The gaming market has been constantly evolving and growing and looking ahead it will continue its growth trajectory with some projections saying that it could approach 500$ billion by 2033. Exciting future, isn’t it? Let’s jump into 2025 and make more of great products! But before we do so, let’s stop for a minute and analyze what challenges we have faced and what we will need to overcome in the next few years along with these beautiful optimistic forecasts. Poetically speaking, let’s take a look at what’s going on behind the scenes of the game development production and how it impacts the demands on the market.
The players behavior
- Overcoming market saturation to capture players.
With so many games launching annually, it is more and more difficult to catch players’ attention. The world has seen literally everything and creating the innovative game product that will catch players attention becomes more challenging. Players are overwhelmed with the amount of ads, offers and games in general.
- Preferences of moderate free-to-play models.
Most of the players expect free games with moderate monetization. The market’s variety of games and events, offers in them making it more challenging to balance between user acquisition, engagement and revenue.
- Expectation of high quality products.
Players expect high quality products from the moment you are inviting the first testers whether it is alpha, beta, etc. The competition is high, the standards are high – nowadays there is no need and interest for players to test draft buggy products with the unknown future.
The development
- Finding your place in the market dominated by clones while embracing innovation.
Let’s start from the start, from the idea. Finding the niche and deciding on what product will be a success and bring you expected business results is not the same as it was 10 years ago. The current market is a combination of innovative products and clones of those who have already reached success where clones are dominating but where the innovative products still remain the vital part of our existence often pushed by technological advancements, risk-takers, indie companies.
- Risk-Averse Investment model fuels disposable games too?
The game development is quite costly and publishers or investors often prefer to invest into something that already has proven success. Cloning minimizes some risks but at the same time often results in thousands of products being thrown into the trash can.
- Rising expectations, rising development costs.
With the players’ expectations of high quality products, immersive worlds, coolest graphics, physics, interactions, animations and effects the costs required for the development are rising.
- Life after the launch. Sustaining post-launch support and updates.
On-going development, prompt updates, Live-Ops, regular new content are essential which means making a game is not a one time expense and the launch is not a final destination.
- High expertise in all fields is required to build the game with business value.
Turning the game development into business with ROI is the long term process requiring expertise in many fields: from technological and game design to building strong economies, smart balances and understanding of how to scale the product and its players base.
- Flexibility to embrace the new technologies and market demands.
The new technologies appearing on the market provide certain expectations and interest from the investors and players and dictate the future. Web3, AI, AR/VR – teams should be flexible to adapt them in the manner that will bring the product and business to the new level.
- High expertise, high costs for Human Resources.
High expertise of the team is required. Meaning that the costs of the Human Resources will be corresponding.
- No right to make a mistake.
Nowadays there is no right for mistakes and fast growth of the market requires you to also be fast (better faster than others), and responsive to market’s demands, players preferences, investors interest, clients business goals, etc.
Marketing and advertising
- Raising acquisition costs.
Advertising acquisition costs are rising. With a crowded gaming market, the competition is higher, the price for ads is becoming higher and higher. In 2023 global spending on user acquisition for mobile games reached 29 billion dollars which makes 3.3 billion dollars increase compared to 2022. This trend had continued in 2024 with companies allocating even more budgets to keep up with the market.
- Reduced retention and engagement due to the great variety of choice and distraction.
When trying the new game, players may abandon fast due to the great variety of other games that they are offered, reducing chances to return on investment.
- Using the new technologies smartly for your user-acquisition strategy.
The rise of new technologies such as AI, VR and AR has impacted here as well. AI tools are becoming essential in optimizing our campaigns while AR and VR help to create an immersive advertising experience and aim to increase players acquisition and engagement.
- Preference of influencer and user-generated social content.
There is an obvious preference for social and influencer content. However with the competition and content glut here – the huge amount of work should be done to reach success with this as well as constant investments into ads on social platforms to keep up with the competitors and be visible.
- Little chances for organic growth.
Social platforms – all – are saturated making it harder to grow organically without constant investment.
- Influencers, peer recommendations, personal approach and genuinity demand.
Traditional advertising is less effective – players now ignore the ads more often and choose to trust influencers and peer recommendations. On the other hand, big influencers actively promoting the games for reward may not be that effective, because players feel when it’s a bought review. The more hype and trash in socials the more need we all feel in something genuine and players communities are no exception.
- Omni-channel is not new – however learn how to juggle even better.
With the new advertising preferences like influencers, user-generated content, etc, it becomes harder to forecast the results and to analyze it. Choosing the strategy for effective scaling becomes harder, ROI becomes less and less projective compared to traditional advertising. Balancing between all of the channels of growth means learning how to juggle better.
Conclusion
For sure gaming is growing. It is being introduced into all spheres of life and businesses (from traditional gaming to education and manufacturing), acquiring new forms (brands gamification, interactive gaming tutorials, playable ads, instant gaming), pushing forward the technological innovations (web3, AI, VR, etc) and spreading to the new platforms (like recent boost of telegram).
Further growth is inevitable but only the strongest will survive 🙂
As a company that creates own products and combines this with providing full cycle development services to our clients, we see the clear trend:
– clients want to create the products fast and do a fast time to market test without the loss of quality and for the less price.
– the budgets for product requests became less (someone has to talk sincerely about the painful moments) – all know how market is hard and it makes absolute sense to test the idea as early as possible for the reasonable costs.
– clients want more than just a developer – they need an expert, partner with the understanding of their business goals and who is flexible enough to address them.
– automation and ready-to-use solutions is an extremely popular thing in any sphere: from website creation to application development. And while the high quality gaming design is not something that can be absolutely automated and built on ready templates, there is a solution and our response to this trend that we managed to build through the years of game development. Galaxy4Games Modular Solutions is what we use in our work with clients and for our own products to provide faster results for less costs without the loss of quality.
Challenges are good. It leads to innovation and brings our amazing industry to the next level every time we overcome the challenge. So let’s go friends!
