Maximizing Player Retention and Monetization in FreetoPlay Games

$$$$$$$ Maximizing Player Retention and Monetization in Free-to-Play Games: Comparative Stats for Asian & Western Games David P Chiu Director of Business Development & Developer Relations (Kongregate) Principal, Business Development (Game. Stop Digital Ventures) Emily Greer Co-Founder & COO (Kongregate)

What is Kongregate? • Open platform for browser-based games – Flash, Unity, HTML 5, Java, etc. • • • 15 M monthly uniques visitors worldwide Core gamers – 85% male, average of 21 MMOs, RPGs, CCGs/TCGs, TD, shooters, etc. Platform level virtual currency “Kreds” for F 2 P games Mobile publisher of F 2 P games for core gamers Acquired by Game. Stop July 2010

Some of Kongregate’s Existing Developer Partners

Stats both reflect & shape mind-set So what statistics does F 2 P focus on? Daily Active Users, DAU $/DAU 1 - & 7 -Day Retention To a lesser extent MAU & 30 -Day Retention is a good stat, but 30 days is not “long-term” retention, it’s the start.

A little background All stats are lifetime, min 6 weeks on platform ARPU: average revenue per user ARPPU: average rev per paying user Player: a Kongregate registered user who loaded the game page at least once • Plays = Sessions: our preferred method to measure retention • •

ARPU and ARPPU

Big spenders matter

Linear Growth x Many Years = Awesome Business

Asian F 2 P vs Western F 2 P

ARPU and ARPPU

ARPU & ARPPU • ARPPUs for single-player games cluster around $5 -$10 • Multiplayer games range $20 -$350 • • Average ARPPU for a multiplayer game from Asia: $181 Average for Western multiplayer game: $51 Only 9 Western games have an ARPPU above $100 ARPPU is the main factor in high ARPU for Asian games, important factor for all games

ARPU and % Buyers

ARPU and % Repeats

ARPU and % 50+ gameplays

Asian vs Western Style • Asian games: High ARPPU, tight player funnel – Monetization caters well to big spenders • Western games: Lower ARPPU, wide player funnel – Monetization focuses more on initial retention and broad conversion to paid at lower prices – Pay 2 Win is not as accepted by Western devs • Mixed games: can combine the best of both – High conversion, wide funnel, still create big spenders

F 2 P Best Practices

Best Practices for Optimizing Retention: Keeping players engaged

Daily Play Bonuses • Daily play bonuses are good to get users coming back regular • But improve on the typical 5 -7 day daily bonuses • Reward playing game regularly in longer term • Doesn’t reset after 5 -7 days • Doesn’t “punish” players for missing a day

Daily Play Bonuses • Add an element of chance - make it exciting! • Repeat logins opens up bigger potential rewards

Don’t punish people for taking a break • Psychologically, punishments or the possibility of punishment deters unwanted behavior • Base/castle raided, loot stolen, crops withered, troops dead, account de-activated, etc. deter players from being away too long • But it can be a two-edged sword • Players sometimes need to take a break (exams, vacation, illness) • Punishment may drive re-activated users away again “I just got back from vacation/work conference/being sick but my base is completely destroyed, my resources are gone, troops are dead. No point in getting back in the game since I lost everything already. ”

Don’t punish people for taking a break • It can sting but it shouldn’t handicap you permanently • Limit amount of resources that can be looted or # times you can be attacked while gone • Enable shield or protection time if you lose a significant amount • Mix positive reinforcement with punishment • Quick one-button rebuild • Resources still available for harvest • Gain XP or gold while away

Keep players busy! More things to do = more players staying Solo and team Pv. E Solo and team Pv. P Asynch raids Guild battles World boss raids Farming Town Building Weapon/Gear Synthesizing & Upgrading • Astral Collecting and Combining • Etc. • • It is important to pace the introduction of new features/gameplay modes to not overwhelm players with a long and intimidating tutorial.

