The year of the webstore has started - David Stelzer from Xsolla

[Music] We're now joined by David Stelza from Exola. How you doing today? Very good. Thank you for having me. I understand you had a panel earlier on that you were talking on. Uh I didn't speak, but we had two different panels today from two of our folks. Uh Sam Gaglani from our enterprise team gave a great panel talk with some of our customers around web shops and what's going on with them right now. Uh Chris Meredith gave a talk today. He runs our AMIA operations uh on the the myths and the the best practices around web shops right now. Gotcha. Now I think people can watch the previous video for the what is it Exola does. So we'll we'll sort of cut to the chase here. Um we were talking about back in London, you and I, the training gamers who are aren't used to using third party web stores. Since then, we've had the Apple versus Android ruling. So we're now allowing customers to push outside of iOS. The ward gardens coming down. Is this the era of the web store? Is this what's going to happen now? Yeah, I

think uh I think the era for the web store has already started. This continues to solidify and legitimize it more as we go. And it's not an all-in strategy at the moment because you have different rules for different places right now. It's a little fragmented. Uh one of the things that we're really working on in Exola is to help game makers and publishers better understand how to navigate within the different geos with the different products that are available. So, for instance, if you're in the United States, you have different things available to you based on what the ruling was in the Apple versus EP or the Epic versus Apple lawsuit. Whereas, if you're in Canada, which a lot of people get the lines blurred, you have to act differently. If you're in Europe, you have to act differently. Now, all of them are allowing offstore purchases, which is the use of the web shop and allowing people to take to direct to an offer somewhere. But how you get there, you it it plays a little different depending on where you are. So for instance, now in the United States, you can steer a

customer directly. You can take them directly from inside the game and have them buy something that's taking place, not in the store itself, even though it may look that way, but just in Canada, you wouldn't be able to do the same thing. And then in Europe, the rules are slightly different. So all of them refer back to what I'll call the web shop or offstore transactions where those things are becoming more and more prevalent. In some cases we're seeing up to you know between 40 to 60% of revenue being moved from traditional store transactions to some sort of offstore transaction or web shop. Gotcha. People really want that 30% back, don't they? Which brings us to in Exon's case the buy button. What's that all about? Buy button is a great new tool and really right now you'll only be able to use it in the United States where you can actually directly uh ask a customer to buy something. But what it does is while you're in that game uh a buy button is inserted. You'll push on that buy button as a player and

it'll slide up a little window which is in actuality a small web browser and it will allow you to transact directly from there. So for instance the offer can come up in the game. You'll push buy. this window will pop up, give you that offer in there, and then you can even use Apple Pay directly in there. So, you're still doing all the normal uh mechanisms of payment that you would do. You're creating less friction for your customer, but at the same time, you are directing them to an offstore transaction or a direct to consumer transaction. So, you're saving that 30% fee directly in the game with the buy button. So, it feels like you're in the ecosystem still. Feels exactly like you're in the ecosystem. And it's it's basically like a headless checkout. So, it looks like you're still within the game. Everything looks the same. It looks like your normal payment UI. Uh, and as things start to maneuver and change throughout the world, I think that buy button is going to become more important. So, we as as the rules start to change with the DMA and the DMA uh starts to be enforced stronger and stronger, which it looks like the EU is

doing, then I think those rules will start to allow for something like the buy button. I think depending on what happens uh with the the appeal with Apple and and and Epic uh then if it goes in Epic's favor, we may start to see legislation that comes behind this. And through that legislation, I think you'll start to see other territories that start to agree with this is the way that we should start to enforce. And once that happens, we'll start to have more unification, I think, of these processes globally, which will make it easier for people to digest and understand that they can have this buy button because the difficulty with it right now, but also the benefit is the benefit being like I can have this directly in my build if I'm targeting the right geo group, but at the same time, I have to have two different builds right now. And that can be difficult for some folks, but it's beneficial because in my opinion, you're still grabbing one of the largest audiences in the world. It must be quite like not tough, I suppose, cuz the

