Blog Games

Watch out Warzone and Fortnite: Ubisoft is coming after free-to-play

Cover image for Watch out Warzone and Fortnite: Ubisoft is coming after free-to-play

Photo: Sigmund

Photo of Karol Severin
by Karol Severin

Ubisoft announced last week that it is adding specific focus on free-to-play, alongside its AAA catalogue. In doing so, it is following a route that has been very successful for Activision with its Warzone strategy.

Free-to-play games which draw audiences via big franchise names and monetise via in-game spending are going to be increasingly common among AAA publishers. The focus on in-game spending and particularly on the cosmetic, rather than the progress-related, parts will be the key revenue component.

As games become less finite and more perpetual (consumer goal is less about ‘finishing them’ and more and ‘playing/spending time in them’), the opportunity to monetise needs that stem from this perpetual engagement (e.g. socialising or expression) starts to outweigh the mere monetisation of access to a packaged product.  Simultaneously, free-to-play games also act as a powerful marketing driver for AAA releases as they come out, as well as streamability and word of mouth for the franchise.

Ubisoft is well positioned to pursue the free-to-play strategy

Ubisoft’s favourable positioning for this strategy is driven by the combination of its franchise brand power, the behavioural make-up of its users and its distribution partnerships.

While it is not yet known which Ubisoft titles will get an increased free-to-play focus, let’s take an example of Assassin’s Creed, one of its flagship brands.

In Q1 2021, 9% of consumers in English-speaking markets were Assassin’s Creed (premium title) players, comparable to Fortnite’s (free title) self-reported player base of 10%. Furthermore, 15% of Assassin’s Creed players buy in-game items, compared to 18% of Fortnite players, and 14% of Call of Duty players.

Regarding the video and marketing opportunity, 32% of Assassin’s Creed players watch games-related videos every month, on par with Fortnite players and compared to 29% of Call of Duty players. 7% of them live-stream their own gameplay online every month, on par with Call of Duty players.

Thus, a compelling free-to-play proposition for Assassins’s Creed would have the potential to compete in the top echelons of free-to-play console/PC games.

Furthermore, there are significant overlaps between Ubisoft’s player base and players of big brand games, which are available for free. 62% of Assassin’s Creed players are also Call of Duty players – this means that CoD Warzone as a free proposition will speak to a majority of users of Ubisoft’s flagship franchise, which does not have a free proposition at the moment. Similarly, 32% of Assassin’s Creed players are Fortnite players. On one hand, deploying free-to-play titles for Ubisoft will mitigate cannibalisation by already established free-to-play competitors. In turn, it will also pose competitive pressures to those already established going forward.

Besides Assassin’s Creed, a number of other Ubisoft titles could go this way in the future. 4% of consumers play Far Cry, with 21% of those buying in-game items. Other brands which could be positioned well for this strategy include Tom Clancy’s titles, as well as Watchdogs.

In addition to engagement and revenue, expanding into free-to-play has a number of other benefits for Ubisoft:

-       It will be appreciated by game owners and non-owners alike, because all friends can now play (not just those that can afford to buy the game), creating stronger bonds and experiences between users and thus positive sentiment.

-       Free-to-play games and related promotions can be used to attract subscribers to Ubisoft+. Simultaneously, free-to-play games will stand out to users of partner services such as Stadia, where most games need to be purchased.

-       Free-to-play helps publishers capture additional hard drive share, which is a powerful competitive weapon in the attention economy.

Finally, by moving towards free-to-play where perpetual engagement, expression and in-game spending play key roles, Ubisoft positions itself well to engage in cross-entertainment partnerships through music, sports and video, in a way not dissimilar to Fortnite.

If successfully executed, and if the right overlaps and opportunities are pursued by Ubisoft, the free-to-play move is bound to unlock incremental revenue as well as users and engagement for the company.

The discussion around this post has not yet got started, be the first to add an opinion.

Trending

Comment on this post