Achieving Success in the 2025 Gaming Industry: The Power of Data

Evgeniy Kurenkov, founder and CEO of Magify, an analytics and live-ops platform for game studios, emphasizes the significance of data-driven decision making in the gaming industry. Upon examining the top free-to-play games in any category, it becomes apparent that they are all developed by large, well-established studios with substantial marketing budgets, streamlined user acquisition systems, and extensive experience in player engagement. Notably, emerging studios are absent from this list, and while increasing user acquisition costs and limited access to scalable business intelligence tools are often cited as the primary reasons, Kurenkov argues that this is not the root cause. The high cost of user acquisition is a inherent aspect of the market, with larger studios continually increasing their user acquisition budgets, leaving smaller studios struggling to compete. The core issue lies in the lack of understanding of game economics and forecasting models, hindering the growth of new studios. In the current gaming market, a studio's competitive edge is derived from its ability to extract insights from data and utilize them to inform decision-making. Even experienced teams often struggle with resource allocation due to the absence of a robust analytics platform or the use of outdated systems that cannot support the elevated standards in analytics and live operations. Modern free-to-play game development is centered on metrics and maximizing user lifetime, operating as a high-tech industry that relies heavily on data. The mobile gaming economy is primarily concerned with striking a balance between customer acquisition cost and customer lifetime value. To achieve this balance, high-quality data, analytics, and live-ops tools are essential. Every stage of game development must be supported by A/B testing and data analysis, as the absence of a data-driven approach can result in wasted budgets. Decision-making without data is equivalent to guesswork, and in the gaming industry, understanding player behavior and preferences is crucial. Successful studios have adopted a data-driven approach, using forecasting models and live-ops planning to ensure player engagement and retention. In 2025, a successful game studio is not solely a content creator but also a systems operator, relying on personalization, hypothesis testing, and monetization strategies to drive success. Games have become an integral part of players' lives, and studios must adapt to this shift. The separation of analytics and live operations is no longer viable, as end-to-end tracking is necessary to comprehend the impact of in-game events and offers on player retention and revenue. While it is possible to develop a business intelligence system from scratch, this requires significant expertise and time, which are often in short supply. The emerging trend of automating live operations with machine learning and AI demands a new tech stack and talent that smaller studios may not possess. Moreover, internal business intelligence systems rarely contribute to a company's valuation as expected by founders. In the event of an acquisition, the acquirer typically uses its own business intelligence system, and the valuation of the acquired company's internal solution is excluded from the deal. However, a mature software-as-a-service ecosystem now offers top-tier analytics, attribution, and live-ops tools, enabling studios to focus on data-driven product management. The primary objective is to achieve a high return on ad spend, as cheap traffic is meaningless without understanding its performance. A key example illustrates this point: nearly identical games on app stores can have vastly different user acquisition numbers, with some attracting millions of new users monthly, while others plateau at less than 100K installs. The primary difference lies in the studios' ability to personalize the gameplay experience and monetize through segmentation and remote configurations. These controllable factors are what make a game appealing to a broad audience and enable direct engagement with players. Successful studios leverage these tools to their advantage, while others miss the opportunity, highlighting the importance of data-driven decision making in the gaming industry.