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F2p foundations II and OOC issues


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f2p online games need more than just a game on launch. This talk tells you about the things outside the game you need like community management, support, metrics, payment systems and more

Published in: Entertainment & Humor

F2p foundations II and OOC issues

  1. 1. Virtual Economies<br />by TeutWeidemann<br />Consultant Online Entertainment<br />Please do not put online for download without my permission. If you use parts of this presentation please quote me as the source<br /><br />Free to Play Games<br />
  2. 2. Who is Teut Weidemann<br />Working on Games since 1981<br />Professional since 1987<br />Over 70 titles on C64, Amiga, Atari ST, PC, Consoles, Online …<br />Specialised since 1996 on online games<br />Jobs: Graphic Artist, Programmer, Designer, Development Director, CEO, CTO<br />Now consultant for Online Formats<br />Also teacher at Film Academy Ludwigsburg<br />Companies: Rainbow Arts, Softgold, Lucasfilm Games, Microsoft, Wings Simulations, Jowood, CDV, UBISoft<br />
  3. 3. Teut‘s Oldies … 1987-1990<br />Katakis, Denaris, Turrican, Spherical, X-Out, MUDS, R-Type, Rock’n Roll, 60 more<br />
  4. 4. My „Serious Games“ …<br />Andsomemore …<br />
  5. 5. Teut‘s Classics … 1997-2009<br />And 20+ more<br />
  6. 6. Teut‘s New … 2010 - ????<br /><br /><br /><ul><li>The Settlers Online for UBISoft/Bluebyte
  7. 7. Nadirim for Digital Reality/Docler in Hungary
  8. 8. Both free to play
  9. 9. Both browser based, Flash/Flex ‘client’ </li></li></ul><li>The Settlers Online<br />
  10. 10.
  11. 11. Monetization Strategies<br />Making money with a free game<br />“f2p never works in europe”<br />Unnamed CEO of <put name here> Publisher<br />2005<br />
  12. 12. Definition: Classic Business<br />Retail Sale<br />Buy before you play<br />Reviews, Demos as guidelines<br />Risk of returns<br />Very indirect customer feedback<br />System Specs sensitive<br />
  13. 13. Classic Market<br />
  14. 14. No costs involved<br />free game download<br />or free access via browser<br />try before you commit: no costs involved<br />Low entry barrier<br />Usually low system specs<br />Majority are online games (MMO)<br />Free to Play (=f2p)<br />
  15. 15. Some Foundations<br />13<br />F2p Business Overview<br />
  16. 16. Business model<br />Unlimited free play<br />Dual currency system:<br />“Coins” are earned by game mechanics<br />“Gems” are bought for real money<br />Coins are used for trade and production<br />Gems can be spend in the item shop<br />„Achievements“ earn gems too (fair play)<br />
  17. 17. Soft Currency<br />Part ofyourvirtualeconomy<br />Earnedbygamemechanics<br />Quests<br />Achievements<br />Monster kills<br />Spend on gamemechanics<br />Repairs<br />Trade<br />NPC sales<br />Will beaffectedbyinflation on elderservers<br />Is not convertableintohardcurrency<br />
  18. 18. Hard Currency<br />Boughtwith real money<br />Earned in verysmallquantities<br />Quests<br />Achievements<br />Monster kills<br />Spend on virtualitems<br />Itemshop<br />In Game Monetizers<br />Services & Comfort<br />Only „drops“ influenceseconomics<br />Is sometimesconvertableinto soft currency<br />
  19. 19. Why 2 Currencies<br />Business depends on hardcurrency<br />Should not bepronetoinflation<br />Userbaseischaoticsystem, don‘tdependyourbusiness on it<br />Drop Rates & Sales are 100% controlledbyyou<br />Metricskeytosuccess: hardcurrencyhastobetracked 100% andid‘edaccordingly<br />Note: global currencyfor all games = badidea<br />Thatswhy Facebook Creditsmight hurt thebusiness<br />Ithappened in thepast (Compuserve vs. Genie vs. AOL)<br />
  20. 20. Its not as easy as it sounds<br />But its all out there<br />Google is king<br />18<br />Hard Currency Sales<br />
  21. 21. This is how its done*:<br />19<br />* If you do it different you do it wrong<br />Image from<br />
  22. 22. $ Packages<br /><ul><li>2,5,10,20,50,99€ packages
  23. 23. Scaled hard currency amount
  24. 24. List advantages of larger packages
  25. 25. Show older expensive prices
  26. 26. Do not page/scroll
  27. 27. 3 click buying process</li></ul>This fits even 800x600!<br />20<br />Image from<br />
  28. 28. Payment Options<br /><ul><li>Depending on choice they witch
  29. 29. Depending on country they change
  30. 30. Not all options are available:
  31. 31. 1.99€ is SMS only
  32. 32. 4.99€ can be T-Pay only
  33. 33. Reason: Costs of payment system influence your packet sizes
  34. 34. Adding payment systems doesn’t cannibalize others!</li></ul>The more the merrier!<br />21<br />Image from<br />
  35. 35. Other stuff<br /><ul><li>Country selection
  36. 36. People do travel!
