Adapting to the changing games market: a Zynga spotlight

Every company will experience a slump at some point in their history. Platforms change. Demographics shift. The world moves forward. The trick is to find your footing and adapt to the changes.

Zynga is no different. They’ve had their ups and downs, but they’ve found a way to jump the hurdles set out in front of them. They learnt their lessons and changed up their model. It’s a journey that many studios might find themselves on, so we thought we’d dive into what they did and how they came out the other side as one of the most successful mobile gaming companies in the world.

Zynga’s story started well

In 2007, Mark Pincus founded Zynga. They launched their first game on Facebook: Zynga Poker. It was a huge success that set the stage for Zynga. The funding flowed in, they developed more titles on Facebook, like FarmVille, Mafia Wars and Cafe World, and they became one of the fastest-growing internet companies ever. A viral hit.

As it was well over a decade ago, you might not be familiar with the fervour that surrounded Zynga games. So let’s put it in perspective. CityVille managed to hit 26 million daily users in just 12 days. Five of their games were making $1 million a day. And, at their peak, they had 300 million monthly active users.

They were a big deal. And this was before they even went public.

Then the trouble began

In 2012, Facebook changed how their navigation worked. They began prioritising newer apps, and older games slipped down the list into obscurity. Over the next couple of years, Zynga lost nearly half its quarterly revenue – dropping from $322 million a quarter to $153 million in 2014.

This was, of course, rather a shock. They stayed like this for around four years as they began to acquire a few studios and switch from making Facebook to mobile games.

The skyrocket back to the top

In 2015, Zynga hired Frank Gibeau as their CEO. It took a few years to get the ball rolling, but over time they shifted their business over to mobile development. Then, in 2021, they’d smashed $720 million a quarter.

Speaking with The Big Interview in 2019, Gibeau explained the struggle they’d had. They’d acquired companies, but had the wrong incentive schemes for hitting targets. They’d not structured these studios very well.

“Investors didn’t trust us with their money,” Gibeau said. “It seemed like kind of a mess … a lot of clean-up-in-aisle-three kind of stuff.”

But with Gibeau’s interventions, they were back on top with games like Empires & Puzzles, Toy Blast and FarmVille 3 in their portfolio. But how did they get there? What had spurred their resurgence?

How did they do it?

A huge key to their success was through their acquisitions. They’d bought many creative and productive studios. Clearly, sorting out their structure went a long way towards their success.

But we’ve seen that there are essentially four elements that have helped their resurgence.

1. Acquisitions: Get in good talent

Over the next few years, Zynga acquired six notable studios. With these acquisitions, they were able to add games like Merge Dragons!, Golf Rival and Toon Blast to their portfolio. But they didn’t just focus on studios, they also bought companies like Chartboost, a monetization platform.

“We’re going to continue to be on offence [looking for] great companies, great cultures, great teams that we can bring into Zynga,” Gibeau told TechCrunch in 2021. “When we started, nobody was picking up our phone calls. Now, when we call, we are a bit of a destination of choice for a lot of developers out there.”

Getting in the right talent and finding those hits has gone a long way to helping their success. And those acquisitions came at exactly the right time. The changes to Apple’s privacy policies could have really hurt Zynga, but because they were bringing all these studios together, they could share data across their portfolio. The changes were actually a good opportunity for them.

It’s a lesson even smaller studios can learn from. The more you can combine resources and join forces with other studios, the more you can both benefit.

2. Partnerships: Developing popular IPs

There are plenty of games that Zynga produces that are their own IP. But they don’t shy away from teaming up with popular brands, either. They have titles like Harry Potter: Puzzles & Spells, Wizard of Oz Magic Match, and Game of Throne Slots Casino.

From a design perspective, these games are all varied and conquer territory that the original IP could never have entered on their own. Harry Potter: Puzzles & Spells earnt around $135 million by 2021.

“We’re combining some big licences with existing franchises that will grow the company,” Gibeau said, according to PocketGamer in 2018. “They will be familiar, but with new ways to play. They’re mobile from the ground up and will mix proven, better and new features.”

This is clearly a key part of their strategy, on top of acquisitions. And it’s advice that all studios should look to follow. Even if the loyalties do affect your margins.

“Licences are really efficient at enabling you to build a global audience quickly, and they also have great staying power,” Gibeau added. “Yes, there might be some pushback on gross margins, but they also lower your risk.”

3. Social elements: Let people play together

When you look through the list of games Zynga owns, it’s clear that social is still at its core. Not surprising, considering they started by making Facebook games. But you can still see that trend in titles like Words with Friends 2, Bluff Plus, and Tiny Royale.

Zynga’s general manager in Turkey, Buğra Koç, spoke to PocketGamer about Bluff Plus specifically. And it was clear that social was a core part of the experience for them.

“One of the game’s biggest features is its enriched, online social experience that was crucial to enhancing multiplayer gameplay,” he said. “It was very important for us to implement strong social mechanics to the game as well as smooth and fun gameplay.”

It’s a similar story with almost all their games. And it isn’t just in the core mechanics; they are constantly adding other ways to make their games more social. For example, they’ve added guild-like clubs into games like Words with Friends 2 and Harry Potter: Puzzles & Spells. They even released ReVamp, the first multiplayer social deception game for Snapchat.

4. Updates: Keep the content regular

The large part of Zynga’s revenue comes from in-app purchases and currency. Not unusual for a mobile game publisher, but that means that they need to keep releasing content for their games.

They focus a lot on keeping a game alive, rather than simply moving on to the next project. They call these ‘forever franchises’ – and they’re key for the company.

But how do you keep those franchises alive forever? Content. That’s why they’ve done in-game events that tie into movie releases or are linked to social movements like Pride Month. The latest of these is a partnership with Lucasfilm Games to release new characters and maps for Star Wars: Hunters, which is coming to the Switch and mobile later this year.

Another way they keep releasing new content and games is to run regular hackathons. These encourage developers to come up with new ideas and prototypes in as little as four days. Often, those ideas can end up being incorporated into their other titles or could get spun out into their own games.

Bring it all together

Looking at Zynga’s success, it’s clear that we can all learn from them. When the going was tough, they stuck it out and adapted their model. They focus on bringing in the best developers, teaming up with popular brands, making sure their games are as social as possible, and regularly releasing content.

These are all tips and tricks that any studio should look to replicate. Perhaps not on the scale of Zynga. But partnerships, social mechanics, and content are all areas that are achievable – even small scale.

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