company that you deal with is a fairly largely scaled one. But with all these changes and the idea of the terms and conditions change, these legal legalities are introduced, then they're appealed, then they're kind of in a gray area, the need to be able to pivot quite quickly and stay compliant is kind of essential for a business like yours. How tough is it to steer a big ship like that? It's tough. Um, for us it's not as tough because what we have all the tools available. The tougher part is getting the people who need them to understand when and how they should use them. So that's part of what we're trying to teach people and train people. Then you have people who are being very cautious on one side of the table, right? Like what if the rules change back? Where is this in the appeals process? Good news there is the appeals court uh in the United States was they basically said like a week ago, we'll get to this when we get to it. We're not going to stay any of the rules. So meaning you can you you can't get rid of anti- steering right now until this is reheard. This is

the way it's going to be. So you have people who are who are kind of waiting anxiously to see if that sticks, right? Um and people people are being cautious about their own businesses and how they move these things forward because they don't want to give things to the consumer and then have to take them away or change their behaviors too much. We had talked about this behavior before uh that web shops and direct to consumer requires a different kind of mindset for the consumer to not just go ahead and buy within the game. Now we're telling you in some places you can buy within the game but you're not really buying within the game but only within this location. And if you're outside of that location, you have to have a different build and you still have to follow these rules here. So, rightfully so, you have a lot of big publishers uh who are very concerned about the user experience. And so, they're kind of taking a stance that we're going to weigh a little bit, but as these things start to go on, as the rules start to change, which we think that this this appeal will drag on for a while and then it will stick. I also think that there will be change in the EU that will conform more to what this

ruling has to say. And then you've got two massive territories that are both on the same side and then I think you'll start to see a bit more movement there. Gotcha. You've been talking to other payment providers who are interested in in incentivizing purchases via reward schemes and loyalty programs and that sort of thing. What sort of tools does Exola have in that region? Yeah, I think this is going to be a big piece of the the business for UA uh and for stickiness and retention uh for game developers. And so we have we launched I believe it was at GDC we launched our offer wall product which is basically the ability for publishers and developers to use the offers that we've gathered uh and put those into games. So it allows players to basically take incentivized offers to do certain tasks and in return they'll get orbs or they'll get in-game currency that they can use if they don't want to pay for things. Uh this will evolve over time into a loyalty program as well. think of like airline rewards and stuff like

that. Uh, and I think you'll start to see more and more of that being utilized as a means to bring and keep more players in the ecosystem who want to play, want to keep going, but uh, you kind of get more from them in the grind when you know that they're committed to some sort of incentive or offer or within a loyalty program scenario, you know that they're committed to at least your game because they're they're constantly trying to earn more rewards. Just like when you fly with the airline or hotel or anything, uh you don't necessarily go to where it's cheaper. You go to where they're going to reward you, treat you best, and give you the best type of offer for the future. And I think the same thing is happening within games right now. Yeah, sure. Well, we missed each other in Dubai. I was going to speak to Chris out there, but here we are in Barcelona for the first time. How do you find this as a as a a technology hub? Do you visit here often? Is this something that you're familiar with or is this a first time? This is my fourth time in six months being here. Um, there's plenty going on here. There's very big players here. Tilting Point has

their European office here. Scopely has their European office here. Um, I mean, looking around here, uh, this is the final hours of this conference and it's doing exactly what it's supposed to do. Uh, you've got games being showcased behind me. You've got two different rooms with, uh, speakers and panels that have been very, very busy. You've got the meeting tables that are going nuts. Looks like people are extremely engaged that are uh what I'm finding as I as I walk around and talk to people very much a part of this local community or very adjacent to this local community which means that people strongly believe that that Barcelona is a great place to be doing business in the games industry. [Music] [Applause] [Music]