SlideShare une entreprise Scribd logo
1  sur  22
Turning the Tables for Zynga
  IM661 Entertainment Industry Analysis – KAIST Business School
      Team: Inseok Kim, Noksil Kwon, Anggriawan Sugianto
Turning the Tables for Zynga

Outline
1. Environment
2. Company Profile
3. Problem
4. Alternative Solutions
5. Recommendation




   turn the tables
   •   (idiomatic) To reverse a situation, such that the advantage has shifted to the party which was
       previously disadvantaged.
Turning the Tables for Zynga

Environment
Game Industry

                                      1980                                                     2010
                                                          1990
                   1970
                                                                        2000


                                          Boom

Arcade & Console                                 Crisis                        DDR        Wii,        Kinect,
                      Arcade:                                                             Live        move
                                 Space              Famicom
                      Galaxy
                                Invader




                                                   Boom                  Distribution, Subscription,
                                                                           Ad, Freemium, Social
   PC & Web                                                      Web
                      Space
                                                                 Game
                       War



                                                                                                 Boom
                                                              Tetris,      N-Gage
                                                              Snake
Mobile & Handy                                                                  Nintendo DS
                                                                                Touch Screen
                                                                                       iPhone,
                                                                                         App
Turning the Tables for Zynga

Company Profile
Zynga Inc.

From 2007 to 2012
       Founded in 2007,
       Trading on NASDAQ since 2011,
       Acquired around 25 companies including video game maker, board game company
                  and online poker tracker company,
       Opened over 18 satellite offices and international studios in Japan, China, German, U.K. and India,
       Operating 27 games of arcade, casino, simulation genres.


1400                                   1400                                   100%
                                                                               90%
1200                                   1200
                                                                               80%
1000                                   1000                                    70%

                                                                 Ad.           60%
 800                         DAU        800
                                                                 Pokers        50%                     Inter.
 600                         MAU        600
                                                                 Others        40%                     US
                             MUU
 400                                    400                      Ville         30%
                                                                               20%
 200                                    200
                                                                               10%
   0                                      0                                     0%
          2011       2012                      2011    2012                           2011   2012

             Users                            Revenues                       Revenues by Geography
Turning the Tables for Zynga

Problem
Symptoms
Bearish Stock Price
•   Dec 16, 2011: IPO at $10
•   Mar 2012: Highest price ever at $14.5 (+45%, 2 month after IPO)
•   Nov 2012: Lowest price ever at $2.09 (-79%, 11 month after IPO)
•   Mar 2013: $3.42 (still -65.8% since IPO)

Employment Termination
•   Feb 2013: Zynga closes 4 offices: New York, Baltimore, Austin (TX), McKinney (TX)
     –   All four of the offices had recently lost their leaders, and many were associated with big flops for the
         struggling maker of social games.
•   Dan Porter, GM of Zynga NY (and ex OMGPOP CEO) felt its employees are not happy
     –   Ex-engineers also felt dissatisfied with company direction
•   Mass layoff in several offices, while executives and creative talents have already resigned before


Out of Competition
•   Zynga closed PetVille, Mafia Wars 2 and nine other games
•   Zynga‟s games even are not listed in the top-10 most profitable mobile games (2013)
Causes
Over-reliance to Facebook
•   “Mutual” relationship
•   12% of Facebook‟s revenue (2011) came from partnership with Zynga
     – It was $445 million of $3.71 billion in sale
     – Payment: Facebook takes 30% virtual goods transaction
     – Advertising: Zynga spent on Facebook advertising
          •   Zynga users also increase Facebook pageview  Good for Facebook advertisers
•   94% of Zynga‟s revenue (2011) came from Facebook
     – Facebook accounted for 81% of Zynga‟s accounts receivable


Unprofitable Users
•   Zynga relies on a small percentage of users for nearly all of its revenue (whales)
     – Less than 10% of users spend money
     – Less than 1% of users are responsible for between 25-50% of the company‟s revenue
External Factors

     Opportunity                                            Threat

Game Industry                                      Facebook’s Growth
•   Game industry is growing fast, especially in   •   Zynga and Facebook revised their long-
    online multiplayer games and social/casual         term partnership by changing their
    games.                                             agreement.
•   Zynga has the resource to develop more         •   Now Facebook is free to develop their own
    games.                                             games.


Online Gambling                                    Competition
•   The future of online gambling seems good       •   Barrier to entry for social network-based
    for Zynga‟s current financial                      games in general is relatively low.
    situation, although it‟s not good for their    •   This situation can distract Zynga‟s potential
    reputation.                                        new users to other options.


Mobile Games                                       Mobile Games
•   Mobile game industry is growing fast.          •   Zynga has limited killer apps in mobile
•   Zynga‟s games are well-matched with                games compared to the competitors.
    mobile and Zynga has resources to
    develop.
Key Question




  How should Zynga grow its business
to turn the table and regain its credibility
         from the shareholders ?
Turning the Tables for Zynga

Solutions
Alt1:    Farm! New Location Ville!
              Zynga should expand its business to Asia market, especially China
• Based on Q4/2012 report, 59% of Zynga‟s revenue came from US market, while the remaining 41% were from
  International market.
• Meanwhile, there is a significant growth in online/mobile video games industry in Asia, especially in China. The growth of
  online/mobile game in China is 266% larger than in US.
• Therefore, business expansion to Asia/China market is a great alternative.


          Strategy                                                                        2007–2011 growth in online/mobile
PARTNERSHIP WITH RENREN                                                                      video games (US$ millions)
                                                                                           Russia             687
• Renren is one of the biggest social networking services in China, with
                                                                                   United States                    1286
  162 millions of registered users (2012).                                                  Japan                       1376
• Renren is strong in MMORPG & casual gaming, but not in social                        South Korea                        1750
  gaming.                                                                                   China                                               4707

• Why Zynga-Renren partnership is beneficial to both:                                                0       1000       2000     3000   4000   5000
  1. Zynga can expand its user base to Asia, especially China as the
     biggest market, and generate more revenue.                                                 Online Game Market (US$ billions)
  2. By enhancing their game portal with Zynga‟s successful                       35
                                                                                                                                                 1
                                                                                                                                                 2
     games, Renren can increase its MAU rate. (it was just 26.5% in               30                                                    1
                                                                                                                                        2        4
     2011).                                                                       25                                             1      4
                                                                                                                                                 4
                                                                                                                                 3
                                                                                                                    1                   4
                                                                                  20                                1            3
                                                                                                                    3
                                                                                                                                 3              11
                                                                                  15                     1
Additional Strategy                                                                                      1
                                                                                                         2
                                                                                                                    3                   9
                                                                                            0
                                                                                            1                                    7
• Build the localized version of Zynga’s game platform: zynga.cn                  10        2            3          6
                                                                                            2
• Build partnership with local game developers to distribute their games          5         3
                                                                                                         4
                                                                                                                                        10      11
                                                                                                                    7            8
  into Zynga‟s platform, or do acquisitions of local game company.                          4            5
                                                                                  0
• Fork existing Zynga games into local language                                           2009   2010   2011 2012 (E) 2013 (E) 2014 (E)
                                                                                        China Korea Europe N. America Japan Others
Alt1:    Farm! New Location Ville!
               Zynga should expand its business to Asia market, especially China


                                           PARTNERSHIP WITH RENREN
          Benefits                                                                                    Costs
China Internet growth                                          Cultural difference
• Increasing Internet usage & online game market               • Cultural discount for non-casual games
• Increasing spend on gaming industry                          • Language barrier
• Growth in mobile Internet users                              • Adaptation on various Chinese App-stores


Future prospect                                                Regulation issue
• China‟s population is over 1.3 billion, the largest in the   • Anti-addiction or fatigue system government program
  world                                                        • Low intellectual property right enforcement


Lock-in Effect                                                 High competition
• Social games with social networking service can grab         • Native-China companies & big foreign companies
  the users consistently




