Video game publishers used to spend hundreds of thousands of dollars per-title to get gamers' attention with flashy trailers and ad campaigns. Today, they're spending millions of dollars—sometimes at a loss—to throw massive events which are meant to bring gamers in their fan base a non-virtual place to convene, and maybe to bring newcomers into the fray. Is that really necessary?
One such event is BlizzCon 2011, which started Friday. For those of us who aren't among the 11.1 million-World of Warcraft (WoW) subscribers, or BlizzCon attendees, this is Blizzard Entertainment's annual conference in Anaheim, California where they announce new WoW expansions, or reveal new games like StarCraft 2: Heart of the Swarm or Diablo 3. The company loses money on the event, but Paul Sams, COO of Blizzard says it's worth it.
"[BlizzCon] started out as, and has continued to be, an opportunity for us to connect with our very passionate player community. We wanted to have a celebration of Blizzard games," Sams told FastCompany.com. For a video game company supporting one of the most profitable entertainment franchises in existence—WoW earns over $1 billion per year—it only makes sense to give back to the fans, he suggests. "We run BlizzCon at a financial loss...[but] we get to see to the passion in person, to hear the enthusiasm in the voice of the players."
Blizzard is not the only video game company doing such huge events. In September, Activision promoted their mammoth military franchise with a Call of Duty XP event. Activision's CEO Eric Hirschberg said, "We did everything from building levels of the game at actual size and using them as paintball stadiums, to recreating a level from Modern Warfare 2 as an obstacle course, and a jeep experience where you are riding with a professional driver, through a jeep obstacle course that looks like the game come to life, with mortal shells and gunfire going off all around you."
Much like Blizzard, Activision implemented a digital feed of content from its "IRL" or in-real-life fan experience. "It wasn't just an [event] for the 8,500 people who were there physically. Millions of people followed along online. We engaged millions of fans to give us their attention in a way that no traditional form of advertising could've delivered. The LiveStream video of the keynote presentation was the 2nd most viewed livestream ever," said Hirschberg. This was long-form content; not 30-second spot advertising.
Activision decided to take the revenue it made from the sales of $150 event tickets, and give it to a charity, the Call of Duty Endowment, that proivdes financial support to American troops and their families. With Call of Duty revenue exceeding $1 Billion per year, this good will only made sense.
Huge fan weekends are few, though. Much more common in the games industry are launch events on a smaller (but not too small) scale. Companies orchestrate midnight sales extravaganzas, with thousands of stores opening in the wee hours in order to allow players an opportunity to buy or play a new game from their favorite series, first.
Geoff Keighley, host of Spike's Game Trailers TV has covered many of these events for his show. Keighley said, "Thousands of fans line up at these stores to play these games for the first time. It's like the iPhone or iPad launch. The funny thing is that with the iPad launch there really are limited quantities, but if you want a copy of Gears of War 3 or Call of Duty you are probably going to get it. People line up to be part of this community and to say, 'I lined up to buy this game.'"
Typically, a games retailer partners with a publisher to have a special event at a flagship store. In September, Microsoft had its Gears of War 3 launch event at the Best Buy Theater in New York's Times Square. "Best Buy wants to give people more when it comes to gaming and entertainment, and what better way than to open our doors early so our customers can be among the first to play Gears of War 3," said Stacy Anderson, Best Buy's Senior Director of Entertainment Marketing.
Then, there are preview events. Earlier this week, Sony showed off its big holiday title Uncharted 3: Drake's Deception in AMC theaters in 5 cities across the U.S.: New York, Washington D.C., Dallas, San Francisco, and Los Angeles. Asad Qizilbash, Sony's Senior Manager Product Marketing, said, "An event like this provides a first to experience, first to play and first to own, consumer engagement opportunity. They get to experience never before seen content and share their passion for the franchise with other Uncharted fans."
For three nights in each of these sold out theaters, the company unveiled new aspects of Uncharted's single player and multiplayer modes, screening a new trailer, and raffling off game-related prizes. "We want to support the fans that decide to come out for things like this. We want to give them T-shirts, we want to give them prizes," said Ricky Cambier at the event, one of the game designers at Naughty Dog who created Uncharted 3. The preview event also did a good job of promoting PlayStation 3's 3-D capabilities, which dovetailed nicely with AMC's 3-D screens. Ryan Noonan, Director of Public Relations at AMC, said, "Playing a game like Uncharted 3, on the big screen in a huge auditorium with RealD 3-D technology at AMC Theatres is an opportunity guests can't get anywhere else."
