Back in July, MangaGamer’s Head Translator, John Pickett, revealed that the company’s profits come primarily from the “nukige” they localize, whereas the company’s more story-based games still run the risk of losses, making them a less financially viable choice for localization.

Nukige, in this context, is a term being used to describe the company’s more erotically-inclined visual novels. Most visual novels that MangaGamer localizes have sex, but nukige tend to put a greater focus on the sexual content, while the story takes a back seat. It is for this reason, Pickett said, that nukige are typically cheaper to localize, while longer, more story-centric titles tend to be more expensive. Story-focused games have more dialogue and require more time to localize.

When I recently spoke with Pickett about a number of things going on at MangaGamer, I brought his comment about sex versus story-driven games up, and asked if he could elaborate on how they actually sell in comparison to one another. Is the difference purely in terms of profit, or also in terms of actual sales numbers? Which one is more popular?

Story versus sex:

“In terms of raw sales, the truth is that most of our games with adult content tend to sell roughly evenly,” Pickett said to me. “We can generally predict how many copies any given story or character-driven game will sell based on recent efforts in the market. A typical nukige from Softhouse Seal or Liquid on the other hand, generally sells roughly 80% of those projections on average in terms of initial launch sales.”

“However,” Pickett explained, “development costs for those same titles are typically 30-50% the cost of story or character-driven titles like Deardrops (NSFW) and Harukoi Otome.”

“Typically, in past years, we only saw ‘hit’ releases in our story and character-driven titles. However, with the release of Eroge, we finally had the first nukige in our line-up able to compete with story-driven titles in terms of length, and it proved to be a ‘hit’ for us. Demon Master Chris also managed to thoroughly surprise us by becoming our first big ‘hit’ as a shorter nukige as well. Both Eroge and Demon Master Chris have brought in similar numbers in terms of raw sales figures.”

All of this only applies to initial launch sales, however. When you take long-term sales into account, nukige outsell MangaGamer’s more story-driven titles by a large margin.

“Nukige still have much larger long-tail sales than most story-driven games do,” Pickett revealed. “For example; we still see a noticeable number of sales every year for We Love Master, even though it’s been out for several years now. So, between the lower development costs and larger long-tail sales, nukige are definitely still more profitable at the moment. Perhaps Steam may soon change that, though.”

Picking what games to localize:

My next question to Pickett was how MangaGamer decides which games they want to license. Do they have someone crunching the numbers and going, “We need X number of sex games this year and we can use that to fund Y number of story games?” Or do they just play it by ear?

“In reality, it’s a bit of a mix of several different factors,” he replied. “At this point, our company is established enough and has enough data that we can pretty much estimate roughly how much profit we’ll make on a game of a given length, and totals usually average within estimates for a given financial year. Backend costs mean we do have to ensure that we make a certain amount of net profit off of our game sales every year, but we’re also starting to reach the point where we have enough monthly profit from our products’ various long-tail sales that we stay fairly balanced and can start moving away from ‘we need to publish this many nukige to cover base expenses’ and can start looking at the projects our localization staff is far more interested in.”

Pickett says that these projects often come about from asking questions like “what would be fun to work on?” and “what would be something we think others will enjoy playing (because we do too)?” Another topic that occasionally comes up is “what’s something new we can try—something different for the Western market?” Finally, beyond those factors, fan requests are something that play a heavy role in deciding what games MangaGamer licenses as well.

What happens next?

Once a game is decided upon, it’s time to start the negotiation process for licensing the title in question, which is often rather complicated, depending on what Japanese studios you’re working with. In order to do this, Koji Hotta (AKA Evospace), who is in charge of licensing at MangaGamer, begins tracing through the various connections the company has with its existing business partners, in order to get his foot in the door of the necessary developers.

“Once we’re in the door is when it gets hard,” Pickett says. “Often times a developer’s willingness and interest in the West end up playing a key role. In Japanese business, one never burns bridges because they don’t get repaired, so often times an initial ‘no’ can mean patiently waiting months or more before trying again with new data and developments. So, in the end, developer enthusiasm towards expanding into the West can play an even larger factor in determining what games we pick up.”

“More than once, we have managed to pique a brand’s interest, only to have them offer a different title than we had initially hoped for, and in times like that it can be a tough decision as to whether it’s more valuable to take the offer or wait until a later time to revisit it.”