The Future of Monetization?<br />Driving Game & Content Development<br />Elvin Li<br />Founder & CEO<br />Ryan Lou<br />Bi...
About ZelRealm<br />Commerce Tools for Social Game Developers<br />Analysis<br />Monetization<br />Virtual Goods Managemen...
Is this a cheat sheet?<br />
Breakdown<br />
Maturity of gaming niches<br />Over expectations<br />Social Games<br />Steady growth<br />MMOGs<br />Mobile games<br />PC...
What’s Hot: Freemium<br />Micro-Transactions: <br /><ul><li>Virtual Goods
 Virtual Currency</li></li></ul><li>Did you know? Monetization<br /><ul><li> Virtual Items
Virtual Currency
Brand sponsorships
Premium features
Virtual Gifting
Integration with real world transactions
 Tradable currency
Subscription
Pay for time
Peripheral Enticement
 Selling Branded Items from your site
 Retail (bricks & mortar)
Digital Distribution
In-Game Advertising
Around-Game Advertising
Advertgames
Try Before you Buy
Episodic Entertainment
Skill-Based Progressive Jackpots
Velvet Rope or Member's Club
 Foreign distribution deals
 User Generated Content
 Pay for Storage Space</li></ul>http://news.cnet.com/8301-13846_3-9983073-62.html<br />
What’s Hot: Hybrid Model<br />Micro-Transaction<br />+ Subscription<br />+ Immersive Brand Advertising<br />+ Metered Syst...
My Background<br />Monetization<br />
Understanding Monetization<br />(Lifetime Value – User Acquisition Costs) <br />x scale = Profit<br />Credit: Siqi Chen (S...
Understanding Monetization<br />(Lifetime Value – User Acquisition Costs) <br />x scale = Profit<br />Credit: Siqi Chen (S...
Understanding Monetization<br />(Lifetime Value – User Acquisition Costs) <br />x scale = Profit<br />Credit: Siqi Chen (S...
Understanding Monetization<br />(Lifetime Value – User Acquisition Costs) <br />x scale = Profit<br />Credit: Siqi Chen (S...
Understanding Monetization<br />(Lifetime Value – User Acquisition Costs) <br />x scale = Profit<br />Credit: Siqi Chen (S...
Reducing leakages<br />Make it simple to learn<br />
Reducing leakages<br />
Reducing leakages<br />Yes, You need to make money<br />Use Analytics<br /><ul><li> ARPU
Virality
 Entry/Exit
 Revisit rates
 Conversions</li></li></ul><li>Getting ‘em addicted<br />4 stages of addiction<br />Experimental stage <br />Recreational ...
Getting ‘em addicted<br />
The social gaming industry<br />	Predictions<br />Growing industry (like blogging before)<br />Where’s the innovation?<br ...
Why Free To Play?<br />Symptom of worldwide recession<br />Users as a KPI (Funding / Acquisition) <br />Bigger upside<br /...
Excuse me, are you a gamer?<br />
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Future of Monetizing Social Games

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The future of social game monetization and the revolutionary change to observe and look out for.

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  • Elvin’s slide
  • Elvin’s slide (What we do)
  • Overall, users under 25 make up 72.5% of all Facebook users in that country, with more women in the younger categories than men.But, men make up most of Facebook’s Indonesian users. What age group are do most of them fall into? A large percentage of men fall in to the 26 – 34 age group, with a sharp dropoff after that.Notably, older demographics barely register a blip, with users over 35 making up just 8.9% of the total userbase.http://www.insidesocialgames.com/2010/06/09/whos-using-facebook-around-the-world-the-demographics-of-facebooks-top-15-country-markets/
  • Listed above, you can see the top five individual spenders within Social Gold’s network. According to the company, most whales are “pretty single-minded” — meaning that you can assume most of them spent their money in a single, beloved game. And to give perspective, we’ve included the average for all spenders.The amount these leading whales are paying out looks pretty shocking, but whales are not strictly a new phenomenon. Before social gaming took off, there were casual game players spending profligately on their favorite titles; for instance, several years ago Andrew Busey of Duels.com (now part of Challenge Games, which just got bought by Zynga) told me that his game had attracted a set of hedge fund employees who competed to out-spend each other, paying over a thousand dollars each for armor and weapons.
