Wednesday, August 29, 2007

Your boutique teeters atop a pyramid

Think of the video game market, or better yet any market as a pyramid.

This pyramid is also a graph, its a 3-D graph made up of golden blocks. Also it's made of people. Soylent Pyramid is people.

As you go higher, the amount of money that a single person is willing to spend goes up. The man sitting at the top of the pyramid has lots of money to spend on frivolous things that he doesn't need, but that he wants.

As you go lower the base widens on this pyramid, because there are lots more people here being crushed under the weight of those above them. These people on the bottom are willing to spend less, because thats how our X axis of this 3-D graph works.

So this market has a large amount of consumers who are willing to spend little to nothing, and a few who are willing to spend a lot.

Skill Games is at the top of the video game market pyramid. There are very few consumers of it, and its very hard to reach them and say "Here I am, waiting for you to come spend yer money at my magical pyramid of gold."

So Skill Games get smart and say "Where is there a surplus of people, and how can I trick them in to using us?" or to put it another way "How can I make money off the rest of this goddamn pyramid cause the pointy bit at the end is one guy, and I need a few thousand."

So Skill Games tend to be casual. Casual games have a large market, and attract people easily. Who can't sit down and play Tetris for a half hour? Ok my grandpa can't, but he is dead so he is excused.

Skill City on the other hand is sending its thick ropey tendrils all over this pyramid. We have avatars and experience systems that attempt to go after the dress-up crowd, casual games to pull in the inexperienced larger mass of gamers, competitive titles that grasp the serious gamer who values a good fight, all of this wrapped around subscription models that give you just a little bit more if you are willing to pay, and doesn't feel like it hurts those who aren't.

Will it work? Who knows... that's what we are finding out. So far it looks pretty sexy though, and now all I need is that million dollar budget to advertise it to everybody.

I think that means its time for me to talk about going after investment money, because unless your daddy is rich you gotta get that money from somewhere. Its the money that helps you make the leap from startup to success. Lots of people use it, lots of people need it.

Even I need it. I'm contact every VC, Angel, and Equity Investment firm on the planet right now.

It's a weird experience, once that I am hip deep in and wading through as one crosses a murky swamp filled with things unknown.

I am eager to share these experiences with you, so that you don't get bitten by the same snakes I am. I'll even leave little signs on the trees as I pass them, marking the way for those who come after me.

No comments: