Don’t Take Risks
Wait. What? This gaming exec argues that there’s a big distinction between ‘smart risks’ and plain old risks. Avoid the latter.
By Jill Schneiderman (VP of Games, SGN)
Is she kidding? Yes, I am. Sort of. We’re always told that without great risk, there is no great reward. I believe in taking risks. Big, fat enormous risks. However, I think the more useful advice would be: without smart risk, there is a much smaller chance at great reward. What is smart risk?
When I first joined SGN (MindJolt at the time), it was just a few days after the acquisition. I left my family, friends and home in New York City practically overnight and moved to San Francisco, where I knew exactly no one, to work for a brand new startup company in a brand new startup industry. Everyone kept telling me how brave I was to take such a big risk but nothing about my career decision was risky at all. It was all quite planned actually.
I knew that our CEO, Chris DeWolfe, was a visionary leader who founded MySpace and built it into a household name. I researched his partners and realized this was a team that had the know-how to do it again. Social and mobile gaming was in its infancy but I knew from my history working in board games and my study of social media, that these two proven concepts would marry to create something big. Uprooting my life to join SGN on the ground floor was a smart risk.
De-risking at SGN
Someone asked me recently what SGN’s strategy is for guaranteeing that we make the next Candy Crush. I thought this was a funny question. Guarantee? No one can guarantee a billion-dollar phenomenon. The more important question, and the one that we work tirelessly for every day, is: how can we de-risk the game development process to guarantee that we are in the position to make the next Candy Crush.
Every decision we make throughout the development and lifecycle of a game takes this question in mind. Pouring time and money into the development of a new title is inherently a risk, but we put ourselves in the best possible position with each big risk by making those risks smarter.
First, we green light games that we know our current audience will like, so that we can use internal cross-promotion to drive traffic to the new title, instead of having to start from scratch every time. We pay careful, detailed attention during the development process to ensuring that we’re building the experience our target audience really wants (As a side bar, it slays me that in an industry so focused on making games for women, there are so few women at the helm of product decision-making… it’s just bad business!)
We mitigate crazy upfront costs by putting lean teams on projects for relatively short production cycles. If, at launch, the game shows positive metrics, we add more resources to the title, and scale up from there.
We manage marketing risk by building, and paying close attention to, our internal analytics platform that allows us to segment by campaigns and users, calculate LTV based on cohort and then guarantee profitability by spending less per user than that cohort is worth on average.
The concept of “de-risking” permeates everything we do as a company and every choice I’ve made in my career. SGN (and Jill Schneiderman!) have taken big risks to get where we are and we will continue to do so. Risks are incredibly important and without taking them, it’s almost impossible to lead or even move forward. However, the idea that you should blindly take risks, cross your fingers and hope for a big reward is a gamble I’m not willing to take. I’ll always be at the track but I’ll be betting on the smart horse every time.
Do you ever confuse smart risks with plain old risks?
About the guest blogger: Jill Schneiderman is the VP of Games for SGN (Social Gaming Network), overseeing and leading all of the company’s game production, from concept through life cycle. She began her career at Imagination Games. At SGN, she began her tenure managing business development and securing licensed content.
Photo credit: en-shahdi via Flickr.