  37. 37. Note the https symbol
  38. 38. Progress indicator
  39. 39. Other options
  40. 40. Friend invites
  41. 41. Link to Payshop
  42. 42. Explanations
  43. 43. Other services
  44. 44. Service & Faq
  45. 45. Users have to TRUST your shop & service to pay!</li></ul>The small stuff<br />22<br />Image from<br />
  46. 46. 23<br />Integrate into webpage!<br />No pop up!<br />Not inside flash!<br />https!<br />This is a service page!<br />No advertising!<br />Less clicks=win<br />3 clicks maximum<br />Each additional click costs you 30% users!<br />Metrics!<br />Metrics!<br />A/B Tests<br />Image from<br />
  47. 47. Payment Systems<br />Eachcountryhasfavouriteones<br />Eachcountryhasspecificones<br />Addingpaymentsystems do not cannibalizeothers<br />Support iskeytosuccess<br />Thatswhy:<br />Yourproviderhastobe in the same timezone<br />Hastobe flexible withthe UI (noreadymade box)<br />Hastobe international (Europe, Eastern Europe)<br />(in otherwordsdon‘tuse US onlyproviders)<br />
  48. 48. FREE Advice!!!!<br />UseGlobal Collectformostpaymentoptions<br />UseMoPayfor SMS payments<br />UseInFinforLandlinePayments<br />Thatsit!<br />Covers 95% marketandareprovenexperts<br />Europe, RussianTerritories, Arabian Countries, Turkey, etc.<br />Theyaren‘tthecheapest, but thats not important!<br />Service is!<br />
  49. 49. Definitions<br />26<br /><ul><li>Churn Rate: how many leave per month
  50. 50. Reg to Active: How many play* after registering
  51. 51. *Active User Definition: returning after first day and first login, definition varies
  52. 52. Active to Pay: How many actives pay = Conversion Rate
  53. 53. ARPU: Average Revenue per User (total revenue/active users)
  54. 54. ARPPU: Average Revenue per Paying User (total revenue/paying users)
  55. 55. CPA/CPL: Cost per Acquisition/Lead (of user)
  56. 56. LTV: Lifetime value (total revenue per paying user over his lifetime)
  57. 57. PCCU: Peak Concurrent Users
  58. 58. MAU/WAU/DAU: Monthly/Weekly/Daily active users</li></li></ul><li>User Flow<br />Visitors<br />Churn Rate<br />Registered<br />Active<br />Conversion Rate<br />Pay Users<br />
  59. 59. Revenue Distribution<br />50% ofyourrevenuecomesfrom „highrollers“ or „wales“<br />Total Revenue<br />These Users needspecialattention<br />90% of<br />Pay Users<br />10% of<br />Pay Users<br />„VIP“ flagneededthrough all services<br />
  60. 60. Number of users is key to success<br /><ul><li>Revenue = Active Users*Conversion Rate*ARPPU
  61. 61. Printing Money?
