Steam: Upping the game in 2020

The video game industry has flourished through 2020 and Steam has been a platform where a lot of that growth has happened.

Steam is a popular gaming platform that was launched by the Valve corporation in 2003. It enables gamers to buy video games online and download them directly as compared to going to a store or waiting for delivery of a physical copy. It also acts as s social network for PC gamers and allows them to track and share their progress, awards and tome on screen with other players around the world.

As seen in various online delivery-based services, Steam had a great year in 2020. People being confined to their homes needed something to do and steam was the perfect platform for them. Having access to the internet, a credit card and a capable PC is all it took to be able to access a global gaming community and keep busy during the multiple lockdowns and shelter in place orders around the world. The steam sales data shows this. (Valve 2021). This is a result of people having more time at home and needing to entertain themselves. The number of games purchased went up by 21.4% (Valve 2021) showing again that people not only wanted to play more but also wanted diversity in the games that they played. The number of monthly users also peaked in 2020 at 120.4 million and so did other KPIs like the number of concurrent users at 24.8 million, daily active users at 62.6 million and first-time purchasers at 2.6 million. (Valve 2021)

The Steam sales are an important part of their annual calendar and defining peaks of their sale cycle. The number of games that grossed over $100,000 in the winter sale went up by 36% as compared to the same in 2019. Steam did work on capitalizing on the increased amount of time that its users spent on the platform by making it easier to host specific sales and special events which developers used to showcase their work to customers as in person industry conferences were cancelled. To fill this gap they held “Game Festivals.” These festivals measured their success in demo activations, i.e, how many new video game demos were activated during this time. We see a stark rise of around 500% in demo activations between spring and summer. (Valve 2021)

Their community engagement also saw growth in the form of the introduction of the Steam Points program which is effectively a loyalty program where the points can be used by players for customizing their profiles and avatars to display their unique identity which is a major part of the online gaming community. The program saw 16 million players participating to redeem 99 million items from the store. They created the Points Shop developer tools to let game developers also create and sell content for steam points within their games too. This will expand the relevance of this loyalty program to outside just the steam store and hence made participating in it more lucrative for players. Using these points within their games would also help developers attract new players to their games.

Steam also saw a 30% increase in playtime on their Virtual Reality games and a 71% increase in revenues form VR, 39 of which came from one game(Half Life: Alyx) which is owned and developed by Valve. They observed 104 million PC VR sessions in 2020 and also expanded support on OpenXR which lets developers port their games to VR. It is particularly impressive to see these numbers as many experts tout VR to be the future of gaming and 2020 has been a year that is helping it take a stronger foothold hold in the gaming community (Valve 2021).

In 2021, steam plans to launch onshore in China and to further explore its rewards program to maintain and reward player loyalty. They are also exploring Linux gaming and trying to bring it to the main stream from the fringes.

From this we see that the gaming industry has done well during the pandemic and Steam and its community have grown together by supporting each other through 2020 and with changing work trends and the end of the pandemic still being a little distant with slow vaccinations, will continue to if 2020 is anything to go by. Steam is a perfect case of a product which was helped by the pandemic  as its product delivery was unaffected, order volumes kept growing and its community is in itself invested in its growth.

References

Valve. 2021. “Steam – 2020 Year in Review.” www.steampowered.com. January 13. Accessed February 8, 2021. https://store.steampowered.com/news/group/4145017/view/2961646623386540826.

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1 thought on “Steam: Upping the game in 2020

  1. What a great read! As you have noted, I strongly believe that “Steam Points program” was the main driver behind its increased community engagement. It is also interesting to note that they are also thinking about further expanding into China. China’s game streaming market is huge ($4.5B in 2020) but it is also extremely competitive. I noticed that in 2020, two local players, Huya and Douyu, have merged. Collectively, they now have control over 80% of the market. It would be interesting to understand how Stream is planning to enter this heavily fortified market.

    https://www.scoop.co.nz/stories/WO2010/S00184/chinas-game-streaming-market-to-generate-45b-revenue-in-2020-as-top-two-gaming-platforms-merge.htm

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