Without progress you have nothing The foundations of a F 2 P game are a strong RPG elements and a sense of progress over time. Surprisingly it’s more important than multiplayer Type % 50+ Plays % Buyers ARPPU ARPU Multiplayer RPG 2. 6% 0. 75% $69 $0. 51 Multiplayer Non-RPG 1. 0% 0. 45% $9 $0. 05 Single-player RPG 1. 8% 1. 29% $12 $0. 10 Single-Player Non-RPG 0. 2% 0. 53% $4 $0. 02

Asynchronous > Synchronous Multiplayer is a good way to keep players engaged and busy in the long run but not all types of multiplayer are created equal Type % 50 Plays % Buyers ARPPU ARPU Synchronous 1. 4% 0. 54% $43 $0. 25 Asynchronous 3. 6% 0. 80% $88 $0. 66 Both 2. 9% 1. 07% $51 $0. 55 Single-Player 0. 8% 0. 85% $7 $0. 05

Best Practices for Optimizing Monetization: A happy customer is a paying customer

Shopping should be easy and frictionless • Location, location – make the store easy to find! • Make it easy to find the right item – Meaningful categories and item descriptions – No massive scroll bars • Mix soft currency and hard currency items • BUT – don’t try to sell too hard, too fast. First few sessions should focus on fun & giving players reasons to come back to play and get hooked.

Buy Screen • • Bonuses % or/and items provide incentives for buying larger hard currency packages Clearly call out bonuses of larger packages! Make all packages visible in one page Hide $100+ packages until after first purchase

Making the shopping experience interesting • • • First time buyer/ Starter packages Seed players with some paid/hard currency and guide “intro purchase” Deals/events to get people into the habit of spending regularly Offer items that enhance the gameplay experience (not just speedups) Intro the right items at the right time – Lvl 1 players should not be shown the lvl 100+ holy sword that’s on sale for $100) • Keep them coming back – keep store fresh by adding new items, unlocking items as players level up and featuring seasonal and time-limited items

Gamification of buying • • VIP program – customer loyalty program like airlines and hotels The more you buy, the more status points you earn which unlock more benefits/bonuses

Make sure players can spend as much as they want • The longer someone plays your game the more likely they are to buy and the less price sensitive they become • Give committed players the ability to spend at $1, 000+ if they want • Have lots of items that are appealing and useful to a committed player and price them higher (if possible) than items meant for early/mid-game play. [Higher means $30 -100, not $1000] • If you make a fun game, someone may want to spend an infinite amount. • Don’t create a situation where spending is capped by availability or utility. • Again, remember to make it easy for players to buy!

Best Practices for Community Building: When you’re here, you’re family!

Make it easy for community to build Chat, forums, player-to-player messages are all great Real relationships build when people interact. The more ways they can do it, the better.

Guilds are awesome 100% of our top games have them. Some reasons they make a difference • Social incentives to return I want to see my friends • Social pressures to return I don’t want to disappoint them • Improves the psychology of purchases I’m doing it for the team, not me • Upends the dynamics of pay-to-win can set up a symbiotic relationship between buyers and non-buyers where both add value to the same group

Community Management and Customer Service If a player invests many hours into a game they begin to feel some ownership. It may be YOUR game, but it’s THEIR experience 1. 2. 3. 4. 5. Be visible – forums, chat, email Listen to their concerns and acknowledge their emotions Be transparent, honest, and accurate Give advance notice of changes and downtimes Don’t feed the trolls

Opportunity Complains Customer service is a chance to surprise and delight • Handle things quickly • Be generous with compensation • But don’t do something unless you’re willing to do it for everybody

Surprise and delight • IGG rewards its players with some resources after each of its weekly 30 -minute maintenance

Have fun with your community

THANK YOU For a copy of the presentation or questions, email davidchiu@gamestop. com or come by the Kongregate booth in the Silver Sponsors room (Table#5) For more talks & data visit developers. kongregate. com For web games contact us at apps@kongregate. com If you’re interested in mobile publishing it’s mobile@kongregate. com Follow us on Twitter: @Emily. G & @Kongregate. Devs