Snap Pushes Into Gaming, Ratcheting Up Battle Royale With ‘Fortnite’

Snapchat is joining other technology companies to attract users that use "Fortnite" and other popular multiplayer games by adding multiplayer games to the app. The first game added will be "Bitmoji Party" followed by other games developed by other partners such as Zygna Inc. Games are fun and people tend to spend a lot of time playing them.

Games have attracted a lot of attention and according to Netflix Inc., it competes and loses to "Fortnite" more than HBO. "Fortnite" was launched in mid 2017.  Nielsen's SuperData estimated that "Fortnite" has made more than $2.4 billion in revenue, mostly from sales of virtual goods. Fortnite's success has spilled over to other industries. Since the game requires gaming accessories, such as headsets, stores that sell them made a profit due to the popularity of the game. Facebook Inc. has more than 700 million people play, watch, or participate in gaming groups every month. On the other hand, on Amazon.com Inc.'s Twitch, people spend time watching live video gaming content.
In 2018, people spent $87.03 billion on in-game purchases. According to Newzoo, spending on smartphone and tablet games last year accounted for nearly half of the global game industry’s overall revenue of $134.9 billion.

For the past three quarters, Snapchat has shown no activity in user growth. Snapchat's Chief Executive, Evan Spiegel, said he doesn't expect Snapchat to be profitable in 2019. Gaming could provide a way for Snapchat to squeeze more money out of existing users even if Snapchat fails to sign up new users. Snapchat plans to convert its games with ads that users can watch to win virtual coins and other perks and it will not offer in app purchases.

Furthermore, Snapchat saw that "Fortnite” made a shift had in how people use video games as hangouts. Many games double as online hangouts, serving as virtual couches for players. Players often talk to one another during and in between matches through headsets, with some forming friendships along the way. Snapchat sees an opportunity in the thousands of games that are available for phones but that don’t make it easy for friends to play together.

I chose this article because I have been using Snapchat for a very long time now and it's interesting to see how the app has changed so much. The app already has games that I sometimes play with one other person but it will soon have multiplayer games.

This relates to marketing because it is a good way for social media platforms to promote that games (new products) will be added to the apps to increase the amount of time users use the app. This way users benefit by getting new games that will not make them bored and social media platforms get more users to spend time on their apps.



Source: Georgia Wells and Sarah E. Needleman April 4, 2019 5:02 p.m. ET
https://www.wsj.com/articles/snap-pushes-into-gaming-ratcheting-up-battle-royale-with-fortnite-11554402000