Parks Associates Sees Social Gaming on Track to Become $5 Billion Industry by 2015

Virtual goods and new advertising revenues to drive market growth

DALLAS--(BUSINESS WIRE)--Parks Associates forecasts revenues in the social gaming market will increase by five times from 2010 to 2015, due in large part to advertising revenues and sales of virtual items. These factors already pushed revenues over $1 billion in 2010, according to the international research firm, which will present research from the new report Social Gaming: Market Updates at the Game Investment Conference (GIC) in Austin, Texas, on April 13.

“Gaming on social networks has quickly become the most visible category of online games”

“Gaming on social networks has quickly become the most visible category of online games," said Pietro Macchiarella, Research Analyst, Parks Associates. "Right now more than 250 million people play games like Zynga's CityVille and FarmVille on Facebook every month, and both game developers and marketers have taken notice. Big brands such as McDonald’s and 7-Eleven have carried out cross-promotions with existing social games.”

Macchiarella adds the social gaming industry has improved user monetization. While early entrants often missed revenue opportunities, new gameplay innovations incentivize players to buy virtual items such as virtual tractors, seed, or rare swords to build status, improve the gaming experience, or gain a competitive edge.

“The most powerful asset of social game developers is the quantity of behavioral data that they can obtain from their games," Macchiarella said. "The abilities to measure the efficacy of different gameplay mechanisms, to tweak game design in near-real time, and to test new models are advantages that traditional gaming companies will never have. Zynga’s huge market share is the best proof of the competitive advantage made possible by properly leveraging consumer data."

Advertising innovations such as branded games, sponsored items, communities, and "advertainment" that enhance, rather than interrupt, a gamer’s experience will also generate new sources of revenues for game publishers.

Macchiarella will present “Social Games” on Wednesday, April 13, at the Game Investment Conference (GIC), following AMD's Game On! Texas 2011 event on April 12. The session provides a detailed overview of the social gaming space, including market drivers and inhibitors, a competitive analysis, and an investigation of current monetization and payment methods.

Social Gaming: Market Updates focuses on the growing importance of social gaming. It analyzes the industry, market dynamics, and business models and provides revenue forecasts and analysis on monetization opportunities. For more information, visit www.parksassociates.com or contact [e-mail], 972-490-1113.

About Parks Associates

Parks Associates is an internationally recognized market research and consulting company specializing in emerging consumer technology products and services. Founded in 1986, Parks Associates creates research capital for companies ranging from Fortune 500 to small start-ups through market reports, primary studies, consumer research, custom research, workshops, executive conferences, and annual service subscriptions.

Each year, Parks Associates hosts executive thought leadership conferences CONNECTIONS™, with support from the Consumer Electronics Association (CEA)®; CONNECTIONS™ Europe; and Smart Energy Summit.

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