Nicholas Lovell presented on the importance of metrics for social game development. He discussed key metrics like MAUs, DAUs/MAUs, retention rates, conversion rates, and the importance of the power law distribution for user spending. Lovell provided example metrics for popular games and emphasized using metrics to prioritize game improvements rather than focusing on absolute numbers. He also introduced a spreadsheet tool to help analyze metrics and make informed decisions about acquisition, retention, and monetization.
7. 25 Add friction
• Game design is about taking
friction out
• Freemium design is about
adding friction
• GOOD fremium design is
about finding a balance – just
enough friction to encourage
some players to pay, without
ruining it for the rest of us.
12. What is the point of metrics?
• To connect game development and the
finances of making games
• To teach you about your players and your
game
• To help you make better decisions
KEEP IT SIMPLE
14. Beware vanity metrics
• A metric that can only go up is not useful
– Registered users is a particular culprit
– Yes, I’m looking at Bigpoint
• A metric that can’t be affected is not useful
– Track percentages, not absolutes, for quick results
• Vanity metrics impress dumb VCs and the
press
– But they don’t help you run your business better
16. 1 Feed the funnel
• To build a successful games
business, you must feed the
funnel
• Potential customers arrive at
the top. In the middle, you
convert them to payers.
• At the bottom, they become
long-term, high-spending
customers.
17. 2 ARM yourself
• A successful online game
must Acquire users, Retain
them (usually
overlooked!), and Monetise
them.
• All three aspects must be in
harmony.
• You need all three to build a
successful long-term
business.
18. 8 Avoid the leaky bucket
• Acquiring customers is both
hard and expensive.
• Once you get them, focus on
retention to keep them.
• Don’t worry about getting
new customers until you can
satisfy the ones you’ve got!
19. 3 Make it free AND expensive
PRICE
Revenue opportunity
Marketing opportunity
Demand
• Giving your content away for free is a marketing
opportunity.
• You have to find your revenue opportunity.
• Draw customers along the curve by offering them
things they truly value.
23. 6 key metrics
• MAUs
• DAUs/MAUs
• Retention rate
• Conversion rate
• Split into whales, dolphins, minnows
– ARPU
• Oh, and I have platform share but it’s not a metric
24. MAUs
• I start with 200k MAUs – an ESTIMATE
• If I were being more accurate, I would model
customer acquisition costs.
– Maybe in version 2.0
• You won’t get a sizeable audience without spending
money
– CPI on Facebook is $1.00 to $1.50, some say more
– Fiksu quoted $1.81 at Christmas 2011, down a little now
• BUT audience isn’t your primary measure of success
– Find a small, niche audience with great
retention, conversion and ARPU
– Stop thinking like traditional media
25. DAUs/MAUs
• Also known as engagement
• Bizarre stat
• Driven by what Facebook chooses to publish
• Odd result:
– MAUs easier for financial results, long term planning
– DAUs drive monetisation, more accurate snapshot
• Target: 0.15 (aka 15%)
• Ratio fell steadily through 2011
– Trip Hawkins said “FB games are shallow”
– I said “its just the summer”
• Facebook’s changes in 2011 bumped the
engagement ratio up again
26. Facebook engagement
Game Publisher MAUs DAUs DAUs/MAUs
1 Scrabble Gamehouse 330,000 130,000 0.39
2 Bejewelled Blitz PopCap 9,700,000 3,200,000 0.33
3 Pioneer Trail Zynga 3,500,000 910,000 0.26
4 Mafia Wars Zynga 1,600,000 400,000 0.25
5 Diamond Dash wooga 18,900,000 4,300,000 0.23
6 Treasure Isle Zynga 930,000 190,000 0.20
7 Farmville Zynga 22,400,000 4,500,000 0.20
8 The Sims Social Electronic Arts 15,500,000 3,000,000 0.19
9 Frontierville Zynga 360,000 60,000 0.17
10 Pet Society Playfish 5,000,000 830,000 0.17
11 Social Empires Social Point 6,100,000 940,000 0.15
12 Millionaire City Digital Chocolate 1,700,000 250,000 0.15
13 Empires & Allies Zynga 10,900,000 1,400,000 0.13
Source: Appdata
27. Retention rate
• I have an sighting estimate of 75%
• Churn rate = 1 – retention rate (i.e. 25%)
• Duration = 1 / churn rate (i.e. 4 months)
• Zynga has a duration of < 2 months.
• Very hard to get accurate benchmarks for retention
• My view: 75% is not average, it’s great.
• NOTE: Where you calculate retention from makes a
difference.
29. 6 Acquisition lasts longer than you
think
• The Acquisition process doesn’t end when I click
“install”!
• 20 million people every month take a look at Cityville
– and never return!
• You haven’t got a customer until they spend 20
minutes playing. Make sure those first 20 minutes
are your best stuff!
30. Conversion rate
• Should I look at it daily or monthly?
• I use daily
• When looking at benchmarks, try to work out what
conversion rates they are using:
– What percentage of daily users spent money?
– What percentage of monthly users spent money?
– What percentage of all users have ever spent money?
• Tiny Tower: 3.8% of users in the first six weeks
• ngMoco: 2% of DAUs
• Jetpack Joyride: 5-10% ever
• Temple Run: 1% of users
• Anything from <1% to around 20% is feasible
31. Whales, dolphins, minnows
PRICE
Revenue opportunity
Demand
• An approximation of the power-law
• Minnows: spend the minimum ($1), 50% of spenders
• Dolphins: a “middling amount” ($5), 40% of spenders
• Whales: spend a lot ($20), 10% of spenders
32. The importance of the power law
Revenue
($) (%)
Whales $ 36,000 44.4%
Dolphins $ 36,000 44.4%
Minnows $ 9,000 11.1%
Gross revenue $ 81,000
• Whales are 0.5% of your users; 44.4% of your revenue
• 89% of your revenue comes from your higher spenders
• Across the whole business:
– ARPU: $0.41
– ARPPU: $4.50
34. DISCLAIMER
• Your business will not look like this.
• You will not make $2,946,789 in year one
• Do not rely on this spreadsheet as an accurate
financial predictor
35. The practical use
• All game developers have too many ideas to
improve their game
• You need to prioritise
• Use the GAMESbrief spreadsheet to get a
snapshot of the headline areas of
Acquisition, Retention, Monetisation
• Identify which are below benchmark
• Work on those areas for the next sprint
• Move on
• Repeat
36. Conclusion
• You need metrics to make a successful F2P game
• They are useless unless you use them to make
informed decisions
– And then act on them
• It doesn’t even matter if my spreadsheet is right:
look for the improvement over time, not the
absolute number
• If the spreadsheet doesn’t fulfil your needs, change it
• (And if you want to, send it back to me, or tell me what you’ve
changed)
37. 26 Pre-register for the book
o http://www.gamesbrief.com/52-game-idea-bombs/
o THANK YOU FOR LISTENING
38. Thank you
nicholas@gamesbrief.com
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