The core focus of the mini game overseas model is the global demand for lightweight gameplay, and domestic mid-waist manufacturers actively participate in it.
The Zhitong Finance App learned that CICC released a research report saying that the core focus of the mini game overseas model is the global demand for lightweight gameplay, and domestic mid-waist manufacturers are actively participating. The success of the mini game overseas model is driven by a combination of domestic industry catalysts, global preference trends, and competitive advantages of manufacturers. Furthermore, the team believes that going overseas for small games is expected to become a new market for domestic mid-waist game companies to explore in the field of overseas, expand the manufacturer's overseas regions and user profile, enhance R&D and operation capabilities, and accumulate experience to expand the radius of capabilities of mid-waist game manufacturers.
Mini-games have gone out to sea, and top quality products have sprung up, and mid-waist manufacturers are the main participants. “The Legend of the Mushroom Hero”, the leading product of the game in 2024, jumped to the top 3 in the Chinese mobile game revenue list; in addition, 37 Entertainment's “Little Monster Asks” and “The King's Guide” from Big Dream Dragon Road all performed well. CICC believes that the characteristics of overseas mini games are: 1) promoting lightweight gameplay that has been proven in the domestic market; 2) operating in the form of an app overseas, and the competitive logic differentiates from the domestic market. Compared with overseas, the core advantage of competing products lies in excellent lightweight gameplay; 3) domestic mid-waist manufacturers are the main participants.
Why is the Minigame Outbound Mode a success? Domestic industry catalysis, global preference trends, and competitive advantages of manufacturers are all driven together. CICC believes that the core catalyst is the rapid expansion of the domestic mini game market in 2023. More developers have entered the mini game circuit, and a number of excellent mini game products have emerged. However, the global market's preference for lightweight gameplay forms the basis for small games to go overseas. Low thresholds and positive feedback are the current gaming and entertainment demands of global users. From a competitive perspective, CICC believes that the current weak competition on lightweight game circuits leaves room for medium-sized manufacturers to gain revenue. At the same time, manufacturers have many years of overseas experience, which has accumulated in terms of overseas game purchases and localized operations, boosting the popularity of products after reuse into small games.
Focus on the effects of the mini game overseas model on increasing the size of a single product, and on improving the overseas ability and market development of medium-sized manufacturers. From a product perspective, CICC believes that first, it is expected that multi-regional superposition will be used to expand the distribution scale of individual products; secondly, considering that R&D costs are covered by domestic mini-game versions, it is expected that profit margin levels will rise slightly after going overseas. From a manufacturer's perspective, CICC believes that mini games have pioneered a new path/model of going overseas: using “import-localization-export” or “domestic native-export” gameplay, and operating based on purchasing volume and global localization. CICC believes that it is expected to expand the manufacturer's overseas regions and user base, enhance R&D and operation capabilities, and accumulate experience to expand the radius of capabilities of mid-waist game manufacturers.
Profit forecasting and valuation
Maintain profit forecasts and valuations for related companies. It is recommended to continue to pay attention to the development and new product situation of medium-sized manufacturers in the direction of lightweighting and integrated gameplay, and be optimistic about 37 Entertainment (small game product capability+overseas multi-regional distribution and operation capability), Kaiying Network (small game product capability+overseas distribution capacity), and Celadon Gaming (medium to mild integrated gameplay product power+overseas distribution capacity).
risks
Increased competition in the industry, changes in industry policies, exchange risks, and macroeconomic changes affect the ability and willingness of game users to pay.
