In this guide, I’ll propose you a way of how to develop a strong business model, conduct a competitive analysis, and combine the insights from both to develop a solid strategy for your indie game studio. Whether you’re seeking investment or competing in a pitch competition, a well-developed business model and competitive analysis will give you a strong foundation for success.
Understanding the Business Model
Understanding your business model is crucial for the success of your game. A business model is the blueprint for how your game will generate revenue and profits. It outlines your value proposition, target customer, revenue streams, and cost structure.
Your game value proposition is the unique benefit or solution that your game offers to your target customer. In the gaming industry, this could be a unique gameplay experience, a specific genre or theme, or a particular feature that sets your game apart from others. Understanding your value proposition is essential for creating a strong marketing message and positioning your game in the market.
Note: The term “value proposition” is often used in the context of developing a business model, while the term “unique selling point” (USP) is more commonly used in the context of marketing and sales.
Next, you’ll need to identify your target customer. This includes understanding the demographic and psychographic characteristics of the gamers who will be most interested in your game. Knowing your target customer will help you develop a marketing strategy that resonates with them and makes it easier to reach them.
Some popular revenue streams include pay-to-play (one-time purchase), in-game purchases, subscriptions, and advertising. It’s important to consider which revenue streams will be most effective for your game and how they will impact your cost structure.
Your cost structure includes the costs of developing, marketing, and distributing your game. Development costs include the cost of creating the game, while marketing costs include the cost of promoting it. Platform fees are the costs associated with distributing your game on different platforms. Understanding your cost structure will help you create realistic financial projections and determine your investment needs.
When developing your business model, it’s important to consider how you will price and monetize your game to maximize revenue. It’s also essential to consider different platforms and their revenue potential. As the market and competition evolves, it’s important to adapt your business model accordingly. This may involve testing and iteration to find the best approach.
Now, I suggest to take in note the terms value proposition, target customer, revenue streams, and cost structure, and find/determine your own ones. Usually, one or two sentences for each should be enough.
Conducting a Competitive Analysis
Before launching your indie game, it’s important to conduct a competitive analysis to understand the market and the competition. A competitive analysis allows you to identify the strengths and weaknesses of your competitors, as well as opportunities for your own game.
Using VGInsights, you can conduct a thorough competitive analysis for your indie game. Here is a step-by-step guide on how to do it:
Step 1: Conduct initial research on the market as a whole for your specific genre and size using VGInsights. This will give you an overview of the market size, trends, and potential target audience.
Step 2: Identify 4-5 recent competitor games in the same genre and size as your game. Analyze their gameplay mechanics and their unique selling proposition (what makes each of them unique?).
Step 3: Conduct a detailed analysis for each competitor game using VGInsights or a similar platform. It should include the game duration, price, reception/rating, marketing strategy, languages, and platforms.
Step 4: Analyze revenue for each game and compare it with your projected revenue to get a better understanding of the market potential.
Step 5: Based on all the information gathered, explain what is your game’s unique value proposition. Highlight the unique features and gameplay mechanics that set your game apart from the competition.
By conducting a competitive analysis, you can create a sales projection for your game that is based on realistic market data. This will help you determine your investment needs and make informed decisions about your game’s development, marketing, and distribution. Remember that, it’s important to keep your competitive analysis up to date as the market and competition evolves.
Combining Business Model and Competitive Analysis
The insights gained from your business model and competitive analysis will help you to create your game’s pitch deck. This deck should showcase your game’s unique value proposition, target customer, revenue streams, and projected sales, as well as the market size, trends, and competition. A pitch deck is a crucial tool for communicating your game’s potential to investors and other stakeholders.
The combination of your business model and competitive analysis also forms the foundation of your business plan. A business plan is a comprehensive document that outlines your overall strategy, goals, and how you plan to achieve them. By including the insights from your business model and competitive analysis, you can create a plan that is based on realistic market data and positions your studio and your following games for success. However, a business plan is not always essential, especially for indie game developers launching their first game. In this case, I’d suggest going first with a pitch deck.
Conclusion
I hope this guide has provided you with the tools and information needed to develop a strong business model, conduct a competitive analysis, and create a solid strategy for your game launch and development.
For a more in-depth look into complementary subject matter, I recommend reading “Game Marketing Plan – Stand Out in a Crowded Marketplace.” This article will assist you in constructing a comprehensive marketing plan, helping you to better grasp your target audience, competitors, and various marketing techniques.