  62. 62. If ARPPU or LTV > CPA of paying users</li></li></ul><li>Market Size & Forecast ARPU(!)Source: IDATE Sept. 2008<br />
  63. 63. Sample Business Case<br />1 Million registered users<br />Reg to Active: Churn rate varies (we assume 60%)<br />400.000 Users left<br />Rule of Thumb: 5%-15% Users pay<br />5%: 20.000 paying users<br />15%: 60.000 paying users<br />ARPPU 15€: 300-900 thousand/month (ARPU: 0.75-1.5€)<br />ARPPU 30€: 600-1.8Mil per month (ARPU: 2.25-4.50€)<br />
  64. 64. User Attributes<br /><ul><li>Anonymous
  65. 65. Can leave anytime (low stickyness)
  66. 66. Usually brings 0.5-2 friends with him (6-8 on Facebook)
  67. 67. Once he pays, he pays even more (package selection)
  68. 68. Payingusersspendhardcurrencywithindays
  69. 69. Most users come from countries we are not used to make business in:
  70. 70. Low average income
  71. 71. Low or evolving internet infrastructure
  72. 72. Low system specs
  73. 73. Can’t afford PC or consoles
  74. 74. Usually play in internet cafes</li></li></ul><li>Browser Game Countries<br /><ul><li>Turkey
  75. 75. UAE countries
  76. 76. GUS states
  77. 77. India
  78. 78. Brasil
  79. 79. China
  80. 80. Poland
  81. 81. Phillipines
  82. 82. Malaysia</li></li></ul><li>Consequences<br />Low System Specs & Software requirements<br />Localization (or better Culturization) important<br />Successful f2p gameslocalizeinto 25+ languages<br />Thatswhere US companies FAIL<br />Game Content compatible with alien cultures (Muslim, Asian)<br />No pigs, cows, alcohol, owls, events on Christian holydays etc.<br />Free to play with item sale model (not fremium)<br />Special payment systems<br />Specifics of Turkey (ePin), Russia (no CC, no accounts) <br />
  83. 83.<br />35<br />Monetization Strategies<br />Basics<br />Examples<br />Oddities<br />
  84. 84. Item Sales: Overview<br />In game economy required<br />Monetization by player motivation:<br />Players Game Progress<br />7 ‘Sins’<br />Online Role Behaviour<br />Item Types<br />Retention Strategy (pursue the player to come back)<br />Examples<br />
  85. 85. Monetizetheplayerbyprogression: Acts<br />Act3: End Game <br /><ul><li>Elite Items
  86. 86. Super Powers
  87. 87. Rare Items</li></ul>Act2: Mid Game <br /><ul><li>Comforts
  88. 88. Specialization
  89. 89. Leveling
  90. 90. Socialization</li></ul>Act1: Early Game <br />Time Accelerators<br />Startup helps<br />Power buffs<br />Monitoring the player: Best buy offer for his current needs<br />
  91. 91. Monetizetheplayerbythe 7 sins<br />Vanity: Showing off socially/posing<br />Envy: Desire for friends Possession<br />Gluttony: Consume more<br />Lust: Instant gratifications<br />Anger: Wrath on enemies<br />Greed: Virtual Wealth<br />Sloth: Avoidance of work<br />
  92. 92. Monetizetheplayerbyplaying style<br />Challenger: Fast Leveling, Achievements, “Raids”<br />Trader: Master Trader, Auction House, Resources<br />Explorer: Maps, Exclusive Access, Easter Eggs<br />Slayer: Better units, faster reactions, comfort battle UI<br />Socializer: Gifting, Decorations, Customizations<br />Note: Players switchroles all the time!<br />Note 2: Ifyourgamedoesn‘tsupport all rolesyousufferrevenue<br />Source: MMO Archetypesby Richard Bartle<br />
  93. 93. Item Sale Types<br />Permanents: <br />last forever<br />May have cool downs<br />expensive<br />Consumables: <br />vanish after use<br />one time buff or help <br />Cheap<br />ImmediateMonetization Actions<br />Game hasdirectaccesstomonetizationactionsrightatthemomentwhenneeded<br />Comfort: monthly premium services ok, but limits ARPU<br />Rent: pay per use/day: not a good idea (time pressure on user), only works for long term rents<br />
