The new smartphone Pokémon Go game is big, very big, and so far, it’s only getting bigger. So for those who don’t know what the big hubbub is about, here’s the gist of how the game works:
Based on the once-famous Pokémon franchise of the 90s, today’s game entices players to find Pokémon (that’s both the singular and plural form) in real, physical locales. Through playing the game, people are walking their city streets, interacting with their environments, and exploring the landscape in new ways, all while in pursuit of getting various Pokémon which could look like anything: trees, snakes, rats, dragons, eggs, you name it. Some Pokémon are common, others are rare, and yet others are extremely rare, so much like collecting baseball cards, there’s some satisfaction in nabbing the rarest of the Pokémon. Then, there’s the social component too. Players can have their Pokémon compete against one another at a designated Gym which in our real, knock-knock, tangible work might be a business, a park, or even a museum.
So far in the U.S. alone, Go has been downloaded more than two million times on iOS devices and is generating approximately $1.6 million daily in revenue from in-app purchases (according to market researcher Sensor Tower Inc.).1 As of the time of the writing of this article, the market value for the comeback game, Pokémon Go, reached 11 billion since its opening on July 11, 2016.
It’s a craze that’s got Wall Street aflutter while also signaling to some that this is just the beginning of greater cultural and technological shifts powerful enough to sway the markets on a global scale. Understandably, certain members of the old bastion may feel somewhat insecure about what lay ahead.
On a recent edition of CNBC’s “Mad Money,” host and money manager Jim Cramer summed his feelings about the changing times when he said, half-jokingly, “Does something about getting older somehow disqualify you from not being able to make money? That’s what I keep wondering as a watch the stock of Nintendo levitate because it owns a piece of Pokémon Go, a craze my kind are all caught up in which makes no sense to me… The world of youth is taking over the world of stocks and like Bob Dylan said, ‘the times are a-changing.’”3
Meanwhile Nintendo’s stock (NTDOY) continues to soar, sending the S&P to new high, closing at 2,137.16 on Monday (July 11). Despite the record-breaking numbers, at least a few market analysts are sure to sound disaffected by the stock’s performance calling it pure hype. During an interview with Bloomberg News, broker and analyst at Webbush Securities, Michael Pachter said, “The game requires couch potatoes to get off the couch, and the novelty will wear off when they get tired or when their phone batteries die. I give this four months at the top of the charts, then it will fade.”2
Will the Pokémon Go craze fade? Inevitably yes. But Pachter either misses the larger point or chooses to ignore it altogether. The magnitude of this phenomenon is bound to have a ripple effect. Sure, investors will undoubtedly set their sights on spotting the next app or game that’s sure to be the next Pokémon Go, and many will fail in this pursuit. But the real, lasting effect of the Pokémon Go phenomenon isn’t going to happen anywhere near Wall Street, rather, it will happen amongst developers, game designers, and technologists who will be setting their sights on the opportunities that lay ahead. Entrepreneurs, geeks, and existing businesses will find themselves intrigued by the possibilities of AG and combining tech, social and terrain in a multitude of interesting new ways. Where there is intrigue, passion, and talent, there will inevitably be growth.
And yes, we can also call June 11th the day a rehashed 90s game took over city streets and Wall Street alike. Go Pokémon Go!