Competition
Tencent‟s QQ game portal, Shanda, Netease, The9, ChangYou, Weibo Games, Rovio
Alt2:    Farm! New Education Ville!
                   Zynga should develop & publish social educational games


         Strategy
                                                          Characteristics Of Zynga games
B2B PARTNERSHIP WITH AMAZON                               • Social
                                                             • Games with friends
• Bundle Zynga games with Digital Textbooks
                                                          • Educational
• Using educational characteristics of Zynga                 • Construction and Management Simulation
  games, cooperate with Amazon and plant Zynga‟s               (Farmville, CityVille)
  games on Digital Textbooks or service them through         • Mathematic Puzzle
  Digital Textbook platform „Whispercast‟                      (Drop7)
                                                             • Linguistic Puzzle
                                                               (Words with Friends)




Backgrounds of Digital Textbooks
• Estimated revenues of Digital Textbooks: $1.1 billion
  by 2014, $2.5 billion by 2017
• The number of US students under 18: 55 million
• Government policy: Bring digital textbooks to all US
  students by 2017
• Main participants of device and platform:
  Apple, Amazon
Alt2:    Farm! New Education Ville!
                    Zynga should develop & publish social educational games


                                     B2B PARTNERSHIP WITH AMAZON
         Benefits                                                                                   Costs
Take advantages of characteristics                           High development cost
• Using social interaction from all around the world users   • Modify existing games to educational games
  to classmates
                                                             • Develop more various types of games
• Utilizing the educational aspects of games
• Adopting window effects
                                                             Company brand image
Follow changes of environment
                                                             • Improve company image to become education-friendly
• Proliferation of Digital Textbooks
• US government announced to bring digital textbooks to
  all US students by 2017 and Amazon launched                Competitive advantage
  „Whispercast‟ as a platform.                               •   Amazon is less competitive than Apple in digital
Get stable revenue stream                                        textbook market
• Hardly changeable curriculums

Take Prior occupation of the Market
• Target the new market of digital textbooks and new
  industry of gamification



Competition
Apple‟s iBooks textbooks for iPad
Alt3:    Farm! New Monetization Ville!
                     Zynga should enhance its business in mobile platform
• Sales of Smartphones overtake those of PCs since 2011.
• More Facebook users connect the service via the mobile. However, FB doesn‟t provide mobile game platform and
  Zynga‟s high reliance on FB may affect its growth negatively.
• In mobile area, freemium (in-app-purchase) model is growing fast.




                                                                         !
        Strategy

ACQUISITION OF WHATSAPP
• Zynga can secure additional revenue stream in mobile gaming area
  through WhatsApp.
• Mobile is the most fast growing and WhatsApp is the largest Mobile
  Messaging Service.

What about WhatsApp?
• World largest Social Network Messaging service with over 300M                                             Src:Gartner,2012
  active users
• However, revenue model is limited to subscription ($0.99/year with 1
  year free, other OS) and pay-per-download($0.99, iOS) for
  messaging App
• Recently they announce that WhatsApp for iOS will change to
  subscription with 1 year free for improving their revenue stream
• Many competitors with other values are existing:
  Vibe, LINE, Facebook Messenger, MessageMe, KakaoTalk
Alt3:   Farm! New Monetization Ville!
                       Zynga should enhance its business in mobile platform


                                         ACQUISITION OF WHATSAPP
         Benefits                                                                                   Costs
Zynga’s game is well matched with Mobile                      WhatsApp has been focusing only on messaging
• Zynga‟s specialty is casual and social games which are      service
  popular game genre for mobile
                                                              •   Currently WhatsApp want to keep their service simple
• Zynga already launched several popular games and
                                                                  and clean
  they can re-utilize for converting to new mobile platform
                                                              •   WhatsApp API which is necessary for developing
WhatsApp is the largest mobile messaging
                                                                  games for WhatsApp Platform are not ready
• Zynga can secure a number of gamers in a short period
  of time through the WhatsApp users
Freemium gaming market is growing fast                        WhatsApp may be overvalued
• Freemium game and In-app purchase revenue                   •   Many companies, except Zynga, have eyes on
  generating (39%  65%, AppStore)                                WhatsApp
• Zynga‟s games are basically free-to-play and in-app-
  purchase model. So they don‟t have to change their
                                                              No Killer contents for mobile, Zynga may need
  revenue model
                                                              new promotion and marketing investment
Zynga can get a game promoting tool and can give
networking tool for users


Competition
KakaoTalk, LINE Messenger
Turning the Tables for Zynga

Recommendation
Recommendation:

                                          Farm! New Location Ville!
                Zynga should expand its business to Asia market, especially China
• Asia is the largest video game market at $24 bn. in 2011, and projected to grow 10.3% on CAGR to $40 bn. in 2016.
• Three of the top four video game markets in the world are in Asia: China, Japan, Korea.
• Online & wireless games, which are part of Zynga‟s core competences, contributes a larger share of total spending in
  Asia than in other regions.
• Partnership with RENREN will give Zynga new large user base as well as new revenue source from China market.


           Competitive Analysis               Alt 1         Alt 2            Alt 3                      Number of Users

 Number of Users                               H             ML              MH
                                                                                       Brand                                   Profit Margin per
 Profit Margin per User                       ML             MH               M
                                                                                     Awareness                                        User
 Game Quality                                  M             MH               M

 Cost Efficiency                               H             MH               M

 Brand Awareness                              MH             ML               H
                                                                                      Cost Efficiency                     Game Quality
 Avg. Score (L=1, ML=2, M=3, MH=4, H=5)       3.8            3.2             3.6
                                                                                                    Alt-1       Alt-2      Alt-3

     Quantitative Analysis                            Qualitative Analysis                         Future Consideration

Zynga will have > 162 million NEW              Partnership with Renren is the most           • Partnership or acquisitions of
potential users                                efficient alternative in term of                local game companies
                                               development since it can be started
 40 million (est. active users) * $10         soon by just forking and translating          • Localized version of Zynga game
(avg. revenue per user) * 0.7                  existing games.                                 portal: zynga.cn
(sharing) = $280 million
Turning the Tables for Zynga

Q&A
References
         Reports

•Zynga Annual Report 2011
•Zynga Q4/2012 Earnings Slides
•PWC Global entertainment and media outlook 2012-2016
•NCSoft IR Report Nov 2012


      Web Articles
•http://www.businessinsider.com/zynga-shuts-baltimore-new-york-austin-mckinney-offices-2013-2
•http://www.reddit.com/r/IAmA/comments/pc6j9/iama_former_fulltime_zynga_engineer_quit_6_months/
•http://techcrunch.com/2012/10/23/zynga-layoffs/
•http://www.cultofandroid.com/20765/zynga-announces-petville-mafia-wars-2-and-nine-other-games-are-to-close/
•http://www.businessinsider.com/most-profitable-games-app-annie-2013-2?op=1
•http://mashable.com/2012/02/01/zynga-facebook-revenue/
•http://www.businessweek.com/magazine/zyngas-quest-for-bigspending-whales-07072011.html
•http://news.cnet.com/8301-13506_3-57343062-17/zynga-may-have-a-great-ipo-but-beyond-that-look-out
•http://www.businessinsider.com/why-mobile-gaming-companies-are-anything-but-screwed-2012-12
•http://www.businessinsider.com/this-is-zyngas-next-billion-dollar-opportunity-2012-1
•http://www.bloomberg.com/news/2012-12-06/zynga-files-with-nevada-for-real-money-online-gaming-in-u-s-1-.html
•http://blogs.wsj.com/digits/2012/11/13/line-asias-answer-to-whatsapp/
•http://en.wikipedia.org/wiki/History_of_video_games
•http://en.wikipedia.org/wiki/PC_game
•http://en.wikipedia.org/wiki/History_of_online_games
•http://en.wikipedia.org/wiki/History_of_massively_multiplayer_online_games

