Integrating user-generated content (UGC) has become a transformative approach in the video game industry, significantly impacting both monetization opportunities and user retention rates. Pioneered by developers like those behind Roblox and Fortnite, UGC's potential to revolutionize player engagement and revenue models is just beginning to be realized, with significant investment indicating a long-term shift toward player-driven content creation.
UGC keeps players coming back
UGC refers to content created by users of an online platform rather than by the platform itself. In video games, this includes custom levels, mods, skins, personalized avatars, and other game enhancements. UGC enhances engagement through personalization and player empowerment, offering game developers significant benefits around in-game transactions and replay value. Players invested in creating content experience a sense of ownership and social reward, leading to increased engagement levels, particularly amongst Gen Z players.
Multiple studies and data corroborate this trend. Notably, a recent Ipsos-Generation Lab survey of 841 American gamers aged 13 to 34 found that over one-third of the 85% making purchases spend on in-game microtransactions. What’s more, as the lines between real life and the game world continue to blur, customizing personalized avatars has taken a strong 62% lead in individual player engagement behavior. As in-game creator tools advance and simplify, it’s clear that new features are welcomed by an audience socialized with content creation.
Pioneers of UGC-driven business models: Roblox and Fortnite
The OG UGC breakout
Roblox was one of the first to truly run with the success of UGC. Launched in 2006, today it boasts around 350 million monthly active users, 70 million daily active users, and 10 million concurrent users at peak times.1 The developer’s introduction of the Developer Exchange (DevEx) in 2014 marked a turning point, allowing creators to earn real money and significantly improving content quality and creator professionalism. This was fostered by two reinforcing network effects between creators and players, rapidly enhancing the overall platform experience.2
Today, Roblox's in-game commerce development plans cater to both large brands and individual creators. New features offer significant potential for brands, allowing real-world item purchases within the game, tracking conversion rates, and potentially shifting shopping habits from traditional e-commerce sites to the Roblox platform.3
Roblox also serves as a career platform, with creators profiting from their designs. Notably, 71.5 million daily users emphasize avatar customization, with over half of Gen Z users prioritizing digital avatar styling over real-world fashion. In 2023 alone, there were 165 billion avatar updates.4
Stories like that of @Jazzyx3 and @Lirn, two of the most popular Black designers on Roblox, exemplify the level of demand and response to DIY content tools, as well as their creative power. Their journey from players to full-time designers saw the two young creators build a profitable business creating diverse hairstyles and accessories for underrepresented communities.5
Hyper-Individualization of UGC
Fortnite’s catchy dances and skins quickly captured the hearts of the world, but its seismic contribution to the UGC trend was the introduction of “Creative mode”, allowing players to develop hyper-individualized experiences. Fortnite Battle Royale's success, driven by in-game microtransactions, led to 250 million registered users and 10 million concurrent users by 2019, generating an estimated $5 billion in its first year.6 Epic Games, Fortnite’s developer, further distinguished itself by introducing the Epic Games Store and a premium subscription service.
Following the record-breaking adoption of its UGC-driven features, Unreal Editor for Fortnite (UEFN) was launched by Epic Games in 2023. UEFN enables creators to become professional developers and is considered transformative in the industry. Despite its technical challenges, creators have expressed appreciation for Epic's opportunities and investments.7
The broader impact and future outlook of UGC
Looking forward, the creative power of player-driven content merging and expanding across digital worlds is seemingly not far off. Epic Games founder and CEO Tim Sweeney has publicly spoken about his vision of integrating gaming with virtual and augmented reality, social networks, and other entertainment forms, potentially creating a comprehensive "metaverse."8
Validated by the market, UGC will continue to evolve with new features that increase content quality and variety. The potential for supporting more complex games with player progression and retention could lead to a more varied and robust ecosystem - driven in key parts by independent creators and brands. While Epic's own games might overshadow some creator games, their developments driving millions of players to creative experiences benefit the overall ecosystem and creator trend.
Roblox and Fortnite have limited player crossover, indicating ample space for the UGC industry to grow without cannibalizing itself. Mobile access could potentially triple Fortnite's monthly active users, bringing it closer to Roblox's scale.
Meanwhile, other mainstream games are catching on quickly. Minecraft remains significant with 120 million monthly active users — a conservative estimate due to Microsoft’s regulatory scrutiny. Upcoming games from franchises like GTA and The Sims could further expand UGC ecosystems and their mainstream adoption.
Indie games and UGC are a match
UGC is a primary source of innovation in gaming. An increasing supply of plug-in DIY content tools is also leveling the playing field for smaller entities, helping them tap into the limitless potential of creator content - together with its monetization and retention benefits. According to Uri Marchand from Overwolf, the new generation of gamers is accustomed to endless content and opportunities provided by UGC. A single studio cannot meet this content demand, making UGC essential.9
The trend also aligns with the preferences of indie game players. A study by Humble Games of over 5,000 gamers between 18 and 45 years of age, found that indie game buyers appreciate original IPs, ambitious developers, unique mechanics, stylized graphics, and games that allow for personal expression. UGC fosters fresh and innovative content on a grander scale. Relinquishing creative control to the community can lead to larger audiences and more engagement.
An in-depth research study also resulted in strong evidence supporting the hypothesis that players' identification with their characters positively affects their intention to make microtransactions that enable customizability.10
The successes of Roblox and Fortnite highlight the potential of UGC to create vibrant, dynamic gaming experiences. As more franchises adopt UGC features, the creator economy is expected to grow, offering new opportunities for both large companies and independent developers to leverage new revenue and engagement opportunities. Indie game developers can strongly benefit from adopting UGC features while the trend is developing, integrating low-barrier-to-entry, studio-quality creator tools.
The addition of player-driven customization options can give your community a sense of ownership and open the door to co-creating a personalized game universe. Behaviorally and aesthetically aligned avatars are a powerful way to enable players to invest in gameplay.
Bring UGC into your own game
Ready Player Me's next-generation tools allow you to build a character customization system with any characters and content – including that made by your community. The built-in UGC tool gives your players the ability to show off their creativity and submit their own asset designs to be used in your game. Once you approve their creations, the content will be live in your game.
Apply for early access and learn more about our next-generation tools here.
