minded people on staff as well. Hewish also recommends embedding marketing and community managers within the development team, along with live ops specialists.
"This ensures there are people who are acting as the voice of the player in design meetings and making feature requests that support the agreed upon business model," he says. "In today's game environment, I truly believe that marketing should be treated as another part of the development team, not a client service that triggers near the end."
Expertise should come from outside a team as well. Hewish urges that developers "don't live in a bubble," regularly speaking to other studios and game companies.
"Most developers want their peers to succeed and are often willing to share the good, bad and ugly with you," he says. "Focus on learning how other companies have dealt with managing scope and resources for post-launch success. Look at examples of success and failure to get a good picture, and don't be afraid to talk with the community.
"Players also have great insights into why something succeeded or failed; often much better insights than the game makers, who often have a biased point of view that blinds them from accurately assessing what worked or didn't."
He also warns that developers should be ready to adapt their strategy and perhaps even their development priorities as they gather feedback after launch. Players may gravitate towards a different feature or business model than studios expect after launch, but any decisions to pivot the design should be made "based on data, not emotion." Establish a defined metric to inform whether something needs changing.
The barrier to entry for video games development is lower than ever, especially with the wide range of engines freely available to anyone with an idea and little to no coding experience. But new developers should prepare for other challenges beyond simply making their games, Hewish concludes.
"True, the barrier to entry is low," he says. "But the barrier to success has never been higher due to the increase in competition, difficulties with discovery, and the move to live ops slowing the pace at which gamers churn to new games."