I managed to grab Peter Vesterbacka for a few minutes at Slush today to talk about how Angry Birds sees the world after 500 million downloads. Basically, there’s a lot more out there for them to grab than one would expect – simply looking at them what they’ve done so far. Everyone knows that the company is looking to grow into an entertainment empire, but in my opinion they’re already there. They’re not just as big yet, even though they are.
I wanted to learn what the biggest growth platforms for Rovio at the moment are. Vesterbacka explained that the whole Nokia Asha partnership is just one part of taking Angry Birds to new markets. In addition to the Nokia partnership, Rovio has also partnered with Nokia’s biggest competitor in China to bring the brand to their users in a similar way (pre-installed on new devices).
Rovio hasn’t made a lot of noise about this partnership, but when I asked when will you see 100 million users in China through these partnerships Vesterbacka replied, “it’s pretty much happening as we speak – the sales are on going and we won’t need to wait for 12 months that’s for sure”.
So what about the animation business? On that front, Rovio is building a world class team to make weekly short format animations. In the beginning the animations will be short format and it seems like the company is looking to find the right time to make their own longer films, be it a movie or a proper 30-minute series. Internally, the company has a goal to reach 100 million views per episode.
The company is looking to build up the merchandise side of its business as well. At the moment they have 10+ million toys sold and expect this to grow very big in the coming months (because let’s face it – years isn’t exactly the right time frame to talk about the company).
Vesterbacka stated also that he expects the retail value of the merchandise business to grow into multiple billions of euros in the future. They’re also opening soon their first store in Helsinki, but more stores will open in China – Beijing and Shanghai for example. They’re looking to ramp this up dramatically in the future as well.
Rovio has also worked on Bad Piggy Bank in the background very actively. The company is also looking to announce in the coming days a partnership with a large US based operator (my money’s on AT&T). While many see Bad Piggy Bank as a way to sell additional things to players, I see Rovio building a completely new sales channel to sell more goods to people who might not have a chance to buy content from other channels. This would mainly be players in emerging markets.
Overall, it seems like key part of Rovio’s strategy in expanding their business is to first see where they can take it – be it merchandise, games, movies – whatever the area may be. After this, they lay down the plans to completely own the value chain, all the way from the creation of the content to the consumer. This way, no matter what happens to Angry Birds, they have a huge amount of direct connections, ie. sales channels, to consumers.
This pretty much opened my eyes to the potential of the company. Angry Birds is surely one hell of a brand at the moment, but I wouldn’t be surprised to see other brands come up in the future through their network of connections to their fans.
And for this reason, I believe Rovio will be so much more successful than traditional entertainment companies who have licensed their content to different channels instead of working the value chain themselves. The knowledge and direct feedback from fans is crucial in keeping things afloat in a hit oriented business. With Rovio’s conquer and command approach – they surely have a great shot at it.