Market Overview

Zynga "Appeals to the Same Psychology as Gambling," Says Analytics Expert Jeff Tseng

Share:

It looks like casinos may have finally met their match.

When users log into Facebook each day, they don't think that they are entering a gambling arena. When they jump into FarmVille, they don't see it as a virtual slot machine. But ask Jeff Tseng, the co-founder and CEO of user analytics firm Kontagent, and he will tell you that casino gambling and Zynga gaming aren't all that different.

“It's not gambling, but it's a similar mechanic,” Tseng told Benzinga this week. “I think it appeals to the same psychology as gambling does.”

Tseng, whose company specializes in the analytics of social and mobile gaming, said that he feels that Zynga is really good at including elements that hook people. “A lot of times people say that their games aren't really fun, they're just more addicting,” he said. “I think that's a large part of what has made them so successful.”

But that's not the only reason why Zynga succeeds. “If you ask any of their exec guys, they'll tell you that Zynga is an analytics company with kind of a game company wrapped around it,” Tseng continued. “They run their businesses off of spreadsheets, so they are very sophisticated with how they do customer acquisition, how they are able to cross-promote between applications, how much they're able to monetize off of their users.”

On the flip side, Tseng sees PopCap – one of Kontagent's largest customers – as a studio with a different strategy.

“PopCap is a pretty unique company in that they're one of the few studios out there that [is] very focused on gameplay and user experience,” Tseng said. “If you look at what they did with Bejeweled Blitz, which was their first big Facebook game…they spent a lot of time really tweaking and tuning each individual power-up in the game.”

Tseng is also impressed with PopCap's social media strategy. “A lot of games [from other developers] spam your friend stream,” he said. “[PopCap is] very conscious about the user experience. They never rush anything. They always tweak and tune that a lot, so what EA (NASDAQ: ERTS) got [in the acquisition] was really deep experience in building really good games.”

With regard to Electronic Arts' decision to acquire PopCap, Tseng notes the firm's domestic and worldwide expansion as being a huge benefit. “They have a pretty good presence on Facebook,” he said of the Bejeweled maker. “They've started branching into other areas as well. They've released some games in China. They're also getting pretty aggressive on the mobile side of things. You even see their games now at Best Buy (NYSE: BBY), [such as] Plants vs. Zombies. So they're really broadening out their distribution, whereas before they were really just a download distribution platform.”

In addition to PopCap, Kontagent's clients include 2K Games (NASDAQ: TTWO), Konami (NYSE: KNM), CBS (NYSE: CBS), THQ (NASDAQ: THQI), Ubisoft and Digital Chocolate.

“We have a pretty big list of customers we work with,” Tseng said. “We work with developers. We help them with their user acquisition, their user retention, engagement, and monetization metrics. We provide different metrics around how they're doing in those respects, and then some actionable data in terms of what they can do to optimize around it.”

Follow me @LouisBedigian

 

Related Articles (BBY + CBS)

View Comments and Join the Discussion!

Posted-In: 2K Games CBS Digital Chocolate EA electronic arts gambling KonamiTech Best of Benzinga