  • But social gaming on Facebook has rocketed the casual market into the stratosphere, not only in terms of how many people are playing, but also in spending levels. What’s really surprising about the above figures is not just that someone would pay as much for virtual goods as they might spend on a new car, but that Social Gold tracked these five spenders over a period of just six months, since last November.
  • Multiple media,exchangable currencies
  • Future of Monetizing Social Games

    1. 1. The Future of Monetization?<br />Driving Game & Content Development<br />Elvin Li<br />Founder & CEO<br />Ryan Lou<br />Biz Dev Partner<br />Fiona Poh<br />Marketing Mgr<br />
    2. 2. About ZelRealm<br />Commerce Tools for Social Game Developers<br />Analysis<br />Monetization<br />Virtual Goods Management<br />
    3. 3. Is this a cheat sheet?<br />
    4. 4. Breakdown<br />
    5. 5. Maturity of gaming niches<br />Over expectations<br />Social Games<br />Steady growth<br />MMOGs<br />Mobile games<br />PC, Consoles games<br />Consolidation<br />
    6. 6. What’s Hot: Freemium<br />Micro-Transactions: <br /><ul><li>Virtual Goods
    7. 7. Virtual Currency</li></li></ul><li>Did you know? Monetization<br /><ul><li> Virtual Items
    8. 8. Virtual Currency
    9. 9. Brand sponsorships
    10. 10. Premium features
    11. 11. Virtual Gifting
    12. 12. Integration with real world transactions
    13. 13. Tradable currency
    14. 14. Subscription
    15. 15. Pay for time
    16. 16. Peripheral Enticement
    17. 17. Selling Branded Items from your site
    18. 18. Retail (bricks & mortar)
    19. 19. Digital Distribution
    20. 20. In-Game Advertising
    21. 21. Around-Game Advertising
    22. 22. Advertgames
    23. 23. Try Before you Buy
    24. 24. Episodic Entertainment
    25. 25. Skill-Based Progressive Jackpots
    26. 26. Velvet Rope or Member's Club
    27. 27. Foreign distribution deals
    28. 28. User Generated Content
    29. 29. Pay for Storage Space</li></ul>http://news.cnet.com/8301-13846_3-9983073-62.html<br />
    30. 30. What’s Hot: Hybrid Model<br />Micro-Transaction<br />+ Subscription<br />+ Immersive Brand Advertising<br />+ Metered System<br />+ ….<br />“Why get rid or alienate your current subscriber base?  Would you really cancel your current subscribers?” – LOGIN 2010, Fernando Paiz (DDO)<br />
    31. 31. My Background<br />Monetization<br />
    32. 32.
    33. 33. Understanding Monetization<br />(Lifetime Value – User Acquisition Costs) <br />x scale = Profit<br />Credit: Siqi Chen (Serious business)<br /> How long people play <br /> Conversion rates<br /> Game dynamics <br /> Marketing effectiveness<br /> Flow of game<br />Payments<br />
    34. 34. Understanding Monetization<br />(Lifetime Value – User Acquisition Costs) <br />x scale = Profit<br />Credit: Siqi Chen (Serious business)<br />Facebook killed virality<br />Typically Ads (US$1.50 per user) <br />Multiple Platforms<br />Cross promotion<br />
    35. 35.
