Crowdstar CEO: From War Game Thrasher To Fashion Game Maker

Crowdstar, a veteran among companies that have combined computer games with social media sharing, says it has crafted its biggest hit so far and made the transition to mobile. That’s surely a business story, but what interested me most was the personal transition made by the Burlingame, CA-based company’s CEO, Jeffrey Tseng.

Tseng grew up playing all sorts of games on video consoles like Atari’s, at a time when “the whole gaming industry was built by men making games for males,” he says. That masculine stamp continued when Tseng started his career as a game developer, notably at the San Francisco video game studio Secret Level, which created titles including “America’s Army: Rise of a Soldier” and “Star Wars Jedi Starfighter.”

The industry was producing zero sum games where the payoff was establishing personal dominance, Tseng says. “When I win, you lose,” Tseng says.

But in the game that’s now raising Crowdstar’s fortunes, Covet Fashion, the top winner of a daily style contest gets a luxurious ball gown to hang in her virtual closet, and validation of her fashion sense from fellow players who voted for her. The losers also get a virtual designer item, and the chance to compete again another day by assembling a new outfit online.

The win-win rewards extend to more than 150 real-world apparel makers such as BCBG, Rebecca Minkoff, French Connection, and Rachel Zoe, which display their designs on Covet Fashion in virtual mode, and also offer links to their e-commerce sites so players can buy the actual clothes to wear themselves.

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For several years, Crowdstar has been making a transition to designing social games tailored for women. Tseng found he had to throw out all his notions about the core mechanics of successful games, learned in a decade in the console game industry.

“It was a process of unlearning,” Tseng says. His combat-tested younger self might be astonished at the way he talks about his current game developer philosophy.

“It’s empathy with the audience that is the number one driver for us,” Tseng says. “We start with the core psychology of our audience and what they care about.”

Covet Fashion, first launched in June 2013, is still evolving. But the game has helped Crowdstar achieve profitability, double its revenues in 2014, and reach a staff size of 70, Tseng says. It was the result of the experience the company gained as it developed and marketed 30 games since its founding by Tseng and two partners in 2008. Crowdstar has raised more than $40 million since its inception, from backers that include Time Warner and Intel Capital.

Women turned out to be the majority of players of Crowdstar’s early titles, including Happy Pets and Happy Island, where people could design a vacation paradise. The company then intentionally developed games for young women, such as It Girl, a fashion game shared on Facebook.

The target market for Covet Fashion, created as a mobile app, is women 25 and older who like to experiment with fashion combinations, get suggestions from fellow users, and gain confidence in their sense of style.

“A lot of women want their games to feel useful, to feel they’re still learning something, they’re not wasting their time,” Tseng says.

Covet Fashion allows women to simulate the experience of buying high-end designer clothes that go for $200 to $500 per item at Saks, Nordstrom, or Bloomingdale’s. The app releases 16,000 fashion items a year for players to choose from. The game’s users get a free virtual $500 to start with as they “buy” clothes and accessories and put together ideal outfits for the day’s contest theme, such as “First Date,” “Black and White Ball,” or “Modern Day Snow White.”

If they run out of virtual cash, they can buy more. The exchange rate is $1 for an extra $300 of play money. “This is our main source of revenue,” Tseng says.

Women can now join “fashion houses” of up to 50 players, where they advise each other about the outfits they assemble. When a player enters a contest, she must also vote for the winner. The game displays randomly selected choices to avoid bias in favor of the voter’s online friends.

Once a player “buys” a virtual dress or handbag, it stays in her closet permanently, where it’s easy to search for. Players sometimes find themselves rummaging in their real closets for a favorite item, Tseng says.

“Then they realize they don’t have it,” Tseng says. “It’s in their Covet Fashion closet.”

The game allows women to get familiar with brand name clothing, and it boosts sales for the clothiers, says head marketing executive Blair Ethington. But Crowdstar doesn’t charge apparel makers a fee for showcasing their designs on Covet Fashion, nor does it take a cut from the online sales it sends their way.

Crowdstar is competing in a market thick with online and mobile offerings that tap into women’s love of design, including Pinterest and fashion discovery apps such as San Francisco-based HeartThis, whose co-founder Andrew Gadson also has a background in social gaming. Big clothing companies are fully aware of the potential of such interactive consumer sites to generate sales. Ralph Lauren and Kate Spade & Company are among the corporate backers of the New York Fashion Tech Lab, an accelerator program that accepted its first class of startups in 2014.

Crowdstar is using its gaming elements to entice consumers to keep coming back. Covet Fashion players not only control the elements of their virtual outfits, but also choose the coloring and hairstyles of the “models” that wear them. But, I asked Tseng, why can’t women vary the build of the models, who are invariably very tall and thin?

Tseng says the models’ silhouettes are inspired by fashion illustrations, to serve Covet Fashion’s role as a styling exercise.

But wouldn’t many players, and even some designers, want to see how their outfits would look on an average woman, or even someone short and stocky?

“We have high empathy for that,” Tseng told me. “It is something that’s very top of mind for us.” He didn’t disclose any imminent changes on that score, but he said Crowdstar will be developing new features for Covet Fashion on an ongoing basis.

“We’re continuing to iterate,” Tseng says. “We’re only 30 percent there on the product.”