Virality is dead, and other gaming insights from the Casual Connect conference

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In the past, there were three pillars of Facebook gaming success. The first, virality, would require launching a game, engaging a core group of players, and making it easy to pass the game to friends, who in turn passed it to their friends. The next step was cross-promotion. “Hey, x-ville gamer, try this on for size and we’ll give you some free credits!” The third stage was monetizing the game through revenue derived from Facebook advertising.

A simple business plan for social gaming relying on the virality principle is now dead on arrival. The clear winner of social gaming 1.0 is Zynga. Now there’s so much noise that building a viral success is nearly impossible.

New gaming successes rely on branding and marketing strategies

To gain success today, gaming companies have to invest in marketing. In the saturated American and European markets, companies need to treat Facebook as not just a hub that houses content for friends and fans, but as a way to attract eyeballs while maintaining users. That’s easier said than done, and necessitates being both well-funded and smart.

Finding room to grow

So, what’s untapped in this rapidly maturing marketplace?

Well, overseas markets, for one. Asia is fertile ground. Japan’s mobile users are used to paying for content. It’s dominated by three social networks—Dena, Gree and Mixi . Like Japan, China is a vast market familiar with freemium models, yet its users are mostly PC-based. Korea, a land of hardcore gamers hooked on downloadable games, is starting to adopt social gaming, but is suited for midcore gaming, not the “x-ville” kind of stuff. It should be noted that gaming is now largely categorized by soft, mid and hardcore (Softcore gamers are defined as casual users that spend time on Facebook, or mobile devices. Mid and hardcore gamers usually own several devices and frequently play more competitive games on multi-player systems.) Brazil is hugely social, and while Orkut is the dominant network, Facebook is making a major push. India may be the biggest growth market. No dominant player or format has captured the loyalty of its large population, which is both social and techy.

Healthy gaming has the potential to fascinate users. Lumosity offers brain games. None of these are “great” games, but the site tracks results and maps your brain function, identifying areas that excel and those that need development. A company called Basis has developed a wristwatch that monitors the heart and uploads data to the cloud, which is accessible 24/7. Users learn where or when they become stressed and ways to improve your heart health.

Beating the next level

As the social gaming world continues to mature at a fast pace, the best way to intelligently position your video game brand is evolving. New marketing strategies in social media will continue to develop as marketers attempt to gain loyal users. The gaming sector will continue to grow, driven by emerging new segments and increasingly essential distribution of content through gaming platforms. It’s definitely an exciting time in the social gaming world, as competitors worldwide battle new business challenges, and have fun trying to win the game.

Peter Damon is vice president of business development for the Siegel+Gale Los Angeles office.

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