The Uncharted preview event also featured a tournament for a wide variety of prizes, something most of these events usually have. Blizzcon, Gears..., Uncharted, and Call of Duty events all had competitions. Hirschberg said, "Thirty-two teams competed for $1 million in prizes, thousands of people crowded the stage to watch. It was a great spectator sport."
Gamers' events have other excessive commonalities. Many feature music acts: Kanye at Call of Duty XP, Big Sean at the Gears event, and Foo Fighters are playing at BlizzCon tomorrow.
They also dole out swag to non-competitors, and non-raffle-ticket holders. The freebies might be special downloads—BlizzCon distributed special virtual pets for WoW characters, and at Uncharted there was a code for unique clothing for avatars or characters to wear in Uncharted 3's multiplayer game.
Naughty Dog's co-president Evan Wells explained, "We are putting [events] on primarily for fans, and for them to get a chance to play the game early, or get the game early." Attendees at the Uncharted event who paid $60 per premium ticket were able to sign up to get a physical copy of the game shipped to them a week before it would become available to the general public.
What may be the most effective feature of these events is the appearance of the actual game creators. This is a big draw, compelling players to put money down on tickets for these events—"The most memorable thing that happened last BlizzCon was meeting some of the game developers. It was great to hang out and talk with the genius minds behind World of Warcraft," said Mary Wayne, BlizzCon attendee and a photographer from Virginia—this enthusiasm extends to developers themselves. Sams said, "It's an opportunity for us to recharge our geek batteries, to see players when we open the door to sprint full speed to the game they want to get their hands on. It is just such an incredible experience."
In the world of gamers, the game creators are celebrities, like auteurs to film students, or the Jonas Bros. to teenage girls. I had the privilege to interview the game creator Cliff Bleszinski at the Gears of War 3 event, and was interrupted by excited fans with their own questions.
It is all part of the excitement of these events. "There will be about 1,500 to 2,000 people here—but they're all going to be evangelists that are going to go out and play the game and gush to their friends." said Bleszinski. And more than the rush of being treated like a star, the events help inform them. "We get to hear, from their lips to our ears, what it is that they love and what it is that they don't. The good news about our players, is that they are willing to tell us both," said Sams about BlizzCon. Cambier said of the Uncharted event, "I am making mental notes of where they are shocked and where they are surprised, so we can remember that and carry it on to Uncharted 4."
Naughty Dog's Evan Wells said, "We have these online games that persist even beyond your first exposure to single player campaigns. People are just involved in your franchise over a longer period of time, they build up more enthusiasm for it. It's great to meet up with them and see them face to face."
The fans seem likewise thrilled about what they learn at these events. "I played the first two games and there were great. I want to see what Drake's new story is for part three," said Jose Coriano, a gamer at the Uncharted event. Another gamer, Alberto Arana, said, "The first two games, I've played them so many times. I want to see the improvements, to see if it is any different than one and two. To me it is the best gaming franchise out there. "
What is the real return on investment for game companies holding these big events?
Blizzard's Sams said, "It's a way of us to showcase and sometime even announce new content and new products. From our perspective, there is no better group to reward with the first look, first words on things that we are doing." More quantitative results for BlizzCon included 26,000 tickets that sold out only seconds after they went on sale. The ROI will also be the social media and news coverage brands receive around an event.
One only needs to look at Call of Duty XP's millions of streams and comments for evidence. Activision's Hirschberg said, "We were a global trending topic on Twitter, we got tens of millions of impressions on Facebook. There were countless articles that were generated and headlines created for the event itself, from everywhere from gaming press to Forbes magazine. It had a good return on investment as a marketing experiment."
All of this comes at a relatively low cost, even if the events aren't profitable in and of themselves. Michael Pachter, the Managing Director of Equity Research at Wedbush Securities said:
"In the context of 10 million plus unit sellers, a $1 million launch event is really small potatoes. Gears will do around $350 to $400 million, and Call of Duty well over $1 billion...Every company spends 12 to 15% of sales on marketing. It is not unreasonable for these companies to spend 3 to 5% of their overall marketing budget on a big event that attracts media attention. It's not clear to me that these events drive sales on their own, but they're important to overall branding."
One can see a parallel in Hollywood. Keighley wonders: "Do movies really need to have premieres? Would Pirates of the Caribbean do less business without a premiere at Disney Land? No. Would Gears of War 3 be a success without a launch event?"
If the benefits of these tournaments, conferences and other events are not reflected in the sales of the games, why do companies continue to push extravagant gaming events each year?
Blezinski also believes, "This is what it takes to launch a AAA game in 2011. Otherwise, you are just going to be a blip on the radar and no one is going to know you came out." Keighley agrees. "It is not enough to be highly-rated. You have to go to that next level and try to become this pop culture phenomenon," he said.