Zynga puts people in touch with their inner vocabularian, farmer, and gambler. The company is a leading social game developer with titles such as
Words with Friends
. It offers the games online for free primarily through Facebook, but also on its own website, with 108 million monthly active users in more than 175 countries. Players use a credit card or a service such as PayPal to buy virtual currency to purchase in-game virtual goods that enhance, extend, or accelerate gameplay. The company generates most of its revenue from the US; foreign customers represent about 38% of sales. Zynga was founded by Chairman and CEO Mark Pincus, who fashioned the name after his late dog Zinga.
Zynga's UK-based unit NaturalMotion develops mobile games such as
The US is Zynga's largest market, generating 62% of sales. It has about a dozen offices in the US and international locations in Canada, China, Germany, India, Ireland, Japan, Luxembourg, and the UK.
Sales and Marketing
As a social gaming company, Zynga uses social media for its marketing efforts. The company got 43% of its bookings and 51% of revenue through Facebook in 2014. Mobile devices are playing a bigger part in gaming, accounting for 44% of Zynga's revenue. The company's games are available in Apple's App Store and Google's Play store.
Zynga has been successful in reducing its reliance on Facebook as a source of game players, taking sales from Facebook from 85% in 2012 to 51% in 2014. The company's switch to mobile hasn't been as effective, even with mobile as the source of 44% of revenue in 2014. The $527 million acquisition of Natural Motion in 2014 was aimed at addressing the mobile market.
In a bigger shakeup, the company brought back founder Mark Pincus as CEO in 2014 and restructured by reducing headcount and closing some offices and data centers. It took a charge of $27 million in 2014 for the moves. That followed a similar effort in 2013.
The company sought to further address its mobile gaming situation with updated and new titles including version of
FarmVille 2: Country Escape
New Zynga Poker
New Words with Friends
. The company released
Looney Tunes Dash!,
which featured Bugs Bunny, the Roadrunner, and other Looney Tunes characters, in late 2014 for the mobile market.
Competition is another factor complicating things for Zynga. Games such as
Candy Crush Saga
Clash of Clans
have gained popularity at the expense of Zynga's offerings.
Mergers and Acquisitions
Zynga uses acquisitions to expand globally and help it become less dependent on the Facebook platform and the US market. Acquisitions also help diversify its development teams and, consequently, its catalog of titles.
Its acquisition pace completely stopped by 2013 following the restructuring, but 2011 was a busy year. That year it bought 15 companies to build its portfolio of social games, obtain new employees, and expand internationally.
In 2012 it made one of its largest acquisitions, paying about $180 million for creator of
, OMGPOP. Also that year it bought Wild Needle Games, which focused on mobile games for women.