From Frenzy to Fad: Why Pokémon GO Couldn't Keep 'Em All

Apple reignited the AR (augmented reality) craze earlier this summer with the release of the Vision Pro during its annual keynote. But AR isn’t just bulky goggles and flashing lights – one of the first AR fads started in 2016 with Pokémon GO (was it really that long ago???).

However, the key word here is “fads.” One of the most common challenges we see retail and ecommerce businesses experience is their inability to sustain their initial momentum. I mentioned this idea very briefly at the end of our Glossier case study, but in that case, Glossier lost its reputation due to bad HR and internal operational decision-making. More often than not, though, brands cannot maintain their brand image or awareness because of rigid, inflexible marketing strategies.

That’s why we’re going to dive deep into Pokémon GO and how it went from having over 200m active players at its peak to there now only being 80m remaining.

Ingress: The Origin Story

The team behind Pokémon GO originated from Google and one of its special project teams called Niantic Labs. Niantic Labs was created for the purpose of exploring “ubiquitous computing,” which included AR. The first project the lab launched was Field Trip, a mobile app that enabled users to view information about nearby landmarks.

Field Trip became the foundation for Ingress, the first AR game that Niantic Labs launched in 2013. The goal behind Ingress was to have players, who were split between two teams, capture “portals” that corresponded to real-life locations, such as stores, monuments, etc. The idea behind the game started with Google veteran John Hanke, who wanted to bridge the gap between the outdoors and gaming.

To everyone’s surprise, Ingress was a huge hit. At one point, the game had over 13m active players! Not only was it a great incentive to get users outside of their homes and moving, but it also gained traction for its social component – players had the ability to socialize and strategize with others who were a part of the same faction. Given its rising popularity, Ingress expanded globally, and it eventually caught the attention of Tsunekazu Ishihara, the CEO of the Pokémon Company.

Pokémon GO!

If you don’t know what Pokémon is, I swear you didn’t have a childhood (please tell me you’ve at least heard of Pikachu).

TLDR; Pokémon, or Pocket Monsters, is a video game released in 1995 that follows the adventures of a young boy who travels the world to collect and train monsters (Pokémon) to become the ultimate Pokémon master.

Funny enough, the idea behind Pokémon GO did not originate from either Hanke or Ishihara, neither of whom knew each other at this point. It started with Tatsuo Nomura, a Google Maps software engineer who played a prank on the Google Maps app. He did a little tinkering and edited the app so that Pokémon would randomly appear on the map. Google Map users could also catch the Pokémon by clicking on them. Google Maps users were quite amused, and those who also played Ingress suggested a potential collaboration with Pokémon on social forums.

Well, since the customer is usually right, Hanke flew to Tokyo. The thing was, Ishihara and his team were already prepared for the collaboration before Hanke even met up with them.

In 2015, Niantic Labs spun off from Google and became Niantic, Inc. Hanke advocated for the spin-off because he wanted Pokémon GO to be available on other mobile ecosystems, such as Android and the Apple Store. Besides, Niantic Labs was reaching the end of its three-year term, and if the team had remained, they would have merged with Google’s Android Mobile division, and Pokémon GO would have only been accessible for Android users.

In the summer of 2016, Niantic, Inc., and the Pokémon Company launched Pokémon GO and began rolling it out in different regions. Pokémon GO was first launched in Australia and New Zealand with no issues. Next was North America, and the team was waiting expectantly to see turnout.

What they didn’t expect to see was their servers crashing from the sheer overwhelming number of players trying to get onto the game. No one expected the game to be this popular, since no marketing or advertising was done prior to its launch.

In its first two weeks of launch, Pokémon GO garnered over $250m in revenue and set a new record as the fastest game to surpass $500m by its 60th day. Pokémon GO also peaked at 232m active players.

The reasons behind the game’s success is quite straightforward:

1. Pokémon already had an established fanbase, especially among millennials - who would pass the chance to experience some childhood nostalgia?
2. Because the game was built on top of Ingress’ infrastructure, the Niantic team could quickly build the game and save costs that were otherwise non-negotiable for other game developers.

Pokémon GO’s traction can only be boiled down to the first point, though. But the question here is: is nostalgia and branding enough to keep a brand going?

Backlash and Burnout

In order to answer that question, we need to look at the challenges Pokémon GO faced post-launch.

First, the game itself needed iteration. Pokémons could appear anywhere, and that included people’s homes, in the middle of the street, and other less ideal places. As players began to invest more of their time, energy, and money into the game, they also began to do anything to collect Pokémon, including risking their own safety.

But players didn’t stop there – which leads to my second point. The players who also happened to be programming nerds began to hack into the game so they could obtain rare Pokémon. For instance, Reddit groups were able to access the raw game data and leaked the locations of where certain Pokémons were located.

Obviously for the game developers, this wasn’t good news, so Niantic responded shortly afterwards by banning all third-party access to data.

This was definitely a very difficult decision to make. After all, these cheating strategies defeated one of the main purposes of the game – to collect Pokémon that you randomly come across. But at the same time, these “shortcuts” enabled players to rank up and interact with the game in ways that weren’t constrained by physical limitations. In fact, millions of players quit Pokémon GO after the ban because the game became too repetitive and boring.

So to answer our earlier question: No, the initial things that may have attracted your customers might not be enough to keep them around.

Players initially were drawn to Pokémon GO to relive childhood nostalgia, but as they became accustomed to the game mechanics, that want was satiated and there was no longer an incentive for users to keep playing. Now, there are only 80m active players – a substantial drop from the game’s peak in 2016.

Mitigation Strategies

Obviously, Pokémon GO has solidified itself as a legendary, record-breaking game. But its phase is over, and only the most loyal of the Pokémon fanbase continue to play it today.

So let this be an important lesson to all of us: DON’T SLACK OFF ON CUSTOMER RETENTION!!

Pokémon GO got lucky with having such massive traction at the start without doing any marketing. More than likely, you don’t have the same opportunities and resources to get your business off to the same booming start, and that’s totally fine because guess what - Pokémon GO still fell off despite the head-start.

Marketing is not only necessary to getting your brand off the ground but also sustaining it. In order to maintain steady growth, though, your marketing tactics have to change, and the smartest way to do so is by adjusting them to your customers’ behaviors and needs. Dig deep and discover the core of what your customers want, and then sell it to them! Cotera plays an especially integral role in figuring out what exactly your customers are looking for. Using the existing customer data that you have, we can organize and analyze it to find even the smallest hint of a pattern. Using our analyses, we can continue to help you determine the best ways to sell to your customers – such as through personalized suggestions, relevant emails and discounts, and the list goes on and on!

We know just as well as you do that building a business is all about playing the long game. Not only do you want to retain your customers, but you also want to save some stamina, and with Cotera’s capabilities, we’re here to save you a good chunk of time, money, and energy.

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