ANGRY BIRDS FLYING HIGH

Launching of game on Facebook seen as a huge step forward

Last week, Finish firm Rovio Entertainment, the creator of the world's most popular mobile game - Angry Birds - launched the game on the Facebook platform. Henri Holm, senior vice president of Rovio Asia, visited Thailand and spoke to The Nation. He said the presence of Angry Birds on one of the most popular social network platforms like Facebook will help the company reach its goal of engaging a billion fans in two years and also assist the company in gaining more revenue from game monetisation.

What is the strategy behind the current success? And what lies ahead?

The company is based on face engagement. We engage fans from around the world. They are both boys and girls of all ages. We offer them a wide platform to address our fans base. Our strategy is very simple. It is about engaging fans, keeping them, and connecting to Angry Birds entertainment game, short animation, movies, and comics. The devices you can use to connect to the family entertainment of Rovio include television, home PC, laptop, tablet, smart phone, and upcoming feature phones. So, our strategy is to woo and keep fans with different types of screens, whether it is the screen in the home living room or the screen of a device like a tablet.

How about the monetisation?

The second piece of our operation is to manage the brand. How does the brand look and feel? And how we provide it to the fans, and then monetise the brand, not monetise the fans. Brand monetisation gives us the scope for merchandise, licence and brand sponsorship. Some things give us revenue from outside rather than directly from the fans. So, what is important is the game. The game itself is the product or experience. It is very important for us. IT is a part of the story's detail. It is an experience we offer the fans. It is a way to communicate with the fans. Now, we can sell the game or we can give the game free of charge with advertising. Adverting revenue is growing rapidly. Our inventory is over 10 billion ad impressions a month. And the value of that is the prime property, cost per click, CPM rates. Our business growth is based on all forms, connecting the fans to the game. Merchandise is growing to retail value 10- fold year-on-year from 2011 to 2012. And advertising revenue is increasing in terms of absolute revenue. Currently, we have more than 700 million downloads globally.

The company has three main core businesses. They are game, entertainment - short animation and television commercial - and merchandise licensing branded sponsorship, and retail. They are three strong revenue streams for us. We don't break down the revenue portions. But the growth of each comes from the growth of downloads that goes back to the game business unit. But the two biggest reasons are the merchandise and the game as of today.

We have launched on a new platform - Facebook - since February 14. On the Facebook platform, it is a different revenue stream as it is about in-app purchase. But the game itself is free. With the large and strong engagement on Facebook, it will help the company entice a lot more fans to the game. The company also believes that its revenue from the game will be increased strongly with the in-app purchase. The company will use the payment system of Facebook as the other game providers.

Which is the largest market for Angry Birds? And what about the Asia market?

The US is the largest market. Look at the retail value of our business last year alone, when we introduced a number of new products into the market: game and play at Amazon.com online sales for example - the top seller is Angry Birds. We also received the toy awards as the Oscar for the best property of the year. It is a very strong indicator of the demand for the brand and demand for the products as long as we can satisfy the fans.

In Asia, our goal is to engage 1 billion connected fans. Asia is a major part of our market. This is because mathematically, Asia has the biggest portion of population. So, it is very important place for us.

At the same time, looking at the same growth and rules of business do not necessary apply in Asia as in America. So, we need to be able to find more localisation of the branding. That's why we have local partners here. In Thailand, we have MCN and Pacific Licensing. They are our strong partners to mobilise the brand in advertising and licensing.

Is reaching Facebook a big step forward for Angry Birds?

On Facebook the game is played free and it is very social. First of all, we can now reach fans whom we had not been able to reach before. From now on, they do not need to carry an iPad, just access with your Facebook account. They can download and play the game for free. They can play and connect to their friends throughout Facebook, and also connect to the latest story of Angry Birds. It is a major step for us to get closer to the fans, and to get our fans to connect to the brand. From a business perspective, it is a big step for us to monetise the game and increase brand value. But more important, it is about reaching the fans.

Our ambition is connectivity of 1 billion fans. We refresh the content every 3 to 5 weeks. We try to add new stories and features to keep the fans connected. Social networks make it possible to reach a larger group of people.

At Rovio, a company founded by young people, the company's chief operation officers are 28-29 years old. The company is very young in terms of how we perceive the market that we can find new ways of doing business. We developed a total of 51 games during 2003 to 2009. We took 8 months to develop the Angry Birds game. The game itself started from a very simple character. Our strategy is to make it simple. With a simple character, we have a story to tell. Each character in the game has a personality.