Two things happened in the past 48 hrs that got me re-thinking games that consumers would spend money on :
1) 2 months into our social game, in walked my colleague, an online advertising expert with over 10 years exposure helping brands get their products sold in the real world, asking, “Why would anyone play social games with all those clicks and buy virtual items?”
2) A tiny article in Thursday’s Mint that Henkel was pulling out of India after a failed attempt at emulating the Hindustan Unilever success story in India.
( OK, I lied : there is a third reason : my hand was aching after my 1 week clickfest on games like Ravenwood and CityVille ).
Who sells to consumers the best, and how do they do it?
Distribution touch points
Once you have strong distribution in place in a country, or network, it’s difficult to get displaced.
Competitiors to your business need to move in in different ways.
Lets see how Walmart does.
Variety is the spice of life
Unilever sells four product lines – personal care, fabric care, desserts and spreads.
Within each, there are sometimes 10s of combinations within one product. Toothpastes that are green, red and even with dots in them.
Variety makes the shopping experience fun / a challenge / even a ‘game’.
People buy what they think they need
Use any toothpaste you want, but garlic or simply poor dental hygiene won’t help.
People purchase because they believe they need to, or are sold a product.
And purchasing is not about losing money you earned, but about getting something instead of earning it. And it’s an overwhelming feeling to do so.
The necessities have volume, but may not be the value proposition
Of the 4 product groups Unilever sell, like most people you’d believe the personal care goods sell the most. They do, volume-wise.
However, greatest value (revenues) come from the spreads business, a non-essential.
Looking at Sara Lee, a company more focused on foods, but broad in their breadth (also being sold this year), actually has their tea and beverages business being a more valuable acquisition than their breads business.
The necessities may bring you the volumes, but you can upsell or leverage that distribution, to other types of goods.
Analyze, everything
From studying behaviour patterns when users taste a new cola, to what colour packaging works best, to which aisle should we place the toothpaste at. Everything is measured.
This requires large teams of analytics teams and, honestly, it does require some owl type head figure to make sense of the holistic numbers, but alot of it comes from tedious and meticulous collection of data, and applying micro-knowledge about the product at the time of testing – e.g. a twitch in a consumer’s eye as they looked at a colour.
But be prepared to dispose
As part of Unilever’s Path to Growth strategy, acquisitions and consolidation was the norm. Identifying products that don’t work, cutting losses and moving on, was part of their strategy to growth.
No matter the amount of analysis one does, the product may just not find favour with consumers.
It’s a difficult decision to cut a product short, but Unilever does it in brick-and-mortar businesses, and Zynga does it, launching games understanding they are disposable.
Taking on Unilever?
There’s a lot of best practices that needs to be followed, but it’s a race that’s already won. Attempting to make a mark is going to require a paradigm shift, so much so that Unilever may be interested in acquiring you! (Unilever’s strategy is to acquire…)
I can’t share an immediate solution to the click-fest in today’s social games, but I do believe I have a Job Descriptor to prepare!