Contenu connexe

Tendances

Video Gaming Trends
Video Gaming TrendsVideo Gaming Trends
Video Gaming TrendsJerome Sudan
 
Clipperton Finance Whitepaper: The new era of social gaming, who can topple Z...
Clipperton Finance Whitepaper: The new era of social gaming, who can topple Z...Clipperton Finance Whitepaper: The new era of social gaming, who can topple Z...
Clipperton Finance Whitepaper: The new era of social gaming, who can topple Z...Clipperton Finance
 
Fundraising 101 for the Game Sector
Fundraising 101 for the Game SectorFundraising 101 for the Game Sector
Fundraising 101 for the Game SectorPaul Heydon
 
Wiem, że nic nie wiem - moja krótka analiza rynku gier na Łódź Game Summit 2014
Wiem, że nic nie wiem - moja krótka analiza rynku gier na Łódź Game Summit 2014Wiem, że nic nie wiem - moja krótka analiza rynku gier na Łódź Game Summit 2014
Wiem, że nic nie wiem - moja krótka analiza rynku gier na Łódź Game Summit 2014Tomek Kreczmar
 
Digitization in game industry act2: the cloud
Digitization in game industry act2: the cloudDigitization in game industry act2: the cloud
Digitization in game industry act2: the cloudIcônes Ecoles Créatives
 
Social game revenue potential, costs, and the keys to being successful in the...
Social game revenue potential, costs, and the keys to being successful in the...Social game revenue potential, costs, and the keys to being successful in the...
Social game revenue potential, costs, and the keys to being successful in the...Mike Turner
 
Msg 2011 Brochure Fv
Msg 2011 Brochure FvMsg 2011 Brochure Fv
Msg 2011 Brochure FvYeemay
 
Social gaming for gambling industry findings june 2012 v1.0
Social gaming for gambling industry findings june 2012 v1.0Social gaming for gambling industry findings june 2012 v1.0
Social gaming for gambling industry findings june 2012 v1.0david garceran nieuwenburg
 
soZZial Investor presentation
soZZial Investor presentationsoZZial Investor presentation
soZZial Investor presentationIlya Roitman
 
Game Development - Driving Vietnam's and Your Own Future
Game Development - Driving Vietnam's and Your Own FutureGame Development - Driving Vietnam's and Your Own Future
Game Development - Driving Vietnam's and Your Own Futureaction.vn
 
Gamer 2.0, Exploring the use of Gaming, Community, & Social Media
Gamer 2.0, Exploring the use of Gaming, Community, & Social MediaGamer 2.0, Exploring the use of Gaming, Community, & Social Media
Gamer 2.0, Exploring the use of Gaming, Community, & Social MediaChris
 
Popular brands friend social gaming wsj.com
Popular brands friend social gaming   wsj.comPopular brands friend social gaming   wsj.com
Popular brands friend social gaming wsj.comTerence Ling
 
Gamer 2.0, Exploring the use of Gaming, Community and Social Media
Gamer 2.0, Exploring the use of Gaming, Community and Social MediaGamer 2.0, Exploring the use of Gaming, Community and Social Media
Gamer 2.0, Exploring the use of Gaming, Community and Social MediaKaren O'Brien
 
The world's top mobile social games companies
The world's top mobile social games companiesThe world's top mobile social games companies
The world's top mobile social games companiesSoko Media
 
Win Together in China – The Most Valuable Data for China Gaming Market | Jex Li
Win Together in China – The Most Valuable Data for China Gaming Market | Jex LiWin Together in China – The Most Valuable Data for China Gaming Market | Jex Li
Win Together in China – The Most Valuable Data for China Gaming Market | Jex LiJessica Tams
 
Challenges And Potentials for Indonesia Game Developer Industry
Challenges And Potentials for Indonesia Game Developer IndustryChallenges And Potentials for Indonesia Game Developer Industry
Challenges And Potentials for Indonesia Game Developer IndustryMarlin Sugama
 

Tendances (20)

Jago Studios Pitch Deck
Jago Studios Pitch DeckJago Studios Pitch Deck
Jago Studios Pitch Deck
 
Video Gaming Trends
Video Gaming TrendsVideo Gaming Trends
Video Gaming Trends
 
Mobile video game market trends & stakes
Mobile video game market trends & stakesMobile video game market trends & stakes
Mobile video game market trends & stakes
 
Clipperton Finance Whitepaper: The new era of social gaming, who can topple Z...
Clipperton Finance Whitepaper: The new era of social gaming, who can topple Z...Clipperton Finance Whitepaper: The new era of social gaming, who can topple Z...
Clipperton Finance Whitepaper: The new era of social gaming, who can topple Z...
 
Fundraising 101 for the Game Sector
Fundraising 101 for the Game SectorFundraising 101 for the Game Sector
Fundraising 101 for the Game Sector
 
Wiem, że nic nie wiem - moja krótka analiza rynku gier na Łódź Game Summit 2014
Wiem, że nic nie wiem - moja krótka analiza rynku gier na Łódź Game Summit 2014Wiem, że nic nie wiem - moja krótka analiza rynku gier na Łódź Game Summit 2014
Wiem, że nic nie wiem - moja krótka analiza rynku gier na Łódź Game Summit 2014
 
brgames_games
brgames_gamesbrgames_games
brgames_games
 
Digitization in game industry act2: the cloud
Digitization in game industry act2: the cloudDigitization in game industry act2: the cloud
Digitization in game industry act2: the cloud
 
Social game revenue potential, costs, and the keys to being successful in the...
Social game revenue potential, costs, and the keys to being successful in the...Social game revenue potential, costs, and the keys to being successful in the...
Social game revenue potential, costs, and the keys to being successful in the...
 
Msg 2011 Brochure Fv
Msg 2011 Brochure FvMsg 2011 Brochure Fv
Msg 2011 Brochure Fv
 
Social gaming for gambling industry findings june 2012 v1.0
Social gaming for gambling industry findings june 2012 v1.0Social gaming for gambling industry findings june 2012 v1.0
Social gaming for gambling industry findings june 2012 v1.0
 
soZZial Investor presentation
soZZial Investor presentationsoZZial Investor presentation
soZZial Investor presentation
 
Eco eco. of gaming inc.
Eco eco. of gaming inc.Eco eco. of gaming inc.
Eco eco. of gaming inc.
 
Game Development - Driving Vietnam's and Your Own Future
Game Development - Driving Vietnam's and Your Own FutureGame Development - Driving Vietnam's and Your Own Future
Game Development - Driving Vietnam's and Your Own Future
 
Gamer 2.0, Exploring the use of Gaming, Community, & Social Media
Gamer 2.0, Exploring the use of Gaming, Community, & Social MediaGamer 2.0, Exploring the use of Gaming, Community, & Social Media
Gamer 2.0, Exploring the use of Gaming, Community, & Social Media
 
Popular brands friend social gaming wsj.com
Popular brands friend social gaming   wsj.comPopular brands friend social gaming   wsj.com
Popular brands friend social gaming wsj.com
 
Gamer 2.0, Exploring the use of Gaming, Community and Social Media
Gamer 2.0, Exploring the use of Gaming, Community and Social MediaGamer 2.0, Exploring the use of Gaming, Community and Social Media
Gamer 2.0, Exploring the use of Gaming, Community and Social Media
 
The world's top mobile social games companies
The world's top mobile social games companiesThe world's top mobile social games companies
The world's top mobile social games companies
 
Win Together in China – The Most Valuable Data for China Gaming Market | Jex Li
Win Together in China – The Most Valuable Data for China Gaming Market | Jex LiWin Together in China – The Most Valuable Data for China Gaming Market | Jex Li
Win Together in China – The Most Valuable Data for China Gaming Market | Jex Li
 
Challenges And Potentials for Indonesia Game Developer Industry
Challenges And Potentials for Indonesia Game Developer IndustryChallenges And Potentials for Indonesia Game Developer Industry
Challenges And Potentials for Indonesia Game Developer Industry
 

