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Vlad Panchenko, CEO and Founder of DMarket, joined us to talk briefly about their platform for skins monetization, and his talk at GDC 2019 on building a strong in-game items economy.
80lv: Hello, Vlad! Thank you for joining us. DMarket has been “on the market” for quite some time. Could you tell us how it appeared and developed into what we see now? Are there any major changes planned in the nearest future?
The idea of DMarket, a platform and technology for skins monetization, was born a few years ago. But let me quickly jump into its history. I started distributing digital games more than 10 years ago, founded the company Suntechsoft Corp Limited and now it is the number one private merchant of digital goods in the world. In 2016, my business partner and I founded Skins.Cash, a unique service that allows players to sell their in-game skins instantly. It’s a global market with over two million visitors per month and more than 20 million trades each year.
The swift success of Skins.Cash and my own experience as a gamer helped me to realize the tremendous potential of in-game trading. At the same time, I recognized several major issues that prevented the gaming industry from fulfilling that potential. The issues obviously include massive fraud and general market insecurity but also a total disconnection between different virtual worlds and a limited selection of games that give players an opportunity to trade their items, monetize their efforts and, most importantly, have more fun while playing favorite titles.
DMarket was created to address all those issues. The initial idea hasn’t changed since the beginning but we are always working on new approaches that can help realize it. A big upgrade of the DMarket platform is coming soon. We gathered a great deal of data on the current product workflow, analyzed loads of user requests, and took into account suggestions from game developers. We have also combined the results with the data from our previous projects to create the ultimate trading ecosystem that reflects the needs of the entire gaming community.
Uniting Game Developers
80lv: You claim to bring together various platforms and games and create one global trade market but currently, there are 3 games available. What future plans do you have in terms of drawing in new platforms? What major difficulties does your team face here? It’s certainly not an easy task to unite all the players together.
The three games are definitely only the beginning. As I have mentioned before, new games are coming with the renewed platform. Everything is moving in the right direction along with major support from our key partners – Xsolla and Unity.
We still have an evangelizing job to do in order to draw in as many games as possible, but it’s a challenge we are prepared for. It takes time and effort to convince game publishers and developers that the solutions we offer bring more profit to them and more fun to players. Fortunately, we do have data that backs up our ideas and solutions. And we are always happy to share this data with game developers. It shows with numbers that our technology has everything to strengthen in-game economies and benefit both developers and players.
80lv: For those who are not familiar with your service, could you talk about the market sections and the items that can be found there? There are numerous badges there – what’s their purpose and how can they be used?
There are three categories of items that are tradable on the DMarket platform. The first is Steam skins from CS:GO and Dota 2. The second is the cards from the DHeroes mobile game. The third category is collectible badges, digital assets commemorating special occasions and achievements. They are displayed on their owners’ accounts as privileged signs and have collector value because of their limited supply.
80lv: We’re sure you’ve been asked this question previously, but how does the whole system of your platform work? What allows you to provide users with commission-free trading?
Trading of CS:GO and Dota 2 items currently goes through Steam integration, while DHeroes cards and DMarket digital assets are traded directly on our blockchain. Anyway, DMarket users easily and securely buy, sell, and exchange skins.
As for commission-free trading, it is a temporary decision that helps us attract more users to the platform. We will introduce fees in the future, but they will be lower than on most currently available skins trading platforms.
80lv: At GDC you gave a talk on building a Strong In-Game Items Economy. Could you share some insight into the topic and touch upon the core elements that allow the players to make a considerable profit off the virtual items? This is a very relevant topic, I’m sure lost of gamers looking for the ways to gain benefit from trading.
You can find Vlad’s Keynote for his talk at GDC here.
My GDC talk targeted game developers in the first place. As I’ve mentioned before, we evangelize the benefits but also explain the challenges of in-game trading. And we prove it with specific numbers on skins trading. For example, we show which CS:GO skins are the most visible to players and how it influences the in-game items sales and revenue. We explain the difference between free-to-play and pay-to-play models in terms of skins economy. Lots of top games are built around skins. APEX offers around 2000 unique skins, Fortnite gives the players the opportunity to be unique via cosmetics. That’s just a few examples. At GDC, I shared our data and insights on the current state of the skins market and its future potential. The difference between the current state and the potential demonstrates the massive hidden demand for skins trading among players. Our mission is to help developers tap into that demand in the most efficient way for both themselves and their game communities. I’m always ready to share more sneak peeks with developers. The more developers will catch up, the more players will get an opportunity to monetize their gaming time and get more fun while playing favorite games.
Vlad Panchenko, CEO and Founder of DMarket
Interview conducted by Daria Loginova