Dominic Law, CEO of Neopets, speaking at the Gamescom Asia event in Singapore. Since buying Neopets for $4 million in July, Law and his team have been running a “reactivation campaign” to bring players back to the game.
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Moving abroad can be a lonely experience. For Dominic Law, moving from Canada to Hong Kong at the age of 9 in 1996 – before calling over Wi-Fi became widespread – meant it was almost impossible to contact his friends.
In an interview with CNBC at Gamescom Asia in Singapore, Law, who is now the new owner of virtual pet website Neopets, said: “Back then, we only had a landline number and IDD calls were very expensive. Canada to visit, that’s where my friends introduced me to the Neopets… and I played a lot with them and reconnected with all my friends back in Canada.
“It’s great that we can have a platform that transcends public geography and connects people, and I think that’s a big part of my childhood.”
Nearly two decades later, Law is now CEO of World of Neopia, the team that purchased Neopets in July for $4 million from Chinese company NetDragon Websoft.
For those who grew up in the early years of the Internet, Neopets’ bright yellow interface would be a familiar sight.
The Neopets website displayed on a phone screen and the Neopets website displayed on a laptop screen in the background are seen in this illustration photo taken in Krakow, Poland on July 19 2023. (Photo by Jakub Porzycki/NurPhoto via Getty Images)
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Neopets was launched in 1999 and the game allowed players to care for cartoon animals, chat with other users, and play mini-games. The game has a total of 150 million registered users, and at the height of its popularity in 2005, the game had 35 million monthly active users, Law told CNBC.
The World of Neopia CEO previously worked for NetDragon Websoft, helping the company restructure its education technology business, which included Neopets.
In this role, Law said he saw “the power of the Neopets community,” noting that even though Neopets is a 24-year-old game, it still has over a million active users.
Although current numbers represent only a fraction of its peak user base, he said the game is still cash-generating.
This is despite what Law considers poor management, which has resulted in little change over the past decade. For example, many of the site’s mini-games – essential for earning in-game money – have become unplayable due to the shutdown of Adobe Flash software on web browsers.
Since purchasing Neopets, Law said his team has been restoring these mini-games and modernizing them to improve the experience.
Some games on the site, like Poogle Racing, still haven’t been restored because Adobe Flash is not supported in 2020.
A check by CNBC found that while not all mini-games could be played and some features still displayed a notice that Adobe Flash was no longer supported, most of the site could still work.
Although Law is optimistic, he is aware that Neopets was born in a different era of video games.
The industry landscape has changed significantly in the 24 years since Neopets was founded. It’s a big challenge to become not only financially viable, but also competitive in today’s market where players are spoiled for choice.
For example, mobile games offer convenience and portability, while PC and console games offer graphics and gaming environments that are light years away from the web page browsing experiences and Flash mini-games of Neopets.
However, Law said that “the positive side of Neopets is that we’ve done virtually nothing new in the last 10 years and are able to keep the internet’s first gaming culture in its purest form .”
“You can do whatever you want, you can choose your own adventure. There’s no set way to play Neopets,” he added.
Law explains that this stagnation also means that Neopets has not evolved like the rest of the gaming industry, which he says has been “very focused on profitability, microtransactions and ways to squeeze every dollar out of your pocket “.
“We’ve always been a game focused more on fun and entertainment. And I think in the long run, that will always win. And one of the main reasons we’ve been able to survive for over 20 years is because we probably made for a pretty fun game.”
He acknowledges that Neopets probably won’t compete directly with triple-A mobile games like Genshin Impact, developed by Chinese developer miHoYo, or the PC and console heavyweight shooter Call of Duty, developed by Activision.
Instead, it will find its niche by capitalizing on players’ nostalgia for Neopets.
“We are like a living relic, like a museum that you can always visit and experience a different way of playing games.”
Law said allowing new users to experience what players did 20 years ago with Neopets is the game’s unique selling point – and it’s an experience that major game studios will have hard to reproduce.
Law’s team has been running what it calls a “reactivation campaign” to win back gamers, appearing at gaming events and enlisting the likes of singer John Legend as brand ambassadors to launch “a new era for Neopets.
Unlike a completely new game, Neopets already has brand awareness, which reduces the “cost of acquisition” – the effort required to bring players back into the game.
As Neopets accounts are attached to email addresses, Law noted that Neopets can send reactivation materials to former players through this channel. He claimed that small-scale testing has shown that “we can essentially do zero-performance marketing and still have enough of a grassroots community to come back and play any new experiences we come up with.”
Performance marketing refers to online campaigns in which advertisers pay marketing companies or advertising platforms for the results achieved.
A restored Neopets minigame, Kass Basher. The team managed to use modern technology to allow players to play these games which were outdated after Adobe Flash was no longer supported by modern browsers.
Law is confident that a good portion of the “abandoned players” will return as the game’s features are patched, saying his team’s efforts are already paying off. He said user engagement, activity and revenue reached a five-year high and that Neopets.com was one of the top 25 video game sites in the United States in terms of traffic and user engagement.
Still, Law doesn’t expect these reactivated players to stick around for long. “They might come back and say hello to their pets, but they won’t be clingy because they just finished the game.”
Neopets’ revenue comes from advertising, in-game purchases and subscriptions. So while revenue may increase alongside an initial increase in website traffic as inactive players return, that money will also decrease if users don’t stick around.
To strengthen Neopets’ long-term financial stability, Law plans to license intellectual property to sell merchandise and develop new games. Some partnerships planned for 2024 include a collaboration with the board game Monopoly and Upper Deck, a company that makes trading cards.
In his Gamescom Asia keynote, Law explained that while “non-players may not come back to play Neopets, I can come back to buy my childhood memories” in the form of merchandise.
He noted that merchandise generates more than 80% of the revenue of other major intellectual properties like Disney’s Mickey Mouse and Nintendo’s Pokémon. For Neopets, Law said product commerce would include both physical, such as plush toys and clothing, and digital, such as in-game purchases.
Law is also interested in “phygital” products, in which a player can purchase a physical product and, via a QR code, also get digital bonuses in games.
“The main goal is to bring back as many players as possible, but also to expand this world to the next generation of potential players.”
The company hopes to attract new users to the Neopets brand as more people interact with Neopets intellectual property through new games or the original site.
In 2024, Law’s team plans to release World of Neopets, a 3D simulation game that will use the existing Neopets world, but in a modern gaming environment. Law describes World of Neopets as a “3D open world simulator”, adding that while many elements will remain true to the current Neopets experience, others, like the mini-games, will become more sociable and may incorporate multiplayer elements.
“The gaming environment will be a way for them to rekindle their childhood memories, but also have something much more comparable to what they would expect as a modern game… it’s a “much like how Pokémon has evolved over the years,” Law explained.
Does this mean new Neopets games will replace the 24-year-old Neopets.com? That’s not the case, Law said. The original Neopets will still be around for the long haul, with players still able to play the mini-games they remember, barter for items with shopkeepers, and, of course, grab a piece of the giant omelette.
The Neopets Giant Omelet, where players could collect free food for their pets.