En vedette

Zynga Inc. Strategic Audit
Zynga Inc. Strategic AuditZynga Inc. Strategic Audit
Zynga Inc. Strategic AuditTarek El Kholy
 
Zynga Presentation
Zynga PresentationZynga Presentation
Zynga PresentationEric Eldon
 
Zynga ppt -wei
Zynga ppt -weiZynga ppt -wei
Zynga ppt -weiWang Wei
 
2015_03_24 Final Research Report - Zynga (FINAL COPY) PDF
2015_03_24 Final Research Report - Zynga (FINAL COPY) PDF2015_03_24 Final Research Report - Zynga (FINAL COPY) PDF
2015_03_24 Final Research Report - Zynga (FINAL COPY) PDFCourtney Fenwick
 
History of Zynga
History of Zynga History of Zynga
History of Zynga Kevin III
 
Zynga Puppet Case Study
Zynga Puppet Case StudyZynga Puppet Case Study
Zynga Puppet Case StudyPuppet
 
Zynga IPO road show presentation
Zynga IPO road show presentationZynga IPO road show presentation
Zynga IPO road show presentationstartupsphere
 
Williamson METC 2010
Williamson METC 2010Williamson METC 2010
Williamson METC 2010colwilliamson
 
From Idea to Exit, the story of our startup
From Idea to Exit, the story of our startupFrom Idea to Exit, the story of our startup
From Idea to Exit, the story of our startupNatalie Downe
 
Sponges&Cnidarians 08
Sponges&Cnidarians 08Sponges&Cnidarians 08
Sponges&Cnidarians 08Erin Nash
 

En vedette (20)

Zynga Inc. Strategic Audit
Zynga Inc. Strategic AuditZynga Inc. Strategic Audit
Zynga Inc. Strategic Audit
 
Zynga presentation-Corporate Strategy
Zynga presentation-Corporate StrategyZynga presentation-Corporate Strategy
Zynga presentation-Corporate Strategy
 
Zynga Inc Industry Analysis
 Zynga Inc Industry Analysis Zynga Inc Industry Analysis
Zynga Inc Industry Analysis
 
Zynga Presentation
Zynga PresentationZynga Presentation
Zynga Presentation
 
Zynga ppt -wei
Zynga ppt -weiZynga ppt -wei
Zynga ppt -wei
 
2015_03_24 Final Research Report - Zynga (FINAL COPY) PDF
2015_03_24 Final Research Report - Zynga (FINAL COPY) PDF2015_03_24 Final Research Report - Zynga (FINAL COPY) PDF
2015_03_24 Final Research Report - Zynga (FINAL COPY) PDF
 
History of Zynga
History of Zynga History of Zynga
History of Zynga
 
Zynga Puppet Case Study
Zynga Puppet Case StudyZynga Puppet Case Study
Zynga Puppet Case Study
 
Zynga IPO road show presentation
Zynga IPO road show presentationZynga IPO road show presentation
Zynga IPO road show presentation
 
Zynga Stock Analysis
Zynga Stock AnalysisZynga Stock Analysis
Zynga Stock Analysis
 
Williamson METC 2010
Williamson METC 2010Williamson METC 2010
Williamson METC 2010
 
Office Humor
Office HumorOffice Humor
Office Humor
 
Friend
FriendFriend
Friend
 
10 Food
10 Food10 Food
10 Food
 
Reviews 101
Reviews 101Reviews 101
Reviews 101
 
Anger
AngerAnger
Anger
 
10 Roses
10 Roses10 Roses
10 Roses
 
From Idea to Exit, the story of our startup
From Idea to Exit, the story of our startupFrom Idea to Exit, the story of our startup
From Idea to Exit, the story of our startup
 
Profession
ProfessionProfession
Profession
 
Sponges&Cnidarians 08
Sponges&Cnidarians 08Sponges&Cnidarians 08
Sponges&Cnidarians 08
 

Similaire à Zynga: Turning The Tables

APPNATION IV - Jefferies Presentation
APPNATION IV - Jefferies PresentationAPPNATION IV - Jefferies Presentation
APPNATION IV - Jefferies PresentationMasha Geller
 
Day1 0900 kai_bolik
Day1 0900 kai_bolikDay1 0900 kai_bolik
Day1 0900 kai_bolikMediabistro
 
Web 2.0 Weekly - July 13, 2010
Web 2.0 Weekly - July 13, 2010Web 2.0 Weekly - July 13, 2010
Web 2.0 Weekly - July 13, 2010David Shore
 
Game in progress new business models for the videogame industry
Game in progress new business models for the videogame industryGame in progress new business models for the videogame industry
Game in progress new business models for the videogame industryLuc Bourcier
 
Digital Goods Real Billions
Digital Goods Real BillionsDigital Goods Real Billions
Digital Goods Real BillionsBenjamin Joffe
 
Review of the global game market 2011 and forecast of 2012
Review of the global game market 2011 and forecast of 2012Review of the global game market 2011 and forecast of 2012
Review of the global game market 2011 and forecast of 2012Jack Lee
 
Finland - Europe's Mobile App Hothouse
Finland - Europe's Mobile App HothouseFinland - Europe's Mobile App Hothouse
Finland - Europe's Mobile App HothouseWill Cardwell
 
Mobile Gaming for South East Asia
Mobile Gaming for South East AsiaMobile Gaming for South East Asia
Mobile Gaming for South East AsiaAlvin Yap
 
GDC Austin 2009 - Independent Games Summit Talk: 'And Yet It Moves: From Stud...
GDC Austin 2009 - Independent Games Summit Talk: 'And Yet It Moves: From Stud...GDC Austin 2009 - Independent Games Summit Talk: 'And Yet It Moves: From Stud...
GDC Austin 2009 - Independent Games Summit Talk: 'And Yet It Moves: From Stud...simoniker
 
The Bu$iness of Games LATAM Sept_2011
The Bu$iness of Games LATAM Sept_2011The Bu$iness of Games LATAM Sept_2011
The Bu$iness of Games LATAM Sept_2011Justin Berenbaum
 
The Bu$Iness Of Games LATAM
The  Bu$Iness Of  Games  LATAMThe  Bu$Iness Of  Games  LATAM
The Bu$Iness Of Games LATAMJustin Berenbaum
 
The Bu$iness of Games LATAM Sept_2011
The Bu$iness of Games LATAM Sept_2011The Bu$iness of Games LATAM Sept_2011
The Bu$iness of Games LATAM Sept_2011Justin Berenbaum
 
Mobango apps store
Mobango apps storeMobango apps store
Mobango apps storemobangoltd
 
Broken rules gamesday small
Broken rules gamesday smallBroken rules gamesday small
Broken rules gamesday smallMartin Ortner
 
ソーシャルゲーム、国内外の動向
ソーシャルゲーム、国内外の動向ソーシャルゲーム、国内外の動向
ソーシャルゲーム、国内外の動向Toru Saito
 
Japan Mobile Web Case Study: mobagetown
Japan Mobile Web Case Study: mobagetownJapan Mobile Web Case Study: mobagetown
Japan Mobile Web Case Study: mobagetownChristopher Billich
 
Who wants to be a billionaire
Who wants to be a billionaireWho wants to be a billionaire
Who wants to be a billionaireBenjamin Joffe
 

Similaire à Zynga: Turning The Tables (20)

APPNATION IV - Jefferies Presentation
APPNATION IV - Jefferies PresentationAPPNATION IV - Jefferies Presentation
APPNATION IV - Jefferies Presentation
 
Day1 0900 kai_bolik
Day1 0900 kai_bolikDay1 0900 kai_bolik
Day1 0900 kai_bolik
 
Web 2.0 Weekly - July 13, 2010
Web 2.0 Weekly - July 13, 2010Web 2.0 Weekly - July 13, 2010
Web 2.0 Weekly - July 13, 2010
 
Game in progress new business models for the videogame industry
Game in progress new business models for the videogame industryGame in progress new business models for the videogame industry
Game in progress new business models for the videogame industry
 
