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Yashash Agarwal, co-founder, and CEO of the gaming company Gamezop talks in an interview about his industry as a whole and specifically what Gamezop is doing in it
1. Within this dynamic industry, what distinguishes Gamezop?
Gamezop is a mobile gaming business that operates very unconventionally to get customers – we incorporate our games into common apps rather than forcing device installs. We have reached over 165 Mn unique users in this way, at zero marketing budget!
Although games with Android and iOS require installation, games with HTML5 function inside other apps with one single tap. Choosing HTML5, Gamezop piggybacks on partner apps distribution network which adds us to their apps as a gaming button. This way, Gamezop serves as a touchpoint for any partner user. Gamezop has at least two touchpoints on 97 percent of smartphones in India. By the end of 2020, we’re seeing this rise to ten touchpoints per unit.
It’s a lean model: we’re not making the games (we’ve licensed 250 games from third-party developers) so we don’t have to spend money to get users out.
2. What is the user experience strategy with Gamezop on apps?
Each feature, whatever it does, has two primary goals: interaction and monetization. Adding both of these Gamezop addresses for App developers. It raises the total interaction time on them by 15-40 percent as our games operate inside other devices. Second, those devices share the money we generate from games.
Leading apps have found interest in us in e-commerce, media, web surfing, travel, and usefulness, bringing our total number of partners to 800. Gaming is a key feature for all of them on their products, powered by Gamezop.
3. Why were you considering moving to an HTML 5 platform as well?
If every video needed installation, the consumption of videos wouldn’t have gone through the roof. Public belief is that mobile gaming is booming but software deployment latency is still throttling games. Imagine the growth we’re going to see if games could be played like photos, with one tap and no update. That’s where gaming’s full potential lies and it’s only possible with HTML5.
4. How does the Indian market view Gamezop right now?
India is our biggest sector, with 85% of our MAUs of 15 Mn. When one controls such a broad user base, one has the potential to add several types of games. One such format we recently launched is real money-based esports, where users play with each other and win cash prizes. Needless to say, in a market like India, this was a roaring success.
We will continue to be opportunistic in adding game formats as our user base expands at the back of our partner devices. This way we want to give our partner users the freedom to select the format they want to implement – free ad monetization games, real money-based esports, subscriptions, etc. – and share a portion of the revenue with them.
5. How have your investments in gaming grown over time?
We started as an app that allowed users to play multiple games in a social setup. Users liked the concept but we didn’t think the cost of driving device installs was fair at all. It was then that the advantages of HTML5 started to dawn on us. Instead of moving downloads from our device, we could be the gaming button on another device with HTML5 games which would make the company far more elegant.
The early days, of course, have been difficult. Gaming on HTML5 was in its infancy in 2016 and the games we recruited from developers were practically unplayable in Indian market conditions, i.e. the combination of weak browsers, bad handsets, and patchy internet.
We have built proprietary tools throughout our journey to re-engineer each game we add to our catalog to make it perfect for the harshest environments. On the other hand, we worked closely with leading mobile companies and browsers worldwide to ensure delivery-level success in the game. Given the laser-focused emphasis on HTML5 gaming, the optimization phase at the game as well as the distribution stage took us years to make it scalable. There are such high entry barriers that those who are looking to work with HTML5 games turn to us rather than reinvent the wheel.
6. Which are the features exclusive to Gamezop?
The geometrical growth of Gamezop to 15 Mn MAUs is a product of our robust 800-app partner network. — time Gamezop is added by a partner, we see an increase in user numbers, at no cost from our end. Other players in gaming need to drive their apps at a high cost to the consumers, while Gamezop can piggyback on its partner apps ‘network.
The uniqueness of our model enables us to be highly successful in a competitive environment and also opens a further source of monetization for our partner apps. Last financial year we closed with EBITDA of 45 percent.
Essentially, we’re a gaming business that doesn’t have to produce games (because we’re licensing them from other developers) and don’t need to get customers!
7. Can you give Gamezop some insight into the size of the market as well as the competitive landscape?
The online gaming market in India is expected to generate USD 1 billion by 2021, with 310 Mn gamers, according to a frequently cited KPMG-Google survey. Of course, those figures include gaming in all verticals. At the moment Gamezop operates in two categories: hyper-casual mobile gaming and real money-based esports.
Our unit economics is much better in both models, and particularly in esports, than in competition. We don’t have any expenses to acquire users because of our piggybacking model, but we can monetize them from day one, making us highly profitable.
Our competitors drive APK side installs in the esports space which is incredibly costly and leads to high alarming burn rates. The economic units in the APK side-install model are useless for esports; there is too much reliance on continuous fundraising.
With such a high burn pattern we’d never be happy with having seen scale for a while now. Our concern is not that of GMV but that of profitability.
8. What had improved between 2016 and today at Gamezop?
A lot of things at Gamezop improved from 2016 to now. We not only existed as an app back in the day, we even created the games in-house. Neither aspect of that was scalable.
Turning to the cloud has allowed us to create a robust business model: sourcing and integrating games from third-party developers at multiple touchpoints. We now have 250 games of high quality and 800 touchpoints!
It’s important to remember that Gamezop only has 15.2 Mn users by being present on 1 percent of Indian developers released apps. There is a lot of space there to grow.
This model will be limited to India alone; 15 percent of our users are already outside India. The aim is to create a pattern that can be repeated: go to different markets, work with local developers there and put games on them. Whether it’s casual gaming, real money gaming, subscriptions or in-game purchases, we’ll be opportunistic about the formats implemented in every industry.
Visit www.gamezop.com on your mobile browser to start!