  94. 94. Processof Design Items<br />Every gamemechanicshouldbethoughtabouttomonetize<br />Makelistofplanneditemsandactions (! Note thedifference!)<br />Attachattributesfor all 3 pillarstoeach item oraction<br />Fill in newitemstolessoccupiedcolumnsforthe 3 pillars<br />Makeexperimentsforlight, medium and heavy spenders<br />Adjustpricesand total gemsspend<br />Comparehardcurrencyspendswithyourcurrencyprices<br />Adjust – Test - Readjust<br />Source: MMO Archetypesby Richard Bartle, notethatplayerschangethoseroles all the time!<br />
  95. 95. ProcessofResearching Items<br />Play hugelysuccessful f2p games, i.e. Metin 2, Dark Orbit, Grepolis<br />Makeexcellistof all theiritems in shopandsortthemto 3 pillars<br />Makelistof all payedactionsandputthemtheretoo<br />Don‘tforgettheirpricing<br />Repeat for Runes of Magic, Seafight, Farmerama etc.<br />Compare<br />Askyourself WHY each item works<br />Watch item shopsfornewitemsandseasonal/eventitems<br />
  96. 96. Player Retention Strategy<br />Daily Retentions<br /><ul><li>Build queue
  97. 97. Daily Offers & Bonus
  98. 98. Production limits
  99. 99. Specialists usage</li></ul>Hourly Retentions <br /><ul><li>Building construction
  100. 100. Gifts & Friends
  101. 101. Chat & Communication</li></ul>Weekly Retentions <br /><ul><li>Rare & Event zones
  102. 102. Building upgrades
  103. 103. Combat</li></ul>Monthly Retentions <br /><ul><li>Wild Zones
  104. 104. Alliances & Guild Wars
  105. 105. Expansions</li></li></ul><li>Requirements<br />Pricing Strategy: double your initial thoughts<br />Lowering prices is easy (and actually is a good marketing tool)<br />Raising prices is hard<br />Think about item power when pricing them: <br />how much does it give? <br />Save time? <br />Increase luxury? <br />Value that to the hard currency earnings per hour<br />Accelerated costs in game vs. deaccelerated costs when buying<br />Mask real price by odd exchange rates<br />Make sure left overs are there when user spends all his money<br />Make sure your monetization strategy allows high spending<br />
  106. 106. Oddities in Monetization<br />Orwhy ist the Wild West out there<br />(wordingby Dave Perry)<br />The followingitems<br />Are<br />All<br />Best Sellers!<br />45<br />Odd Examples<br />
  107. 107. Item Attributes<br />Metin 2 Wedding Ring<br />Allowsclosersocializationwithoneplayer<br />Offersadvantageslikemore XP, teleportationtopartner etc.<br />Divorcecoststentimesasmuch<br />46<br />Wedding Ring<br />
  108. 108. Item Attributes<br />Shit<br />Allowstothrowit on otherplayers<br />Everyoneseesyoudirty<br />Cleaningtakes a daysor …<br />… a pay item ;)<br />47<br />Shit<br />No picture given ;)<br />
  109. 109. Item Attributes<br />Mute button<br />Allowsto mute a playerfromchatfor 24h<br />Everyonesees YOU didit<br />Savesmoderators<br />Andtheusersevenpayforit!<br />48<br />Mute<br />
  110. 110. OOC<br />Hereiswheremostdevelopersfail<br />by<br />Underestimation<br />49<br />Out of Client Modules<br />
  111. 111. Landing Pages<br />50<br />Various LP’s for various countries, Biz Dev partners or markeitng events<br />Ultra fast Loading speed<br />Advertises what your game is all about<br />In VERY short steps<br />Task: Lead user to register<br />
  112. 112. Community Pages<br />51<br />Localized CP’s<br />Requires CMS (!!)<br />Imagine posting to 25 languages<br />At the same time<br />Service Portal!<br />Here you communicate to active users<br />No Flash! (loading times)<br />No sound! (office browsers)<br />No Advertising! (but your own)<br />Task: engage the users within your community<br />
  113. 113. Forum<br />52<br />Use industry standards<br />i.e. vBulletin, nothing else<br />Forum Web Server and DB Server on their own machines<br />Establish a common login for game & forum<br />Forum CM is not as easy as it sounds!<br />
