How a Game About Birds Fighting Pigs Got A $1 Billion Valuation

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Growth Story is a weekly podcast that breaks down the strategy and tactics utilized by high growth companies, in a short case study format hosted by Scott D. Clary (@scottdclary)

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Welcome to success story, the mostuseful podcast in the world. I'm your host, Scott D clary. Thesuccess story podcast is part of the hub spot podcast network. The hub spotpodcast network has incredible podcast like the Martec Podcast, hosted by Benjamin Shapiro.Each week the Martech podcast tells stories of world class marketers who use technology tocreate lasting success with their business and their careers. If you like any ofthese topics, you're going to like the MARTECH podcast. How Science is changingadvertising, how to set up a crm so you actually use it. Privateequities take on digital transformation by big social is focused on newsletters. If theseare topics that resonate with you, go check out the MARTECH podcast wherever youget your podcast, or you can also go listen on hub spotcom slash podcastnetwork. Today I'm going to break down the story of angry birds. Howthey started and failed fifty two different companies and games before they finally got alukewarm success which they took. They ran...

...with the iterated. They got toover a billion dollar valuation be created an entire angry birds ecosystem. This isa start up case study. This is angry birds growth story. All right. So the story of angry birds. How they received multi billion dollar valuations, billions of dollars in revenue, hundreds of millions in down loads. Whatdo they do? So the idea of birds on sling shots trying to savetheir eggs from green pigs may seem like a rather strange idea, and itreally kind of is. But if you played any mobile games in the pastdecade, this idea is going to ring a bell. You recognize it.It's angry birds. It was the hugely popular game amongst players of all agesall interest but how did it actually achieve success with such an odd game concept, you're asking, how on Earth did they managed to actually grow at therate they did? Well, today I'm...

...going to examine how this small Scandinaviancompany launched its APP focused on birds fighting pigs, and they grew it intoa celebrated global franchise with over fifty million downloads and two hundred million minutes ofdaily Gameplay. So how did angry birds start out? So before angry birds, there was a web based game called crush the castle. The mechanics ofthis flash game served to be the inspiration for the Finnish company Rovio Entertainment.See, back in two thousand and nine, Rovio was in a tough spot financially. They were struggling. Despite challenges they were facing, they continue torelease new APPS, new games. Angry birds was one of these games thatcreated when they were really financially destitute, and it's hard to imagine that,but when they actually launched angry birds, it was not a hit. Itis a very, very apathetic response from the market towards the game. Sothey had to take this game that was released. They had no money,it wasn't that popular and they had to...

...that to push it that the market. It had to grow it to the point where it was featured on theAPP store. And when it was featured on the APP store, that's whenit became a quote unquote, overnight success. The game got into multiple top mobileAPP spots across different countries for a significant period of time. But thatwas only after all the work that they did behind the scenes. Of course, once the game was featured in the APP store years later, that wasa flywheel. That was a domino effect in Rovio's favor and millions and millionsof people globally download of this game. But how did they get there.So it may seem that just appearing in the APP store and being featured ina APP spot a top download. It may seem that that's simply luck andthat their overnight success allowed them to take angry birds from just this initial conceptand released to a global phenomenon. But that was far from the actual case. First of all, angry birds was not their first game. So Robowas creating tons of games. The company...

...had to work continuously for success theywere able to enjoy with the angry birds franchise. And, just to putin perspective, by the time Rovio released angry birds it was the company's fiftysecond game release. The studio persevered in the face of the lukewarm reception thatangry birds received. It was their severance that push the game to achieve thatsuccess. So at its core, what was angry birds will at its core, angry birds was a simple concept done well. The objective is straightforward.Use a sling shot to flame birds to destroy pigs buildings. The story isalso an easy one to follow. The pigs took the birds eggs, sothe birds want to get those eggs back. The simplicity of the concept, thejovial, nonchalantinists almost rudimentary feel of this game's entire storyline just made itlight and easy to dive into. And because it had a strong baseline andhad this really strong MVP, so to speak, when they released new iterations, when they released uppdates, improvements,...

...they actually didn't have to deviate toofar from that original concept, ensuring that angry birds could keep the original charmwithout becoming stale, so they would keep the users engaged. But of course, to grow a game you need money to invest in marketing and talent.So part of the issues that game developers have is how do I make acreative monetization strategy so that it can fund the growth, because when everybody launchesa game, even if it's a great game, you still have to putit out into the world, you still have to market it. With anybusiness, you still have to put some money behind that marketing strategy that willallow people to discover it. So if you don't have money, it's reallyhard to get your game in front of people. So they, Rovio,came up with a very creative mark getting strategy. With such a simple gameconcept, rovio had to think of clever ways to monetize the game. Angrybirds had monetization tactics, that say, they had to monifization tactics at upfrontpayments and they had in game payments. So well, users only played thegame for short bursts of time. So...

