Guest post: How Zynga can turn its fate around in the next 6 months

[Editor’s note: The following article comes from CEO and founder of YetiZen Sana N Choudary. It suggests how Zynga can improve its position by improving its relationship with developers. YetiZen, is a cornerstone of the game development community that organizes the wildly popular San Francisco Game Developer’s Workshop series and runs the only games exclusive accelerator program. Recently YetiZen launched the YetiZen Innovation Lab, 20,000 square feet of a games community center in the heart of San Francisco which is focused on empowering all aspects of the games community. To learn more about the YetiZen Innovation Lab, its events and free coplay opportunities please visit http://yetizen.com/innovation-lab/]

Unless you have been living under a rock you have seen the doom and gloom stories of Zynga—low Wall Street confidence, falling stock price, demotion and resignation of major executives and the list goes on. Industry veterans say it’s because Zynga has been focusing on tactics and metrics rather than creativity and innovation. Game designers say the non-gamer turned gamers have finally realized Zynga is giving them glorified slot machines filled with clicking grinds and meaningless rewards and that just doesn’t cut it anymore.

Meanwhile, Zynga’s fast follows have become faster–new skins of games launched by other developers with higher production quality, fancier sounds and shorter times before the player hits a paywall. All its games are based on doing that which has helped them succeed in the past—a zealous focus on traffic arbitrage, retention and monetization and iterating based on the metrics that measure them.

It is this metrics drive that helped it win against Playdom and Playfish by establishing and maintaining the strongest customer acquisition strategic position. Unfortunately for Zynga this strategy only contributes to company growth when you are expanding the pie by adding new non-gamers into the gamer mix. Many thanks to Tadhg Kelly for his detailed post describing Zynga’s current state of affairs.

To continue to grow, a new strategic position must be found and a metrics only approach cannot help provide insight into what that would be. This is because the insights that metrics provide are limited to what they have been designed to measure. They never help you ask new qualitative questions that the data does not reflect and in the famous words of Einstein: “Not everything that counts can be measured. Not everything that can be measured counts.”

So how does Zynga find its new strategic position? After all they do have a large player base that believes and trusts in the Zynga brand to bring in new game experiences. The answer is the infusion to the company of new DNA primarily of developers who are focused on new game play innovation. To do this Zynga would have to do things very differently than what they are used to.

Invest in makers of innovative game franchises

Here is a list of Zynga’s acquisitions this year.

If you look closely at size of company, the number of games launched and their performance you will start seeing a trend. With the exception of one, all the acquisitions were talent acquisitions of teams bought in to scale up existing Zynga tech infrastructure. The one exception to this was OMGPOP, bought for Draw Something’s userbase as it was the same demo as Zynga’s existing mobile games.

None of these acquisitions were of studios bought for their ability to innovate on new ways to compete or make new types of games that meet underserved customer demos or unmet needs—the ingredients of truly innovative successful game IPs.

Those types of studios exist and despite the rocky investment climate for game studios* many of them have not only survived but thrived. They have passionate players playing the game for much longer lifetimes than the Zynga games (I have seen upwards of 9 month lifetimes in several games recently).