  114. 114. Community Management<br />53<br />Is NOT support!<br />Lead CM must sit in your offices<br />Honest, direct, immediate communication to your users is KEY<br />Even if its bad news<br />Train your CM<br />he is worth thousands of marketing dollars!<br />
  115. 115. Payment Systems<br />54<br />Support as many as possible<br />Research what big (European) companies support<br />Do not underestimate this point<br />Secure transfers<br />Rollbacks<br />Accounting<br />Fraud<br />P.s.: Bigpoint has 160+ payment systems online<br />
  116. 116. Support<br />55<br />Ticket System<br />Rights system<br />Intl. support<br />Support actions<br />Reimburse items<br />Check player game status<br />Check player payment status<br />Check player support history<br />Includes bans, mutes, etc.<br />Support actions needs to logged<br />Knowledge base key<br />Other problems needs to be escalated<br />
  117. 117. VIP Support<br />56<br />Ticket System auto priorizes VIP’s<br />Turn around time less than 12 hours<br />VIP’s receive special treatment<br />See Pokersites, they do this since years<br />Btw, Wales, ask Zynga …<br />
  118. 118. Maintenance & Monitoring<br />57<br />Prevent downtime<br />Every hour DT costs €<br />Altert system to your IT staff 24/7 (pager, sms etc.)<br />Do not think your provider can do this<br />Most problems are software based<br />Most problems occur when you’re out of office (Murphies law)<br />
  119. 119. Maintenance & Update Deployment<br />58<br />Fixed Maintenance day<br />Wednesdays (or Thursdays)<br />Mo-Tue is a bad idea, Fr is even worse<br />Do not underestimate time needed for deployment<br />Deployment strategy is KEY for stable versions<br />Without Perforce you WONT be able to do this<br />
  120. 120. Life Team – Dev Team<br />59<br />Life operations draws time<br />You won’t have time for other stuff<br />i.e. further development<br />So you need 2 teams<br />Shared resources are ok<br />Sizes vary over time as game matures<br />Do not underestimate requirements & demands from<br />Marketing, BizDev, Support, Community Management, Users, IT<br />
  121. 121. Business Development (BizDev)<br />60<br />Sells your game to media<br />But you operate it<br />On your servers<br />White labeling needed<br />BizDev can generate millions of users<br />Deals vary from CPA/CPL to lifetime share<br />BizDev partners do not cost money initially! <br />They are only payed on success<br />
  122. 122. E-Marketing<br />61<br />Your key to acquire users<br />Traditional marketing won’t work<br />Banners are out<br />Forget magazines<br />You can acquire users without leaving your offices – world wide<br />SEM, SEO is key<br />
  123. 123. Player retentionstrategy: Updates & Expansions<br />Plan for bi-weeklyupdates<br />Major expansionsevery 1-2 months<br />usingslicedeconomics*<br />High update frequencymeans<br />2 Teams: Life & expansionteamneeded<br />High Performance Version Control (Perforce)<br />Users needtoseethe „service“<br />Mini Expansionsweekly (items, events)<br />Ever expanding game means users will stay<br />Be careful however with major gameplay changes<br />As users always will complain<br />
  124. 124. Hacks & Exploitation<br />Players will find potential exploits, all the time<br />They exploit as its „just“ a game<br />Guaranteed - at 70k active users<br />It will harm your business<br />So you need to protect yourself<br />Process needed<br />Alert System needed<br />
  125. 125. Q & A<br />Contact me: <br />on Facebook<br />or Twitter (Teut)<br />or LinkedIn<br />or Xing<br />or ... simply<br />