Green Man Gaming And The New Marketplace

In 1985, video games were a $100 million industry; that was after the great console crash that started in 1983 and drained 97 percent of the value of a once $3.2 billion marketplace. Though many predicted the end of home gaming with that crash, video games rebounded and by the early 1995, video games — mostly divided between consoles like Xbox, PlayStation, Wii or PC-based console games — were worth over $20 billion a year in revenue, a figure that had climbed to almost $50 billion in 2007.

Today, the gaming industry is worth between $88 billion and $100 billion per year in revenue, depending on whose stats on the subject one fancies. But it’s an industry that has seen its fundamentals shifted greatly since approaching the $50 billion mark eight years ago.

Up until that time, gaming had largely been driven by consoles and PC players who purchased expensive games on for their very advanced (and expensive) gaming gear (a console or PC) and played until the game was done, then went out and bought the next game. But once smartphones became par for the course, so did mobile gaming. Games that are free or cheap (a dollar or two) that don’t strive to be billion-dollar immersive epics, instead focusing on being simple, entertaining, addictive and likely to make gamers pay for small power-ups as play continues.

No doubt about it, that model that has been a roaring success. Game of War — a mobile game you’ve likely never heard of but probably remember Kate Upton advertising during the Super Bowl — is raking in over a million dollars a day in revenue. Game of War is free to download in various app stores, but players have been known to spend hundreds, thousands and even tens of thousands of dollars to keep up a 45-minute-a-day mobile gaming habit.

Of the nearly $100 billion in revenue up for grabs in personal gaming, more than half of it is flowing into mobile games, and many are predicting that model is the future of gaming, certain to replace the big game model on consoles and PCs.

But the good folks at Green Man Gaming don’t buy that the entire future of digital fun will be on a phone screen and think the prognosticators of doom about the future of console and PC games are perhaps calling time of death a little early.

“Is the market adjusting? Absolutely,” Green Man CEO and founder Paul Sulyok noted in a recent interview. “However, it has been obvious to us that the fundamentals of the market are there and I think our growth is evidence of that.”

And grown Green Man Gaming certainly has. Founded in 2010, the platform launched as a place where serious PC and console gamers could come and easily purchase their titles online — and at a discount. A business model fundamentally similar to the space’s resident power player, Steam, Green Man was a small David to Steam’s Goliath on launch day, with just over 500 titles from 26 publishers.

Today, Green Man Gaming is the second largest (behind Steam) video game eCommerce site on planet Earth. The British-based firm has over 5,000 titles with over 350 publishers worldwide, ranging from the large and known to tiny indies with only a few hundred players.

The marketplace aspect of the site is familiar — users can buy digital copies of their games — though Green Man Gaming’s special proprietary sauce allows them to disable a digital copy’s online activation code and resell it to a new user as a “pre-owned copy.” The original user is paid in site credit for their return game, which they can put toward new game downloads. Sulyok says that Green Man has really worked to disrupt a model where gamers would purchase expensive games and then deal with one of the few brick-and-mortar specialty shops in an area which might offer them change on the dollar for game buybacks.

Green Man isn’t offering cash incentives, he noted, but to their user base they offer something more valuable: access to the gaming products they want for a highly reduced cost.

“There is a desire for companies that can deliver on a global stage,” he said. “ECommerce is different from normal bricks-and-mortar companies where 97 percent of my energy would go into running shops, managing overheads, encouraging footfall. I have one shop, in Bloomsbury, selling to 185 countries in the world.”

And it is in building that global community organized around a common interest that Green Man has pegged its future ambitions. In 2012, Green Man acquired gaming social media site Playfire. The Playfire platform allows users to directly connect their Xbox Live, Steam or PlayStation accounts so that they can upload their stats, game review and play information for their friends in the community. The million-plus user platform provides a major boon to Green Man, which has several paths toward monetizing the very specific data streams that Playfire produces.

“Through this data we can get very, very targeted,” he says. “We know how long it takes how many gamers to finish a level, we know when someone is ready for a new game, or if we need to build a new map. We can sell an extra level, virtual food bag or more weapons. It is useless to us to send an offer for games to customers who aren’t ready, and annoying for them.”

Moreover, he notes, the data present a win-win for both Green Man and their users, because Green Man compensates them for the voluntary access to their data.

“By rewarding game play, we encourage gamers across the world to not just purchase games, but to play more of the games they love or discover new games. We track their in-game behavior and benefit from learning more about their gaming habits and style as they play,” Green Man notes on its website.

When Green Man started the first chorus of  consoles PCs were dead were warming up, and many were forecasting that users were only going to want to play Angry Birds. But Green Man has bet big in the opposite direction, that consumers still want that immersive experience – and are in fact looking for new ways to share it with others.

Because though games are for play time, distributing them to the masses is serious business.