...think about you. You go intoan APP when you're bored, when you're, you know, maybe at a breakat work or you're emitting classes at school, and you play a couplelevels and you shut it off and you go about your day. So roviounderstood the behaviors of the average angry birds player and they were playing it forshort bursts of time, but they were playing it every single day. Sorovial monopolize on this pattern and made a business model that allowed players to purchaseitems or advantages to difficult situations that allowed them to make that short period ofgame time, of playtime, much more lucrative and rewarding. So if youonly were able to play for a few minutes a day, there would betime bound restrictions that you could actually purchased to overcome, as well as otherthings that would inject some added benefit into the game to help you overcome obstaclesa little bit quicker than if you just had to play through them without spendingany money. So the game encourage players to continue playing well, being temptedto purchase advantages that would propel them through...

...the game with a greater ease.Rovo also implement a content that could be accessed by paid users only, soif a player wanted to get more angry birds content, they had to payup. This created an entire virtual economy to support the game, and thevirtual economy was smart because it obviously monetize. So now Roveo is making money,but also because people invest into the game and it's a strategy that notonly makes the company money, but once the players have invested money, nowit's increasing the playtime, the retention because there's now a financial incentive for theplayers to log into the APP. So, although it really benefited their North Starmagic or their key KPI, which would be revenue goals, it alsoimproved all their other metrics of Kpis, like playtime, active usage, minutesspent in the APP, so on and so forth. Rovio also realize thatthe community that they had first brought into the game was giving them feedback,that there was something special about the world they created. Remember the very simpleworld. But you fell in love with...

...these little characters and Rovio didn't justsay okay, we have a great storyline. We hit gold with this storyline.That's so simple. It's a great video game. Let's see what elsewe can do with these characters. So when the game got really popular,they capitalize on the appeal for their characters and what they did was they builtan ecosystem. They built in sillery products. They were angry bird products that hadnothing to do with the video game, just to allow people to get angrybirds outside of that game. So they built an entire franchise around angrybirds. The franchise branched out from the simple mobile game into multimillion dollar branddeals, a TV series and even a blockbuster movie. They realize that ofcourse you're great revenue opportunities. But when they created that ecosystem, when theycreated that Brandon, they blew it out into all these different assets. Willnow you are creating this ecosystem that reinforces...

...your core product and it gives thosemost loyal fans of that core product more outlets to consume. So yes,it is a little risky to go outside your core competency, but if youstart to see that what you've created is resonating with the market to the pointwhere they're becoming super fans. Sometimes it's not the worst idea to see whatelse you can create for that community and listen to your community that you havecreated, because they're going to point you in the direction of where they wantyou to go as a company and other things they want you to create.Lastly, they didn't just market angry birds by building out this incredible brand andgoing into mainstream media. They also focus heavily on APP store optimization, somethingthat many developers do not think about when their first putting out a game intothe world or product into the world, and this is a lesson that canbe carried over into, for example, optimization across your social media. Whenyou're putting up content on social media for a startup or a business, itcan be thought of as well. If I'm going to be taking a productto market, have I optimized the content...

...on my website? Wherever the consumeror the audience interacts with your content, have you optimized that so that whenthey hit that landing page, they hit that APP store download page, areis there a higher chance of them converting? Are they getting the information they need? Are you basically removing any friction in them using your product, serviceor, in angry bird's case, the game? So, to ensure theangry birds success, roveo optimize their content for the APP store, giving theirgame the best possible chance of going viral. So a catchy image instantly capturing theconsumers attention, with a heavily keyword optimized description allowed the user to geta sense of what the APP was, what the game was, before theydownloaded it, which means that when they did download it, they knew exactlywhat they were getting. They were leaving good reviews, they're leaving positive reviews. You weren't tricking them into trying your APP and they were getting something differentthan what they thought they were getting.

It was all very transparent and optimizedwith the end user or the Gamer in mind. So we just recap onsome of those points. They had a creative monetization strategy. It was avery simple concept done well. They focused on building out a franchise and anecosystem and they also optimized and focused, were hyper focused on the customer experienceor the user experience. Those four things allowed them to be a quote onquote overnight success, along with the fact that they just wouldn't give up.Remember fifty two games before they found one that really hit home. Now roviohas produced some of the most impressive growth statistics in the industry. Angry birdshas netted in two thousand and twelve twelve billion dollars in revenue. In twothousand and seventeen and netted fifty billion dollars in revenue, and that was yearsago. So you can only imagine what they've achieved to date. They haveover three point seven billion total downloads.

The success of anger birds was aculmination of marketing, optimization, simplicity and perseverance for items that, if copyand paste it to many different industries, could yield success across countless verticals andindustries. This is not just something that works for Mobile APPs. Some ofthese lessons can be applied. All these lessons can be applied to other industries, to other business ideas. So the next time you're thinking your startup ideais stupid, just remember after fifty two tries, a video game that pittedbirds against pigs netted rova billions of dollars and made them a household name inthe mobile APP and gaming industry, and always remember that an overnight success isnever an overnight success.

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