Social Gaming in Asia
Social Gaming in AsiaSocial Gaming in Asia
Social Gaming in Asia
 
Digital Goods Real Billions
Digital Goods Real BillionsDigital Goods Real Billions
Digital Goods Real Billions
 
Review of the global game market 2011 and forecast of 2012
Review of the global game market 2011 and forecast of 2012Review of the global game market 2011 and forecast of 2012
Review of the global game market 2011 and forecast of 2012
 
Finland - Europe's Mobile App Hothouse
Finland - Europe's Mobile App HothouseFinland - Europe's Mobile App Hothouse
Finland - Europe's Mobile App Hothouse
 
Mobile Gaming for South East Asia
Mobile Gaming for South East AsiaMobile Gaming for South East Asia
Mobile Gaming for South East Asia
 
GDC Austin 2009 - Independent Games Summit Talk: 'And Yet It Moves: From Stud...
GDC Austin 2009 - Independent Games Summit Talk: 'And Yet It Moves: From Stud...GDC Austin 2009 - Independent Games Summit Talk: 'And Yet It Moves: From Stud...
GDC Austin 2009 - Independent Games Summit Talk: 'And Yet It Moves: From Stud...
 
The Bu$iness of Games LATAM Sept_2011
The Bu$iness of Games LATAM Sept_2011The Bu$iness of Games LATAM Sept_2011
The Bu$iness of Games LATAM Sept_2011
 
The Bu$Iness Of Games LATAM
The  Bu$Iness Of  Games  LATAMThe  Bu$Iness Of  Games  LATAM
The Bu$Iness Of Games LATAM
 
The Bu$iness of Games LATAM Sept_2011
The Bu$iness of Games LATAM Sept_2011The Bu$iness of Games LATAM Sept_2011
The Bu$iness of Games LATAM Sept_2011
 
Mobango apps store
Mobango apps storeMobango apps store
Mobango apps store
 
3 Do
3 Do3 Do
3 Do
 
Broken rules gamesday small
Broken rules gamesday smallBroken rules gamesday small
Broken rules gamesday small
 
ソーシャルゲーム、国内外の動向
ソーシャルゲーム、国内外の動向ソーシャルゲーム、国内外の動向
ソーシャルゲーム、国内外の動向
 
Japan Mobile Web Case Study: mobagetown
Japan Mobile Web Case Study: mobagetownJapan Mobile Web Case Study: mobagetown
Japan Mobile Web Case Study: mobagetown
 
Socosoft 201108
Socosoft 201108Socosoft 201108
Socosoft 201108
 
Who wants to be a billionaire
Who wants to be a billionaireWho wants to be a billionaire
Who wants to be a billionaire
 

Plus de Anggriawan Sugianto (20)

Career Tips for Fresh Graduates
Career Tips for Fresh GraduatesCareer Tips for Fresh Graduates
Career Tips for Fresh Graduates
 
Scaling Up Your Startups
Scaling Up Your StartupsScaling Up Your Startups
Scaling Up Your Startups
 
Customer Development Model
Customer Development ModelCustomer Development Model
Customer Development Model
 
Suitmedia: Creative Digital Lab
Suitmedia: Creative Digital LabSuitmedia: Creative Digital Lab
Suitmedia: Creative Digital Lab
 
Business Model
Business ModelBusiness Model
Business Model
 
EKMA4111: Modul 9
EKMA4111: Modul 9EKMA4111: Modul 9
EKMA4111: Modul 9
 
EKMA4111: Modul 8
EKMA4111: Modul 8EKMA4111: Modul 8
EKMA4111: Modul 8
 
EKMA4111: Modul 6
EKMA4111: Modul 6EKMA4111: Modul 6
EKMA4111: Modul 6
 
EKMA4111: Modul 7
EKMA4111: Modul 7EKMA4111: Modul 7
EKMA4111: Modul 7
 
EKMA4111: Modul 5
EKMA4111: Modul 5EKMA4111: Modul 5
EKMA4111: Modul 5
 
EKMA4111: Modul 4
EKMA4111: Modul 4EKMA4111: Modul 4
EKMA4111: Modul 4
 
EKMA 4111: Modul 3
EKMA 4111: Modul 3EKMA 4111: Modul 3
EKMA 4111: Modul 3
 
EKMA 4111: Modul 2
EKMA 4111: Modul 2EKMA 4111: Modul 2
EKMA 4111: Modul 2
 
EKMA 4111: Modul 1
EKMA 4111: Modul 1EKMA 4111: Modul 1
EKMA 4111: Modul 1
 
Life in Korea
Life in KoreaLife in Korea
Life in Korea
 
BMW of North America: Dream It. Build It. Drive It.
BMW of North America: Dream It. Build It. Drive It.BMW of North America: Dream It. Build It. Drive It.
BMW of North America: Dream It. Build It. Drive It.
 
NCSoft Financial Statement Analysis
NCSoft Financial Statement AnalysisNCSoft Financial Statement Analysis
NCSoft Financial Statement Analysis
 
Timing is Everything: Paramount's Transformers 3
Timing is Everything: Paramount's Transformers 3Timing is Everything: Paramount's Transformers 3
Timing is Everything: Paramount's Transformers 3
 
IT Startup Industry in Indonesia
IT Startup Industry in IndonesiaIT Startup Industry in Indonesia
IT Startup Industry in Indonesia
 
GE's Growth Strategy: The Immelt Initiative
GE's Growth Strategy: The Immelt InitiativeGE's Growth Strategy: The Immelt Initiative
GE's Growth Strategy: The Immelt Initiative
 

Dernier

Data skills for Agile Teams- Killing story points
Data skills for Agile Teams- Killing story pointsData skills for Agile Teams- Killing story points
Data skills for Agile Teams- Killing story pointsyasinnathani
 
Intellectual Property Licensing Examples
Intellectual Property Licensing ExamplesIntellectual Property Licensing Examples
Intellectual Property Licensing Examplesamberjiles31
 
Ethical stalking by Mark Williams. UpliftLive 2024
Ethical stalking by Mark Williams. UpliftLive 2024Ethical stalking by Mark Williams. UpliftLive 2024
Ethical stalking by Mark Williams. UpliftLive 2024Winbusinessin
 
A flour, rice and Suji company in Jhang.
A flour, rice and Suji company in Jhang.A flour, rice and Suji company in Jhang.
A flour, rice and Suji company in Jhang.mcshagufta46
 
Borderless Access - Global Panel book-unlock 2024
Borderless Access - Global Panel book-unlock 2024Borderless Access - Global Panel book-unlock 2024
Borderless Access - Global Panel book-unlock 2024Borderless Access
 
Borderless Access - Global B2B Panel book-unlock 2024
Borderless Access - Global B2B Panel book-unlock 2024Borderless Access - Global B2B Panel book-unlock 2024
Borderless Access - Global B2B Panel book-unlock 2024Borderless Access
 
NewBase 25 March 2024 Energy News issue - 1710 by Khaled Al Awadi_compress...
NewBase  25 March  2024  Energy News issue - 1710 by Khaled Al Awadi_compress...NewBase  25 March  2024  Energy News issue - 1710 by Khaled Al Awadi_compress...
NewBase 25 March 2024 Energy News issue - 1710 by Khaled Al Awadi_compress...Khaled Al Awadi
 
Q2 2024 APCO Geopolitical Radar - The Global Operating Environment for Business
Q2 2024 APCO Geopolitical Radar - The Global Operating Environment for BusinessQ2 2024 APCO Geopolitical Radar - The Global Operating Environment for Business
Q2 2024 APCO Geopolitical Radar - The Global Operating Environment for BusinessAPCO
 
Graham and Doddsville - Issue 1 - Winter 2006 (1).pdf
Graham and Doddsville - Issue 1 - Winter 2006 (1).pdfGraham and Doddsville - Issue 1 - Winter 2006 (1).pdf
Graham and Doddsville - Issue 1 - Winter 2006 (1).pdfAnhNguyen97152
 
