LogInVladimir Tokarev, CEO at Artmer Studio, talked to us about creating 3D content for non-gaming brands, discussing why such brands need this type of content, how they conduct their expertise, how to find clients, pricing, and which market trends we'll witness in the future.
Introduction
Since 2015, I've worked at three different outsourcing studios. Before that, I taught 3D graphics to students as part of an additional education program. I graduated from university in 2011, and for the next three years, I balanced teaching graphics with pursuing a postgraduate degree. I have a solid background as a 3D Artist.
Creating 3D Content for Non-Gaming Brands
We have a case with a company called Viceversa. They created a website shop for brands using their own SDK. Brands would send them clothing, shoes, and bags, which they would scan. We handled the post-processing and adapted everything to their shaders and SDK so that it could be viewed, rotated, etc. They mainly worked with major brands like Nike and Cartier.
Why Non-Gaming Brands Need 3D Gaming Content
It all comes down to money, as always. For instance, when they need to render or process something, let's say they scanned around 70 models in half a year and then need to showcase them again in 3 months, they’d need to hire around 70 artists, or at least 20. This is very time-consuming; hiring takes a long time. Then, if your project is completed and doesn’t need ongoing support, you have to lay off staff, which is also quite expensive for a few countries.
Non-Gaming Clients Vs. Game Developers
The biggest problem for non-gaming clients often arises when no one has the necessary expertise to carry out an evaluation. In such cases, they organize something like a tender, similar to what game developers do. They gather a shortlist of pre-assessment, then select outsourcing teams of average cost. If the quality is unsatisfactory, they try someone more expensive. Sometimes, this process consumes a lot of time.
Non-gaming brands understand what 3D content is about quite well. At least, based on our experience when we worked with them, they had documented instructions and a clearly defined pipeline, so there were no issues. I know that sometimes they ask for a pipeline to be written, and we’ve done that sometimes as well.
Finding Clients
As for the demand for 3D and virtual experiences creation from non-gaming companies, we had one client there for almost 7 years. Clients come to us on their own, meaning these are requests that simply come to the studio. They come through business email, various channels, or someone's recommendations.
It is often very difficult for outsourcing teams to find orders, and they have to work for many, many years for brand recognition, investing heavily in advertising. After roughly 5 years, you could say that you’ll be somewhat recognized in the market. Until then, with a team of even 20 people, it's challenging.
Pricing
The price depends partly on the rarity of specialization, so animators' rates are clearly higher because there are relatively few of them on the market and there is a high demand for their services. However, there is significant competition in the art outsourcing market right now.
3D Content Creation Trends
As you may have heard in the news, Microsoft downsized a department recently, which is a result of the audit that was conducted in 2022, after the acquisition of numerous studios. They carried out downsizing, disbanded many studios, and, in 2023, the entire HR department was dismantled, including directors.
Investors said that the development process needed to be cost-effective, so development and outsourcing will be shifted to the LATAM and APAC regions. Everything will be moved to these centers. Currently, they are in the operational phase, finding offices, relocating management, and purchasing equipment.
Next year will be very challenging for outsourcers from Eastern Europe. Firstly, they won't match the time zones, and secondly, most of the generic assets will be produced in the APAC and LATAM regions, while only rare and specific tasks will be sended there.
Prices on the CIS market
Adjustments are made for inflation, but there is no significant increase in pricing. India, Vietnam, Malaysia, and the Balkans, where Funcome has offices, do amazing 3D work. In these regions, you could still complain about the quality five years ago, but now they are working on Diablo IV, helping with the Diablo II remaster, and contributing to the latest Assassin's Creed as well. They are competitive in terms of pricing because the cost of living is lower, which comes from tax rates.
Changes in the Market for 3D Content for Brands in Five Years
Most likely, in five years, neural networks will be refined, but they won't do everything automatically. It will be necessary to integrate all this into one's pipeline and do a lot of follow-up work and revisions. When Nanite was released in Unreal Engine, all the 3D artists weren't thrilled because it meant a lot of work, not the most enjoyable work.
The situation with shifting outsourcing to regions is solved as follows: it either reduces production costs for developers and outsourcers from the CIS, or involves creating very specific specializations or expensive technologies that can’t be quickly implemented in the same way in the APAC region. So, it's either reducing production costs or creating something very valuable from a technological standpoint, but that requires huge investments.
Potential Budget for Non-Gaming 3D Content for a Brand Like Ferrari or Rolex
If such a brand orders a commercial, it’s handled either by several companies or by one company that may acquire expertise from several companies. I believe it's not that they allocate a specific budget that everyone knows about.
Usually, they send inquiries to many companies they likely work with. All major brands have their own vendor database. They gather data on vendors, create a shortlist, and conduct a trial with this shortlist. If everything goes well, whoever performs the trial best will be chosen to work on the project.