The future of Angry Birds
While looking at photos of my exchange in Asia two years ago, I noticed something: the huge amounts of Angry Bird toys and t-shirts present in the background of my photos. I remembered us talking about the game, and how popular it had become in such a short time.
Angry Birds is a mobile game developed by Rovio Entertainment. Since the start of the game in 2009, the application has been downloaded over 2 billion times, with 263 million active users per month in 2012. After the initial success, Rovio started expanding the Angry Birds brand into areas such as toys and clothes. In March 2013 it even launched a streaming service with cartoons, which videos have been viewed over 3 billion times since then (The Guardian 2014).
Nowadays, about half of the income is generated by selling games, while the other half comes from the merchandise of Angry Birds products such as video’s and toys. Rovio is continuing to launch new versions of the game and cartoons, and even signed on for an Angry Bird movie.
However, when looking around these days, it can be noticed quite quickly that almost no one is playing Angry Birds anymore. This is consistent with Rovio’s press release of September, where it reported a loss of about 24% of its players: the number has lowered by 63 million to 200 million (The Guardian 2014). Even though this means Angry Birds is still one of the games on the market with the largest audience, it is a significant loss – it seems as if Angry Birds has passed its popularity peak.
In order to not rapidly slide down this slope, Rovio should consider its options for maintaining a strong brand image and keeping its revenues up.
In my opinion, there are 2 ways to take. At the moment Rovio has a split focus: both merchandise and the game are at the core of the strategy. The company could shift its focus to only one of those, thus emphasizing either the merchandise or the game.
Regarding the focus on merchandise, it seems a viable option. Angry Birds has become an established brand in several areas already: from clothes, to toys, to cartoons. With its cartoon being a great success, the chances of the promised movie becoming a hit seems highly likely. Rovio could leverage the strong brand image and popularity by expanding its merchandise into other areas, herewith increasing its revenues.
On the other hand, the focus could also be laid on the game itself. Rovio would have to continue innovation of the game by updating levels and launching new versions. However, other popular games such as Hay Day and Bejeweled have one major thing in common: they let users interact through platforms such as Facebook, hereby increasing the social component of the game. Angry Birds is a game purely played individually, which possibly might be a cause of the loss in gamers. Therefore, a higher level of social integration in the game could be a major factor in this strategy.
In the beginning of 2015 Rovio will get a new CEO: Pekka Rantala, previously marketing chief at Nokia. Will he know the answer on which direction to pursue? What do you believe to be the best strategy?