Borderless Access - Global Panel book-unlock 2024
Borderless Access - Global Panel book-unlock 2024Borderless Access - Global Panel book-unlock 2024
Borderless Access - Global Panel book-unlock 2024Borderless Access
 
Chicago Medical Malpractice Lawyer Chicago Medical Malpractice Lawyer.pdf
Chicago Medical Malpractice Lawyer Chicago Medical Malpractice Lawyer.pdfChicago Medical Malpractice Lawyer Chicago Medical Malpractice Lawyer.pdf
Chicago Medical Malpractice Lawyer Chicago Medical Malpractice Lawyer.pdfSourav Sikder
 
AMAZON SELLER VIRTUAL ASSISTANT PRODUCT RESEARCH .pdf
AMAZON SELLER VIRTUAL ASSISTANT PRODUCT RESEARCH .pdfAMAZON SELLER VIRTUAL ASSISTANT PRODUCT RESEARCH .pdf
AMAZON SELLER VIRTUAL ASSISTANT PRODUCT RESEARCH .pdfJohnCarloValencia4
 
HELENE HECKROTTE'S PROFESSIONAL PORTFOLIO.pptx
HELENE HECKROTTE'S PROFESSIONAL PORTFOLIO.pptxHELENE HECKROTTE'S PROFESSIONAL PORTFOLIO.pptx
HELENE HECKROTTE'S PROFESSIONAL PORTFOLIO.pptxHelene Heckrotte
 
Developing Coaching Skills: Mine, Yours, Ours
Developing Coaching Skills: Mine, Yours, OursDeveloping Coaching Skills: Mine, Yours, Ours
Developing Coaching Skills: Mine, Yours, OursKaiNexus
 
Talent Management research intelligence_13 paradigm shifts_20 March 2024.pdf
Talent Management research intelligence_13 paradigm shifts_20 March 2024.pdfTalent Management research intelligence_13 paradigm shifts_20 March 2024.pdf
Talent Management research intelligence_13 paradigm shifts_20 March 2024.pdfCharles Cotter, PhD
 
Mihir Menda - Member of Supervisory Board at RMZ
Mihir Menda - Member of Supervisory Board at RMZMihir Menda - Member of Supervisory Board at RMZ
Mihir Menda - Member of Supervisory Board at RMZKanakChauhan5
 
BCE24 | Virtual Brand Ambassadors: Making Brands Personal - John Meulemans
BCE24 | Virtual Brand Ambassadors: Making Brands Personal - John MeulemansBCE24 | Virtual Brand Ambassadors: Making Brands Personal - John Meulemans
BCE24 | Virtual Brand Ambassadors: Making Brands Personal - John MeulemansBBPMedia1
 
MoneyBridge Pitch Deck - Investor Presentation
MoneyBridge Pitch Deck - Investor PresentationMoneyBridge Pitch Deck - Investor Presentation
MoneyBridge Pitch Deck - Investor Presentationbaron83
 
IIBA® Melbourne - Navigating Business Analysis - Excellence for Career Growth...
IIBA® Melbourne - Navigating Business Analysis - Excellence for Career Growth...IIBA® Melbourne - Navigating Business Analysis - Excellence for Career Growth...
IIBA® Melbourne - Navigating Business Analysis - Excellence for Career Growth...AustraliaChapterIIBA
 

Dernier (20)

WAM Corporate Presentation Mar 25 2024.pdf
WAM Corporate Presentation Mar 25 2024.pdfWAM Corporate Presentation Mar 25 2024.pdf
WAM Corporate Presentation Mar 25 2024.pdf
 
Data skills for Agile Teams- Killing story points
Data skills for Agile Teams- Killing story pointsData skills for Agile Teams- Killing story points
Data skills for Agile Teams- Killing story points
 
Intellectual Property Licensing Examples
Intellectual Property Licensing ExamplesIntellectual Property Licensing Examples
Intellectual Property Licensing Examples
 
Ethical stalking by Mark Williams. UpliftLive 2024
Ethical stalking by Mark Williams. UpliftLive 2024Ethical stalking by Mark Williams. UpliftLive 2024
Ethical stalking by Mark Williams. UpliftLive 2024
 
A flour, rice and Suji company in Jhang.
A flour, rice and Suji company in Jhang.A flour, rice and Suji company in Jhang.
A flour, rice and Suji company in Jhang.
 
Borderless Access - Global Panel book-unlock 2024
Borderless Access - Global Panel book-unlock 2024Borderless Access - Global Panel book-unlock 2024
Borderless Access - Global Panel book-unlock 2024
 
Borderless Access - Global B2B Panel book-unlock 2024
Borderless Access - Global B2B Panel book-unlock 2024Borderless Access - Global B2B Panel book-unlock 2024
Borderless Access - Global B2B Panel book-unlock 2024
 
NewBase 25 March 2024 Energy News issue - 1710 by Khaled Al Awadi_compress...
NewBase  25 March  2024  Energy News issue - 1710 by Khaled Al Awadi_compress...NewBase  25 March  2024  Energy News issue - 1710 by Khaled Al Awadi_compress...
NewBase 25 March 2024 Energy News issue - 1710 by Khaled Al Awadi_compress...
 
Q2 2024 APCO Geopolitical Radar - The Global Operating Environment for Business
Q2 2024 APCO Geopolitical Radar - The Global Operating Environment for BusinessQ2 2024 APCO Geopolitical Radar - The Global Operating Environment for Business
Q2 2024 APCO Geopolitical Radar - The Global Operating Environment for Business
 
Graham and Doddsville - Issue 1 - Winter 2006 (1).pdf
Graham and Doddsville - Issue 1 - Winter 2006 (1).pdfGraham and Doddsville - Issue 1 - Winter 2006 (1).pdf
Graham and Doddsville - Issue 1 - Winter 2006 (1).pdf
 
Borderless Access - Global Panel book-unlock 2024
Borderless Access - Global Panel book-unlock 2024Borderless Access - Global Panel book-unlock 2024
Borderless Access - Global Panel book-unlock 2024
 
Chicago Medical Malpractice Lawyer Chicago Medical Malpractice Lawyer.pdf
Chicago Medical Malpractice Lawyer Chicago Medical Malpractice Lawyer.pdfChicago Medical Malpractice Lawyer Chicago Medical Malpractice Lawyer.pdf
Chicago Medical Malpractice Lawyer Chicago Medical Malpractice Lawyer.pdf
 
AMAZON SELLER VIRTUAL ASSISTANT PRODUCT RESEARCH .pdf
AMAZON SELLER VIRTUAL ASSISTANT PRODUCT RESEARCH .pdfAMAZON SELLER VIRTUAL ASSISTANT PRODUCT RESEARCH .pdf
AMAZON SELLER VIRTUAL ASSISTANT PRODUCT RESEARCH .pdf
 
HELENE HECKROTTE'S PROFESSIONAL PORTFOLIO.pptx
HELENE HECKROTTE'S PROFESSIONAL PORTFOLIO.pptxHELENE HECKROTTE'S PROFESSIONAL PORTFOLIO.pptx
HELENE HECKROTTE'S PROFESSIONAL PORTFOLIO.pptx
 
Developing Coaching Skills: Mine, Yours, Ours
Developing Coaching Skills: Mine, Yours, OursDeveloping Coaching Skills: Mine, Yours, Ours
Developing Coaching Skills: Mine, Yours, Ours
 
Talent Management research intelligence_13 paradigm shifts_20 March 2024.pdf
Talent Management research intelligence_13 paradigm shifts_20 March 2024.pdfTalent Management research intelligence_13 paradigm shifts_20 March 2024.pdf
Talent Management research intelligence_13 paradigm shifts_20 March 2024.pdf
 
Mihir Menda - Member of Supervisory Board at RMZ
Mihir Menda - Member of Supervisory Board at RMZMihir Menda - Member of Supervisory Board at RMZ
Mihir Menda - Member of Supervisory Board at RMZ
 
BCE24 | Virtual Brand Ambassadors: Making Brands Personal - John Meulemans
BCE24 | Virtual Brand Ambassadors: Making Brands Personal - John MeulemansBCE24 | Virtual Brand Ambassadors: Making Brands Personal - John Meulemans
BCE24 | Virtual Brand Ambassadors: Making Brands Personal - John Meulemans
 
MoneyBridge Pitch Deck - Investor Presentation
MoneyBridge Pitch Deck - Investor PresentationMoneyBridge Pitch Deck - Investor Presentation
MoneyBridge Pitch Deck - Investor Presentation
 
IIBA® Melbourne - Navigating Business Analysis - Excellence for Career Growth...
IIBA® Melbourne - Navigating Business Analysis - Excellence for Career Growth...IIBA® Melbourne - Navigating Business Analysis - Excellence for Career Growth...
IIBA® Melbourne - Navigating Business Analysis - Excellence for Career Growth...
 

