Splinterlands Economics: First Mover Advantage

in Splinterlands2 months ago

Hello everyone! We are back again today with another edition of Splinterland Economics - a series in which we introduce a basic economic concept and then apply it to Splinterlands. If this is your first time reading, just to tell you a little bit about myself: my day job is in an unrelated area but I consider myself a little bit of economics nerd - I read a little (or maybe way, way) more news than I should, double majored in econ, and am obsessed with optimization. I love the way Splinterlands is equal parts card game and resource allocation game. My goal with these articles is to share a little bit of what I know with you all.

When it comes to a footrace, business, or even (or perhaps, especially) Black Friday sales, it is often helpful to be ahead of the pack or at the front of the line. It just so happens that there is a concept in economics that describes that situation, and that will be our topic this week. Today, we will be talking about First Mover Advantage!

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What is First Mover Advantage?


movers of a different kind source

First Mover Advantage refers to the benefits that a company is able to gain by being the first to gain a sizable market share while offering a particular good or service. And there are many of them! The first company to offer a product will not have any competition from other companies in that space. This gives that company an opportunity to introduce prospective consumers to a brand new product that they may want to spend their money on. For example, Amazon was the first company to sell their books online. As a result of being the first company to that space, Amazon was able to scale up their business and expand into the massive online retailer (as well as provider of various other services) that they are today.

Being the first mover also allows a firm to gain a reputation and earn customer loyalty. Companies like eBay and Coca Cola were the first ones to capture sizable portions of the online auction or soda market, and have gained large followings as a result. And a large company that is already providing its product to many people will have more opportunities to gain increased efficiency by taking advantage of economies of scale and its institutional knowledge.

A related thing to note is that having a first mover advantage makes it more likely that a company can maintain market leadership. Once customers being using a product or service they may be more inclined to stay with the same company or brand due to switching costs - the difficulties or costs associated with changing which product a consumer is using. If you have grown up drinking Coca Cola your entire life then you may not want to switch to Pepsi. Or if a customer has spend a substantial amount of time and effort in order to learn how to use a particular product, then changing to a different vendor's offering could take a lot of time and money.

How do we apply it to Splinterlands?

Splinterlands (the company) is a first mover in the blockchain gaming or play to earn area. Splinterlands (the game) was one of the earliest successful play to earn games around and as a result has had plenty of time to establish a strong track record and to earn player loyalty compared with other groups in the P2E gaming area. Their additional time in the space has also given the Splinterlands team additional experience in running the economics and mechanics of a play to earn game.

The Splinterlands ecosystem itself has additional examples of first mover advantage. There are many opportunities for third parties to offer various services related to the game such as card markets, rental services, or botting/autoplay services. The first person or group to offer a service can gain significant market share and earn customer trust and loyalty - and trust in particular can be very important in any place where account keys (even the lower level ones) may need to be shared.

Why should we care?

Splinterlands is an asset allocation and economy game just as much as it is a card autobattler. Understanding first mover advantage helps to put more context on Splinterlands' place in the crypto world and allows us to make more informed decisions when it comes time to decide what we want to do with our hard earned money. Outside of Splinterlands, first mover advantage helps to explain why some companies have grown to dominate their markets, and why venture capitalists may decided to invest in small businesses - the potential payoffs are huge!.

One final thing to note is that while being a first mover has its advantages, it is NOT a guarantee of success. Particularly when there are profits to be made, it is very possible for another firm to come along and take over, becoming the dominant player in an area. In fact, there are also advantages corresponding with being the second mover into a market, though that is a subject for another day. However, being aware of the first mover advantage and how it works lets us to have a better grasp of market dynamics in order to make better investment choices.

Thank you so much for reading all the way to the end. Interested in seeing some more of my writing in the future? Be sure to give me a follow! In the meantime, if you'd like to see some of my recent posts:

Thinking about giving Splinterlands a try but haven't signed up yet? Feel free to use my referral link: https://splinterlands.com?ref=bteim, and be sure to reach out to me if you have any questions!

All images used in this article are open source and obtained from Pixabay or Unsplash. Thumbnails borrowed with permission from the Splinterlands team or made in Canva.


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Hello my friend! Those economical concepts will be very important to be known for everyone to take the best decisions they can! So much uncertainty and too much to analyze! Cheers! BTW we would very interested if you use #THGaming tag for such great content like this the nexts times! Cheers!


Thank you for stopping by! I didn't know about that tag before, I will start using it on future posts in this series 😄

Count on us my friend!

Thanks for sharing! - Underlock#8573