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In-app Merchandising in the di...- Mudit Khurana, CEO, Rucept
Merchandising has been used since the time of Walt Disney to monetize content consumers. Mickey Mouse is one of the first and top highest-grossing media franchises of all time. It is valued at over $75 bn and $65 bn + comes from its Merchandise sales.
There’s no big win for any content creator, and it should be so especially for Video games. Today video games industry is bigger than movies. The average gamer’s age is 38. 2/3rds of America and almost half the world plays video games, and an average gamer spends 10 hours+ playing games, which is way higher than the time a moviegoer spends watching movies. And yet, if you quickly search 25 highest-grossing franchises of all time, especially with high merchandising revenues, there’s only one video game - Mario.
Being a gamer, I’ve always craved for more game swag. When I tried to dig into the reasons, I realized that the only reason gaming studios prefer digital and direct monetization over merchandising is that they’re more comfortable doing so. Merchandising can be complicated. It involves offline operations, upfront inventory costs, and it’s not for everyone. Only large franchises have traditionally been able to implement a successful merchandising strategy.
However, this is only relevant in a world without internet and robot factories and 3D printing. In-game merchandising solutions can make the traditional merchandising supply chains and PoS obsolete, creating an entirely new way of making and selling swag that is direct and digital. Just the way gaming studios would like it to be.
Content and commerce are increasingly merging, and I believe in-game merchandising is just a start to a much larger trend of online-offline integration for video games and all sorts of content. As lines between virtual and real disappear with the advent of AR/VR, we will see engagement loops where the online activity will encourage offline and vice versa, and merchandise will be a key catalyst in creating that bridge.