Zynga: Turning The Tables

  • 1. Turning the Tables for Zynga IM661 Entertainment Industry Analysis – KAIST Business School Team: Inseok Kim, Noksil Kwon, Anggriawan Sugianto
  • 2. Turning the Tables for Zynga Outline 1. Environment 2. Company Profile 3. Problem 4. Alternative Solutions 5. Recommendation turn the tables • (idiomatic) To reverse a situation, such that the advantage has shifted to the party which was previously disadvantaged.
  • 3. Turning the Tables for Zynga Environment
  • 4. Game Industry 1980 2010 1990 1970 2000 Boom Arcade & Console Crisis DDR Wii, Kinect, Arcade: Live move Space Famicom Galaxy Invader Boom Distribution, Subscription, Ad, Freemium, Social PC & Web Web Space Game War Boom Tetris, N-Gage Snake Mobile & Handy Nintendo DS Touch Screen iPhone, App
  • 5. Turning the Tables for Zynga Company Profile
  • 6. Zynga Inc. From 2007 to 2012 Founded in 2007, Trading on NASDAQ since 2011, Acquired around 25 companies including video game maker, board game company and online poker tracker company, Opened over 18 satellite offices and international studios in Japan, China, German, U.K. and India, Operating 27 games of arcade, casino, simulation genres. 1400 1400 100% 90% 1200 1200 80% 1000 1000 70% Ad. 60% 800 DAU 800 Pokers 50% Inter. 600 MAU 600 Others 40% US MUU 400 400 Ville 30% 20% 200 200 10% 0 0 0% 2011 2012 2011 2012 2011 2012 Users Revenues Revenues by Geography
  • 7. Turning the Tables for Zynga Problem
  • 8. Symptoms Bearish Stock Price • Dec 16, 2011: IPO at $10 • Mar 2012: Highest price ever at $14.5 (+45%, 2 month after IPO) • Nov 2012: Lowest price ever at $2.09 (-79%, 11 month after IPO) • Mar 2013: $3.42 (still -65.8% since IPO) Employment Termination • Feb 2013: Zynga closes 4 offices: New York, Baltimore, Austin (TX), McKinney (TX) – All four of the offices had recently lost their leaders, and many were associated with big flops for the struggling maker of social games. • Dan Porter, GM of Zynga NY (and ex OMGPOP CEO) felt its employees are not happy – Ex-engineers also felt dissatisfied with company direction • Mass layoff in several offices, while executives and creative talents have already resigned before Out of Competition • Zynga closed PetVille, Mafia Wars 2 and nine other games • Zynga‟s games even are not listed in the top-10 most profitable mobile games (2013)
  • 9. Causes Over-reliance to Facebook • “Mutual” relationship • 12% of Facebook‟s revenue (2011) came from partnership with Zynga – It was $445 million of $3.71 billion in sale – Payment: Facebook takes 30% virtual goods transaction – Advertising: Zynga spent on Facebook advertising • Zynga users also increase Facebook pageview  Good for Facebook advertisers • 94% of Zynga‟s revenue (2011) came from Facebook – Facebook accounted for 81% of Zynga‟s accounts receivable Unprofitable Users • Zynga relies on a small percentage of users for nearly all of its revenue (whales) – Less than 10% of users spend money – Less than 1% of users are responsible for between 25-50% of the company‟s revenue
  • 10. External Factors Opportunity Threat Game Industry Facebook’s Growth • Game industry is growing fast, especially in • Zynga and Facebook revised their long- online multiplayer games and social/casual term partnership by changing their games. agreement. • Zynga has the resource to develop more • Now Facebook is free to develop their own games. games. Online Gambling Competition • The future of online gambling seems good • Barrier to entry for social network-based for Zynga‟s current financial games in general is relatively low. situation, although it‟s not good for their • This situation can distract Zynga‟s potential reputation. new users to other options. Mobile Games Mobile Games • Mobile game industry is growing fast. • Zynga has limited killer apps in mobile • Zynga‟s games are well-matched with games compared to the competitors. mobile and Zynga has resources to develop.
  • 11. Key Question How should Zynga grow its business to turn the table and regain its credibility from the shareholders ?
  • 12. Turning the Tables for Zynga Solutions
  • 13. Alt1: Farm! New Location Ville! Zynga should expand its business to Asia market, especially China • Based on Q4/2012 report, 59% of Zynga‟s revenue came from US market, while the remaining 41% were from International market. • Meanwhile, there is a significant growth in online/mobile video games industry in Asia, especially in China. The growth of online/mobile game in China is 266% larger than in US. • Therefore, business expansion to Asia/China market is a great alternative. Strategy 2007–2011 growth in online/mobile PARTNERSHIP WITH RENREN video games (US$ millions) Russia 687 • Renren is one of the biggest social networking services in China, with United States 1286 162 millions of registered users (2012). Japan 1376 • Renren is strong in MMORPG & casual gaming, but not in social South Korea 1750 gaming. China 4707 • Why Zynga-Renren partnership is beneficial to both: 0 1000 2000 3000 4000 5000 1. Zynga can expand its user base to Asia, especially China as the biggest market, and generate more revenue. Online Game Market (US$ billions) 2. By enhancing their game portal with Zynga‟s successful 35 1 2 games, Renren can increase its MAU rate. (it was just 26.5% in 30 1 2 4 2011). 25 1 4 4 3 1 4 20 1 3 3 3 11 15 1 Additional Strategy 1 2 3 9 0 1 7 • Build the localized version of Zynga’s game platform: zynga.cn 10 2 3 6 2 • Build partnership with local game developers to distribute their games 5 3 4 10 11 7 8 into Zynga‟s platform, or do acquisitions of local game company. 4 5 0 • Fork existing Zynga games into local language 2009 2010 2011 2012 (E) 2013 (E) 2014 (E) China Korea Europe N. America Japan Others
  • 14. Alt1: Farm! New Location Ville! Zynga should expand its business to Asia market, especially China PARTNERSHIP WITH RENREN Benefits Costs China Internet growth Cultural difference • Increasing Internet usage & online game market • Cultural discount for non-casual games • Increasing spend on gaming industry • Language barrier • Growth in mobile Internet users • Adaptation on various Chinese App-stores Future prospect Regulation issue • China‟s population is over 1.3 billion, the largest in the • Anti-addiction or fatigue system government program world • Low intellectual property right enforcement Lock-in Effect High competition • Social games with social networking service can grab • Native-China companies & big foreign companies the users consistently Competition Tencent‟s QQ game portal, Shanda, Netease, The9, ChangYou, Weibo Games, Rovio
  • 15. Alt2: Farm! New Education Ville! Zynga should develop & publish social educational games Strategy Characteristics Of Zynga games B2B PARTNERSHIP WITH AMAZON • Social • Games with friends • Bundle Zynga games with Digital Textbooks • Educational • Using educational characteristics of Zynga • Construction and Management Simulation games, cooperate with Amazon and plant Zynga‟s (Farmville, CityVille) games on Digital Textbooks or service them through • Mathematic Puzzle Digital Textbook platform „Whispercast‟ (Drop7) • Linguistic Puzzle (Words with Friends) Backgrounds of Digital Textbooks • Estimated revenues of Digital Textbooks: $1.1 billion by 2014, $2.5 billion by 2017 • The number of US students under 18: 55 million • Government policy: Bring digital textbooks to all US students by 2017 • Main participants of device and platform: Apple, Amazon
  • 16. Alt2: Farm! New Education Ville! Zynga should develop & publish social educational games B2B PARTNERSHIP WITH AMAZON Benefits Costs Take advantages of characteristics High development cost • Using social interaction from all around the world users • Modify existing games to educational games to classmates • Develop more various types of games • Utilizing the educational aspects of games • Adopting window effects Company brand image Follow changes of environment • Improve company image to become education-friendly • Proliferation of Digital Textbooks • US government announced to bring digital textbooks to all US students by 2017 and Amazon launched Competitive advantage „Whispercast‟ as a platform. • Amazon is less competitive than Apple in digital Get stable revenue stream textbook market • Hardly changeable curriculums Take Prior occupation of the Market • Target the new market of digital textbooks and new industry of gamification Competition Apple‟s iBooks textbooks for iPad
  • 17. Alt3: Farm! New Monetization Ville! Zynga should enhance its business in mobile platform • Sales of Smartphones overtake those of PCs since 2011. • More Facebook users connect the service via the mobile. However, FB doesn‟t provide mobile game platform and Zynga‟s high reliance on FB may affect its growth negatively. • In mobile area, freemium (in-app-purchase) model is growing fast. ! Strategy ACQUISITION OF WHATSAPP • Zynga can secure additional revenue stream in mobile gaming area through WhatsApp. • Mobile is the most fast growing and WhatsApp is the largest Mobile Messaging Service. What about WhatsApp? • World largest Social Network Messaging service with over 300M Src:Gartner,2012 active users • However, revenue model is limited to subscription ($0.99/year with 1 year free, other OS) and pay-per-download($0.99, iOS) for messaging App • Recently they announce that WhatsApp for iOS will change to subscription with 1 year free for improving their revenue stream • Many competitors with other values are existing: Vibe, LINE, Facebook Messenger, MessageMe, KakaoTalk
  • 18. Alt3: Farm! New Monetization Ville! Zynga should enhance its business in mobile platform ACQUISITION OF WHATSAPP Benefits Costs Zynga’s game is well matched with Mobile WhatsApp has been focusing only on messaging • Zynga‟s specialty is casual and social games which are service popular game genre for mobile • Currently WhatsApp want to keep their service simple • Zynga already launched several popular games and and clean they can re-utilize for converting to new mobile platform • WhatsApp API which is necessary for developing WhatsApp is the largest mobile messaging games for WhatsApp Platform are not ready • Zynga can secure a number of gamers in a short period of time through the WhatsApp users Freemium gaming market is growing fast WhatsApp may be overvalued • Freemium game and In-app purchase revenue • Many companies, except Zynga, have eyes on generating (39%  65%, AppStore) WhatsApp • Zynga‟s games are basically free-to-play and in-app- purchase model. So they don‟t have to change their No Killer contents for mobile, Zynga may need revenue model new promotion and marketing investment Zynga can get a game promoting tool and can give networking tool for users Competition KakaoTalk, LINE Messenger
  • 19. Turning the Tables for Zynga Recommendation
  • 20. Recommendation: Farm! New Location Ville! Zynga should expand its business to Asia market, especially China • Asia is the largest video game market at $24 bn. in 2011, and projected to grow 10.3% on CAGR to $40 bn. in 2016. • Three of the top four video game markets in the world are in Asia: China, Japan, Korea. • Online & wireless games, which are part of Zynga‟s core competences, contributes a larger share of total spending in Asia than in other regions. • Partnership with RENREN will give Zynga new large user base as well as new revenue source from China market. Competitive Analysis Alt 1 Alt 2 Alt 3 Number of Users Number of Users H ML MH Brand Profit Margin per Profit Margin per User ML MH M Awareness User Game Quality M MH M Cost Efficiency H MH M Brand Awareness MH ML H Cost Efficiency Game Quality Avg. Score (L=1, ML=2, M=3, MH=4, H=5) 3.8 3.2 3.6 Alt-1 Alt-2 Alt-3 Quantitative Analysis Qualitative Analysis Future Consideration Zynga will have > 162 million NEW Partnership with Renren is the most • Partnership or acquisitions of potential users efficient alternative in term of local game companies development since it can be started  40 million (est. active users) * $10 soon by just forking and translating • Localized version of Zynga game (avg. revenue per user) * 0.7 existing games. portal: zynga.cn (sharing) = $280 million
  • 21. Turning the Tables for Zynga Q&A
  • 22. References Reports •Zynga Annual Report 2011 •Zynga Q4/2012 Earnings Slides •PWC Global entertainment and media outlook 2012-2016 •NCSoft IR Report Nov 2012 Web Articles •http://www.businessinsider.com/zynga-shuts-baltimore-new-york-austin-mckinney-offices-2013-2 •http://www.reddit.com/r/IAmA/comments/pc6j9/iama_former_fulltime_zynga_engineer_quit_6_months/ •http://techcrunch.com/2012/10/23/zynga-layoffs/ •http://www.cultofandroid.com/20765/zynga-announces-petville-mafia-wars-2-and-nine-other-games-are-to-close/ •http://www.businessinsider.com/most-profitable-games-app-annie-2013-2?op=1 •http://mashable.com/2012/02/01/zynga-facebook-revenue/ •http://www.businessweek.com/magazine/zyngas-quest-for-bigspending-whales-07072011.html •http://news.cnet.com/8301-13506_3-57343062-17/zynga-may-have-a-great-ipo-but-beyond-that-look-out •http://www.businessinsider.com/why-mobile-gaming-companies-are-anything-but-screwed-2012-12 •http://www.businessinsider.com/this-is-zyngas-next-billion-dollar-opportunity-2012-1 •http://www.bloomberg.com/news/2012-12-06/zynga-files-with-nevada-for-real-money-online-gaming-in-u-s-1-.html •http://blogs.wsj.com/digits/2012/11/13/line-asias-answer-to-whatsapp/ •http://en.wikipedia.org/wiki/History_of_video_games •http://en.wikipedia.org/wiki/PC_game •http://en.wikipedia.org/wiki/History_of_online_games •http://en.wikipedia.org/wiki/History_of_massively_multiplayer_online_games

