Game industry veteran and current Xbox head at Microsoft Don Mattrick will be taking over from outgoing Zynga CEO Mark Pincus on July 8.
He inherits a company that has been plagued by poor acquisitions, falling stock (boost from Mattrick's appointment notwithstanding), layoffs, a falling user base, the failure to foresee that social gaming was heading to mobile, and a creative nadir consisting of clones and tired gameplay.
Mattrick's first order of business should be starting the massive pivot of transitioning the company away from creating gaming content and towards distributing it and managing it.
This isn't a revelation, but through its inability to innovate and cater to the maturing tastes of its user base, Zynga has proven themselves to be a game company with a major creative block. Depending on who you ask, it might not even be a game company, as former Zynga vice president in charge of its data-analysis team Ken Rudin once said, "We're an analytics company masquerading as a games company." After all, it's never been a secret that Zynga's design process is intensely data-driven compared to traditional game companies.
It is however, great at running a platform and marketing, as evidenced by a strong user base and capitalization of its first-mover advantage on Facebook during the early days of mainstream social games. This has real value that should be bottled and made the company's focus.
Ditch the "Fast Follow" ethos that previously drove the company and dictated such massive growth. To do so, it needs to reduce overhead by reducing game development staff as they move away from creating content.
With fewer employees focused on content creation, cut back on the number of games in the development pipeline, and leverage pre-existing IP. Titles such as Farmville have huge cachet with the mainstream, but they need fresh gameplay with a re-envisioning in order for Zynga to truly leverage its strongest IP for mobile and the second era of social games. Mark Pincus said the recent layoffs would give Zynga's teams the financial runway they needed. However they also need creative runway, to innovate away from the "click, wait, collect" gameplay that has become synonymous with Zynga titles from being repackaged again and again. That Cityville 2 didn't even last six months before being shut down this spring is damning evidence that mainstream social game players have moved on to more involved gameplay mechanics. There are talented, experienced developers at the company, no doubt looking to unleash their pent-up creativity—they just need to be given a little trust.
Rather than acquiring studios at a torrid pace and espousing a policy of Borg-like assimilation (EA saw backlash for a similar strategy in the 1990s), Zynga should focus on partnering up with smaller studios, and get indie developers wanting to work with them, rather than inviting widespread scorn. This isn't merely an act of goodwill, as it will bring better games to Zynga's doorstep, and reduce financial risk during a transition period in mobile/social by letting true game companies chart Zynga's path in social games 2.0 and the emerging mid-core demographic. To Zynga's credit, it is releasing games that are outside of their traditional catalogue of genres such as Solstice Arena, however its developer A Bit Lucky was purchased by Zynga last year.
In partnering with independent studios, Zynga absolutely should leverage its tremendous backend and experience with analytics and promotions—assistance in these areas would be highly desirable for indie developers, allowing them to focus on the gameplay and pushing out new games while Zynga manages live titles on their platform in exchange for revenue share. Such "Powered by Zynga" partner games could open up the company to new B2B opportunities.
If Zynga can't creatively break through, it can hunt down titles and license them for rebranding similar to what Rovio did with Amazing Alex and Disney with Temple Run: Brave. Or it can bring in outside developers to work with these IPs from scratch, introducing new, contemporary takes. For example, take the Empires and Allies IP, mix in Clash of Clans-style gameplay, and a bit of innovation.
It should also invest more heavily in new business development to maximize opportunities in merchandising, as highlighted by the success of Angry Birds and Skylanders. Rovio reported that 45% of its revenue in 2012 came from consumer products. If Zynga's properties don't skew young enough, it will need to develop new IPs with a focus on rich worlds and characterization that have greater appeal to younger players and merchandising potential.
Lastly, a new logo—considering the mud the Zynga name has been dragged through of late, a fresh start on the branding side would signal a new era to both investors and an industry that has enjoyed a certain amount of schadenfreude in witnessing the company's troubles.
Whether Don Mattrick can turn things around remains to be seen, but sweeping changes are a certainty if the company is to become viable again.
[Image: Flickr user William Grootonk]