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Our Konvoy weekly newsletter explores trending themes in the video game industry alongside the evolving landscape of venture capital. Delve into unique and insightful perspectives critical for staying informed in gaming and investment.

Understanding Gamers

The future of analytics within gaming will be driven by tools that help developers understand their audiences in a deeper way

The Future of Game Analytics

As the gaming market becomes increasingly competitive, a developer’s ability to understand their player base is more important than ever. Historically, video game analytics offerings have primarily attempted to provide these insights in the form of pure quantitative engagement data (number of installs, retention over time, etc). These are undoubtedly important metrics to track and will always be key to understanding the status of a given game, but they do not necessarily lead to strategic success. They are surface level performance insights that help a developer quantify the reception of a project, but do not help them deeply understand how or why it is being received that way.

We believe the future of analytics within gaming will inform more proactive and prescriptive development. These tools will need to be far more powerful than A/B testing and traditional cohort analysis. Rather than answering “what has happened?” we will see the importance of deeply understanding users’ actions and motivations.

This will be paramount for the development of successful games over the coming years. This is particularly true due to the prominence of live operations (LiveOps) and the increasingly popular games-as-a-service (GaaS) model. For context on scale, it is estimated that roughly $79b will be spent on free-to-play mobile games in 2022 (~40% of total gaming revenue). In this structure, success is not simply determined by the ability to sell a game, but rather to grow and maintain an engaged audience.

In the gaming market today, it is increasingly hard to stand out. While this may seem like a challenge driven by content saturation, it is actually the result of a multi-decade shift (upwards) in what it means to be best-in-class within gaming. Since the beginning of the industry, technological innovation has been critical to creating the most compelling experiences. After all, this is how we transitioned from simple 2D games such as Pong and The Oregon Trail to immersive 3D experiences such as Skyrim, GTA V, and Fortnite. The innovators that drove this progress are still some of the largest gaming companies in the world.

However, as the technical barriers to entry fall, success will not be sustained solely by building and operating superior development tools, but rather by leveraging those tools in a way that resonates with the right audience. This is not a novel concept, as game adoption has always been driven by strong product-market fit. That being said, we believe that tools taking the guesswork out of this process will become industry standards. Much like Epic Games and Unity have made development easier and more powerful, these analytics and audience understanding tools will be the foundation for finding and sustaining product-market fit.

Consider these three examples:

  • What is a user doing in-game and why are they doing this?: We recently announced our investment in Cognitive3D ($2.5m raise), a company that is aiming to answer this through spatial analytics in 3D virtual environments.
  • Who are my target users and how can we create and iterate games in a way that matches their needs and expectations?: Our portfolio company Solsten is building tools that enable developers to understand their audience and build products that are aligned with their psychographic profiles.
  • How are changes to the game impacting player experience?: Modl.ai is changing the way game testing is conducted through AI bots that provide awareness of bugs and how a user interacts with games.

In the end, this means better products that are built with the end user in mind and adapt to their needs over time. As huge fans of video games, we are excited for this next phase of advanced audience-driven development.

Takeaway: the future of analytics within gaming will be driven by tools that help developers understand their audiences in a deeper way. This can be achieved through analysis of in-game activity and understanding players themselves, and will ultimately help developers build and adapt their products more efficiently and effectively. We believe these tools will eventually be industry standards that are necessary to keep up with a rapidly evolving market.

Understanding Gamers

The future of analytics within gaming will be driven by tools that help developers understand their audiences in a deeper way

Welcome to Game Changers, the podcast that takes you beyond the games and into the heart of the gaming industry's future. Brought to you by Konvoy, a Denver-based venture capital firm investing in the platforms and technologies at the frontier of gaming. This podcast is your backstage pass to the pioneers, innovators, and visionaries who are redefining how we play and experience these virtual worlds.

In each episode, your hosts—Josh Chapman, Jason Chapman, and Jackson Vaughan, the founders of Konvoy — invite you to join them for candid and open conversations with the industry's most influential leaders. These guests are the “Game Changers”, the masterminds behind the scenes who've built remarkable enterprises and continue to push the boundaries of what's possible for our industry.

Whether you're a gamer, a tech enthusiast, or a startup aficionado, the Game Changers podcast offers valuable insights, inspiring stories, and exclusive access to the minds shaping the future of the gaming industry. Join us as we explore who these Game Changers are, what they've built, and what they're doing now.

Are you ready to level up your understanding of the gaming industry? Subscribe now to "Game Changers" and embark on a journey that goes beyond the screen to uncover the stories behind the gaming world.