Notes de l'éditeur

  1. References:http://www.businessinsider.com/zynga-shuts-baltimore-new-york-austin-mckinney-offices-2013-2http://www.reddit.com/r/IAmA/comments/pc6j9/iama_former_fulltime_zynga_engineer_quit_6_months/http://techcrunch.com/2012/10/23/zynga-layoffs/http://www.cultofandroid.com/20765/zynga-announces-petville-mafia-wars-2-and-nine-other-games-are-to-close/http://www.businessinsider.com/most-profitable-games-app-annie-2013-2?op=1
  2. References:http://mashable.com/2012/02/01/zynga-facebook-revenue/http://www.businessweek.com/magazine/zyngas-quest-for-bigspending-whales-07072011.htmlhttp://news.cnet.com/8301-13506_3-57343062-17/zynga-may-have-a-great-ipo-but-beyond-that-look-out/
  3. References:http://www.businessinsider.com/why-mobile-gaming-companies-are-anything-but-screwed-2012-12http://www.businessinsider.com/this-is-zyngas-next-billion-dollar-opportunity-2012-1http://www.bloomberg.com/news/2012-12-06/zynga-files-with-nevada-for-real-money-online-gaming-in-u-s-1-.html
  4. References:PWC Global entertainment and media outlook 2012-2016NCSoft IR Report Nov 2012