    36. 36. Understanding Monetization<br />(Lifetime Value – User Acquisition Costs) <br />x scale = Profit<br />Credit: Siqi Chen (Serious business)<br />Same problems as Web 2.0<br />
    37. 37. Understanding Monetization<br />(Lifetime Value – User Acquisition Costs) <br />x scale = Profit<br />Credit: Siqi Chen (Serious business)<br />Is about managing trade-offs<br />
    38. 38. Understanding Monetization<br />(Lifetime Value – User Acquisition Costs) <br />x scale = Profit<br />Credit: Siqi Chen (Serious business)<br />Is about managing trade-offs<br />
    39. 39. Reducing leakages<br />Make it simple to learn<br />
    40. 40. Reducing leakages<br />
    41. 41. Reducing leakages<br />Yes, You need to make money<br />Use Analytics<br /><ul><li> ARPU
    42. 42. Virality
    43. 43. Entry/Exit
    44. 44. Revisit rates
    45. 45. Conversions</li></li></ul><li>Getting ‘em addicted<br />4 stages of addiction<br />Experimental stage <br />Recreational stage<br />Early dependency<br />Full Dependency<br />
    46. 46. Getting ‘em addicted<br />
    47. 47. The social gaming industry<br /> Predictions<br />Growing industry (like blogging before)<br />Where’s the innovation?<br />Every game will be social<br />
    48. 48. Why Free To Play?<br />Symptom of worldwide recession<br />Users as a KPI (Funding / Acquisition) <br />Bigger upside<br />Doesn’t require big spike<br />
    49. 49. Excuse me, are you a gamer?<br />
    50. 50. Who plays social games<br />
    51. 51. Demographics (ASIA)<br />Who Uses Facebook? The Asian Context<br />CASE: INDONESIA<br />
    52. 52. Compared to US: More males use Facebook than females (18.4% overall)<br />Male Age: 18-25 - 45.9%<br /> 13-17 – 23.5%<br />Overall: Users under 25 – 72.5%<br />More women in younger ages play Facebook compared to men<br />
    53. 53. Demographic (US)<br />average age is 48<br />90% reported the same or increased game play over the past 3 months<br />27% and 25% reported less time spent reading (mag, book, newspaper) and home TV/movie viewing respectively<br />43% of the time, game players log into social networks specifically to play games<br />friends’ recommendations are the #1 factor influencing social game selection<br />35% have purchased a virtual gift while playing a social game<br />
    54. 54. Gifting<br />
    55. 55. VS<br />
    56. 56.
    57. 57.
    58. 58. Social Whales<br />Players who spend massively on virtual goods and gifts<br />Whale: > USD$1, 000Super Whale: > USD$10,000<br />Mafia Wars, Happy Aquarium etc<br />Small percentage (10%) of users in the category<br />Single minded<br />
    59. 59. TOP SPENDER : SAUDI ARABIA<br />
    60. 60. Facebook phenomenon<br />Increased number of people using social media<br />Increased number of people playing social games too<br />
    61. 61. Facebook phenomenon<br />Increased number of people using social media<br />Increased number of people playing social games too<br />
    62. 62. Future of Social Game<br />Spending on social games is open –ended<br />Assumption: even LARGER whales<br />Larger spenders <br />No extreme spending foreseen<br />
    63. 63. The future?<br />
    64. 64. Future of monetization<br />Consolidation<br />Socializing<br />
    65. 65. Future of monetization<br />Remember this?<br />
    66. 66. Future of monetization<br />
    67. 67. Future of monetization<br />Selling IP<br />Selling Users<br />
    68. 68. Future of monetization<br />
    69. 69. Future of monetization<br />
    70. 70. Future of monetization<br />
    71. 71. Future of monetization<br />
    72. 72. Lessons: Relevance<br />
    73. 73. Lessons: Relevance<br />Ask more questions to understand your audience<br />
    74. 74. Lessons: Test TestTest<br />Ad models<br />Marketing methods<br />Promotions<br />Email methods<br />PPA<br />PPC<br />Word of mouth<br />PR<br />Video marketing<br />PPM<br />Expect the unexpected<br />Monetization models<br />Brand engagement<br />Freemium<br />Inter-operability<br />Virtual items<br />New markets<br />

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