Why Companies Fail Chasing Trends

“Why innovate when you can replicate?” Might as well be the mantra of the gaming industry. Each time a product achieves success, it is either met with clones or sparks a trend in the industry that every company attempts to get on. Expecting equal or significant results despite a complete lack of innovation in their iteration of the trend or style.

Why does this fail? There are a couple of reasons, but before delving into the logistics, economics, and sciences, the first element worthy of mention is simple poor implementation combined with an abysmal understanding of what makes a product successful enough to become a trend. Take the tacked-on multiplayer trend that followed the success of Call of Duty during seventh gen. Nearly every game received what was typically an uninspired, at best, basic multiplayer addition that would usually die within a month of the game’s release.

None of these were made with any passion or direction. They were created to simply chase the trend of Call of Duty by executives and marketing teams with no understanding of what made Call of Duty work, and why that would not be happening with their game. Worse, these tacked-on additions often took away development time and, more importantly, budget, from the core single-player experience. Resulting in most cases in either a shorter or less refined product.

One does not need to be an analyst to determine why those games fail. A more modern-day comparison would be the countless survival-MMOs or Battle Royals that rise just to die within a year.

Now let’s look at the other elements of why these games fail.

Trends are short-lived, development is lengthy

While there exists three different types of trends: Short, Intermediary, and Long Term, most design trends fall into the short or intermediary categories. Short trends tend, in reference to games, be quarterly interests, Intermediary last a year or two, and long term are trends you’ll see survive throughout the decade.

For instance, open-world games are a long term trend. Their sales potential remains relatively stable, depending on the quality of the product. A short-lived trend would be something akin to the Neon fascination of 2019. Intermediary trends are akin to Battle Royal phenomena, which has been on regular decline for years.

A trend may last a decent amount of time, but it will have a peak. The problem for the industry is by the time companies and studios typically realize a trend is hot, it has already peaked. 2017 saw the height of Battle Royal with Fortnite generating $2.4 Billion. The development of many Battle Royal titles started around this time. As development takes between 2-5 years depending on the project, by the time these games have completed their development cycle, the trend is either waning, or it has by and large concluded.

Now there is an exception to this, and that is when a company revitalizes the trend with a fresh and innovative new product. This tends to extend the length of the trend, but isn’t going to happen for more generic entries into the trend.

Sunk Cost

In 2015 Steam Spy creator Sergey Galyonkin penned an analytical editorial titled: Your Target Audience Doesn’t Exist. The core premise was fairly straightforward. The marketing analytical premises behind decisions in the gaming industry were fundamentally flawed. Classifying gamers into female gamers, male gamers, or core gamers is inherently a flawed classification system.

Gamers are broken down among what their particular interests are, not by their identity. Even then, unless you can provide an innovative entry into a specific market, the sunk cost of time spent on existing properties and titles will keep the audiences on those titles. Meaning what companies are competing for is a fraction of a fraction of a market that is willing to give new title’s a try.

By merely copying existing trends, a company will not secure part of the market. Players will just return to the titles they have the most time and money invested into after a week or two.

The core message of the entire analysis is that rather than chase a trend or attempt to produce what appears to be appealing to a market, development should be focused on their own product. That ove-rgeneralization of a market is bad, and there is no guarantee that the market will even try, let alone adopt your product.

Misidentification of what the trend is

Many of you are familiar with the term “Get Woke, Go Broke,” but the driving mechanism why this trend has emerged is less discussed. Setting aside the obvious infiltration and subversion of companies, which remains a problem in its own right, the driving force behind this phenomenon is a misidentification of a generational trend.

Many companies who have been informed by their marketing teams believe the way to achieve high customer retention and acquisition among the millennial generation is to be socially conscious. Now, this is a timeless tactic to improve public perception of a business or businessman. When done right, it does inspire successful brand loyalty.

The problem facing many companies is they believe being woke is the same as being socially conscious. This is reinforced by social media to give a false barometer of how successful the campaign is. Only then for the quarterly earnings to show a massive downturn in sales resulting in losses. Infamous examples include Target’s CEO Brain Cornell running the once growing chain into the ground by pursuing woke politics as part of their statements. Gillette went from a declining brand to their parent company posting $8 Billion in losses following their anti-male advertisement.

In conclusion, companies continue to fail because they are chasing trends they will not be able to capitalize on even if they succeed in entering the tail of them. Worse for them, their obsession with false trends such as wokeness will continue to see many of them see diminishing returns or loss of reputation resulting in the same going forward.