1. Business Model of Social Games
TIGA Event - Casual Games Meetup
(2012-Jan-25)
Gerald Tan
Co-Founder, COO (Head of Product)

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4. GERALD TAN
Co-founder, COO (Head of Product)
Plumbee
Strategic Advisor Hooplo Media 2011
Independent Consultant 2011
Senior Product Manager / Producer Playfish (EA) 2009-2011
Finance and Business Manager Pogo.com and EA Online
Publishing (EA) 2007-2009
Financial Reporting and Control Manager EMI Group PLC
2004 - 2007
ICAEW Qualified Chartered Accountant
2002
gerald@plumbee.co.uk
Twitter: @tan_gerald

5. Each key metric is connected
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6. Right
benchmarks
is essential
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7. Different Business Models
Subscriptions Freemium + Lite Freemium
Advertising +
(Display) Microtransactions
Freemium + MTX : Most effective business model
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8. Definitions Uses
Freemium: Freemium:
- use for free but premium - low barrier entry point
content chargeable
Microtransactions: Microtransactions:
- virtual items purchasable - pay according to what
for small amounts of “perceived” value is
real currency
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9. Users

10. Social Games
Mobile Games
Source: Mashable, Oct 2011 10

11. Funnel
Reach size of audience
Acquisition + Liquidity adding audience
Retention keeping audience
Spenders converting to spenders
Revenue bottom line

12. #1 Reach
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13. Reach
Reach
Acquisition + Liquidity
Retention
Spenders
MAU and DAU Revenue
Differs by genre
Resources Mgt Casual Gaming / Casino
• DAU big ranges (Cityville • “Real game mechanics” • “New-ish” category
peaked at 100M, • Light and easy to get • Slotomania (1.7M),
Millionaire City 2.5M, into - casual player DoubleDown Casino
Restaurant City 5M) • Bubble Witch Saga (1.1M), Bingo Blitz (0.9M)
• Competitive genre – (4.2M DAU and rising) • High ARPDAU
most games are in this • Bejeweled Blitz (peaked • Older female skew
category at 4.6M)
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14. #2 Acquisition and Liquidity
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15. Reach
Acquisition and Liquidity
Acquisition + Liquidity
Retention
Spenders
Revenue
Paid Installs
• As low as $0.1 to start
• $1 to $3 depending on segments
• Auction based platform
• Scale and spend is punished
Viral Installs
• k-factor ranges btw 10% to 25%
• Good social games with strong
viral hooks can be very high at start
• Reach close to peak within 3 to 4
months 15

16. #3 Retention
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17. Reach
Retention
Acquisition + Liquidity
Retention
Spenders
Revenue
Retention rates
• Day 2 retention rates is crucial
• Good games retain 35% to 40%
• Overtime quality installs drops
• Retention by level and on-boarding
drop offs to prevent lapsing users
Newbies and Veterans
• Day 3 - 7, D14, D21, D30, D60 –
there is a difference between
newbies and veteran retention
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18. Newbie + Veteran Average Retention
Decay curve of a social game
Only 35% and 45% of users
% returning users
Veterans
actually come back the
next day
Newbies
The rest lapse out
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19. #4 Spenders
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20. Reach
Spenders
Acquisition + Liquidity
Retention
Spenders
Revenue
Metrics
• Small % of spenders ( <5%)
• Depends on the product offering
• By genre ARPDAU is different
Price
$50 Small % of spenders will
generate most of the
$20
revenue
$5
$1
1% - 5% 95%+ No of users
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21. #5 Revenue
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22. Reach
Revenue
Acquisition + Liquidity
Retention
Spenders
Revenue
DAU ARPDAU
Conversion
DAU rate
Spenders
Spenders ARPPU
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23. Reach
Revenue
Acquisition + Liquidity
Retention
Spenders
Revenue
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25. Gerald Tan
gerald@plumbee.co.uk
twitter.com/tan_gerald
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