Colopl Innovates the Social Gaming Business Model

Scott performs mobile related research and consulting for Infinita in Tokyo. He is fascinated by all things mobile and is always seeking out new innovations. You can follow him on Twitter or contact him via email.

Last month Japan’s second largest carrier, KDDI (30 million subscribers), took a 5 percent stake in Colopl (short for ‘Colony Plus’ and pronounced ‘co-ro-pu-ra’), Japan’s booming location-based social gaming platform. The 5 percent translates to approximately $6.2 million in funding and a $125 million valuation.

The news received a fair amount of attention in Japan but barely made a blip overseas. This is just the way Colopl seems to want it. Unlike other social games, Colopl games go far beyond virtual items as a source of revenue. The company is tapping into a unique business model and wants to keep it their little secret.

While Colopl is just shy of announcing two million registered users they reportedly have $1.5 million in monthly revenue and log 2.5 billion page views a month. That translates to an ARPU of $0.84 and an average 1,250 page views per users a month.

It is time the rest of the world took a closer look at Colopl’s unique gameplay and business model.

Location Based Gaming

At first glance Colopl is like many time-management building games. The player plants resources on a grid which feeds a growing population. Users design a civilization and fend off attacks from incoming meteors. These gameplay elements alone have quite a bit of depth but what makes Colopl unique is the integration of the location check-in.

Rather than using the player’s location to log a visit to a store or serve up local information, Colopl awards virtual currency based on the real-world distance between two check-ins. Traveling 25km between check-ins generates 25 Pura (the in-game currency) for use when buying in-game items. The more a player travels the more they earn and the better their gaming experience is.

Checking-in is also incorporated into gameplay during critical moments. Periodically the player’s colony is threatened by a meteor attack. By traveling one kilometer and checking-in the player is able to avoid damage to their colony.

Although not essential to building a colony, checking-in to select areas around Japan allows players to redeem virtual souvenirs and collect location stamps. There are 748 location stamps and nearly the same amount of virtual souvenirs. Enthusiastic Colopl players plan weekends and vacations to collect these virtual items.