You have likely heard of the mobile game called Angry Birds. If you haven’t, you will. It is an addictive game that keeps many entertained for hours. Rovio is an entertainment company with Angry Birds being its staple product. It was formed by Niklas Hed, Jarno Vakevainen, and Kim Dikert, who were all Helsinki University of Technology students. The company had a rough patch to go through in 2015. Revenue came in at 142 Million (EUR), with an operating loss of 13 Million (EUR). According to the explanation on the website, investment in the Angry Bird’s movie took a hit on spending, but this was expected.
Again, according to the company’s website, even before the release of the movie, revenue has grown in the first half of 2016. It reported an improvement of about 10 Million (EUR) from the prior year. This is largely attributable to its gaming leg of the company.
Angry Birds is more than a game for the company. They have made it into a viable brand. It has expanded to movies as well as product lines. In fact, licensing is a big facet of the company.
How the Company Started
It started as a result of a contest won by the three Finnish college students (Hed, Vakevainen, and Dikert). The contest was for the development of a mobile game.
The game they developed was called King of the Cabbage World and was a multiplayer mobile game, one of the first of its kind. The team sold the game and used that success to obtain funding for a mobile app startup company which was later named Rovio.
Selling their contest-winning app gave confidence to angel investors and the three winning students were able to form the company based on that initial funding. Later, they used the proceeds from Angry Birds to expand the company even further. This led to more venture capital by major partners in 2011.
The company was little known and developed 51 games before releasing its 52nd, which was Angry Birds. While it was in development for Angry Birds, the company struggled financially and had trouble paying its bills. The company was approached by a former HP employee who came on as head of marketing and helped to get the company noticed.
In the meantime, Niklas Hed’s cousin, Mikael Hed, took over as CEO. Mikeal’s father took out a second mortgage to try and keep the company going. This cash infusion helped to finish the development of Angry Birds.
Why it Works
The company is a success due to its multichannel presence. It would be short-sighted for anyone to call them a video game developer. They are much more than that. They have a television show (ToonTV) and have made a movie based on the game.
It also has a division that allows other game programmers to launch their creations using the help of Rovio. The division is called Rovio Stars. They help both in development and publishing of the games.
The development of Angry Birds coincided with the release of Apple’s iPhone and the company saw a great opportunity to publish on this platform.
The game itself is in what is considered the Entertainment Snacking category, which means you can play during short breaks. However, people are more likely to continue playing once they get hooked. If you ask fans if they can put the game down after playing for a short duration, most will say only if they have to.
One huge factor that has led to the success of the game, and by extension, the company, is it made the game incredibly simple to play. Once you download it, you should be able to start playing the game within minutes. This doesn’t mean it’s easy to master, however. The company does continue to add levels of increasing difficulty.
Rovio pounced on the mobile arena, a place Nintendo refused to do until quite recently. It sold the app for 99 cents which made it cheap enough for most to download. At millions of downloads, it’s not difficult to see how successful this strategy was.
For players who didn’t want to spend the money, the company offered a free version that included advertising. This pulled in even more users who downloaded and played the addictive game.
The company has made the program available on other platforms as well, including Android. While iPhone still has the bulk of downloads, Android is catching up.
When colleagues or friends see someone playing the game, the player will likely recommend it. This increases the game’s word-of-mouth promotion. The game is enticing enough for unknown bystanders during morning commutes to inquire about it, which expands word-of-mouth promotions even further.
An Angry Birds movie was released in the summer of 2016. This is likely to reignite the game’s popularity along with any merchandise developed to be sold in conjunction with the movie’s release. The movie is appropriately named, The Angry Birds Movie and contains the voices of several well-known celebrities. Sean Penn, Jason Sudeikis, Maya Rudolph, and several others complete the voiceover lineup.
Licensing is a huge deal for the company. Anything from games to plush toys and action figures is part of the mix. LEGO has created six sets based on its licensing agreement with the company. It continually expands its licensing reach which helps to bring in new customers.
On the Google Play App store, the amount of 5-star reviews surpasses all of the lower-starred ratings combined. In fact, the number of 5-star ratings is just shy of triple that combined total.
Interestingly, on the iTunes platform, there is less enthusiasm among reviewers. It is still high, but not as robust. Some users complained that the game is impossible to play after a certain level. Others feel it’s too repetitive before you find any rewards to help you level up.
ThinkGaming.com’s Top Games category has Angry Birds 2 at number 36. While it is not the top spot, it still commands respectable revenue from this level. As mentioned, the game is not the only means for the company to generate revenue.
Lessons Learned By The Business
- Probably the biggest lesson the company learned was that it never anticipated Angry Birds would grow as popular as it did. When your industry is gaming, you have an expectation of who your target audience is. These are specific people who are diehard gaming advocates. However, when your app has broad appeal, across many demographics, you may not be ready for that growth.
- Because of a solid Angry Birds fan base, marketing successive versions requires finesse. Will they know your marketing efforts are for the future generation of the game or do you need to scale it back? The answer is probably somewhere in the middle.
- The company did not give up. Even though they were struggling before the release of Angry Birds, they kept pushing forward, and their efforts paid off.
How Other Businesses Can Learn From This
Be ready for anything and don’t make any assumptions. Try to formulate possible scenarios to account for instances that you may encounter. It won’t be easy to project, but the closer you get, the more you will be ready for growth.