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Mike Hines, Amazon
The document discusses the significance of power users in mobile gaming and their impact on revenue generation. It highlights that a small percentage of highly engaged users contribute disproportionately to sales and emphasizes the importance of understanding their spending behavior and emotional connections. The document also outlines strategies for app developers to engage and retain these users by fostering emotional connections and providing a variety of offerings.
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Mike Hines, Amazon
- 1. @MikeFHines MobileDevMikeHines UNDERSTANDING YOURPOW ER -USERS AND GETTING MORE MIKE HINES D E V E L O P E R E V A N G E L I S T, A M A Z O N
- 2. A B OU T M ike Hin es Amazon Appstore @MikeFHines Founder @ 2 Financial Services Startups Founder @ 2 Software Startups QA Engineer @ Now Software QA Manager, Product Manager @ Microsoft Evangelist @ Amazon.com Mentor @ GameFounders, Dev Bootcamp Games Judge @Casual Connect Indie Prize, White Nights, and Pocket Gamer Very Big Indie Pitch Speaker @ GDC, GDCE, Casual Connect, Pocket Gamer Connects, AnDevCon, White Nights, CES, PAX Dev
- 3. iPHONEiPAD GOOGLE PLAY AMAZON 47.7%57.1% 36.5%64.2% 66.0% 26.3% 7.7% SHARE OFMOBILE GAME SPENDERS PER APPSTORE US, UK, GER, FR 2014 LEVEL OF SPENDING AMONGST ALL MOBILE GAME SPENDERS PER APPSTORE US, UK, GER, FR 2014 56.3% 34.9% 8.7% 64.9% 28.2% 7.0% 58.1% 33.1% 8.1% % Minor Spenders % Average Spenders % Big Spenders © 2014 Newzoo | Source: Newzoo Data Explorer Source: Newzoo Trend Report Spotting The Mobile Spenders A M A Z O N R E A C H E S ( B I G ) S P E N D E R S B E S T
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- 5. P O WE R U S E R S : T H E V I TA L F E W WELL-KNOWN ACROSS INDUSTRIES POWER USERS ARE NOT NEW M o b i l e G a m i n g i s n ' t t h e f i r s t i n d u s t r y t o r e c o g n i z e t h e i m p o r t a n c e o f h i g h l y e n g a g e d c u s t o m e r s .
- 6. P O WE R U S E R S : T H E V I TA L F E W SUBSTANTIAL SPENDERS SPEND ON THE THINGS T H E Y L O V E When it comes to th eir p assion ( wh atever it may b e) , power -users spend more mon ey th an th e average fan .
- 7. P O WE R U S E R S : T H E V I TA L F E W THE PARETO PRINCIPLE KNOWN EARLIER AS T H E 8 0 - 2 0 R U L E In 1941, Joseph M. Ju ran gen eralized th e con c ept of th e "vital few," which he n amed after V ilfred o Pareto .
- 8. P O WE R U S E R S : T H E V I TA L F E W WHALES, DOLPHINS, MINNOWS CASINO DEFINED COMMON TERMS Mon etization strateg y is segmented, based on different c u stomer exp erien c es at d ifferent p ric e p oints . F reemiu m: Min n ows = 9 0 -9 8 % of u sers Dolp h in s = 5 0 % of reven u e Whales = 3 -4% of paying users ( <0 .1 % total)
- 9. P O WE R U S E R S : T H E V I TA L F E W THE NUMBERS VARY, BUT… SEGMENTATION IS SIMILAR • Newzoo: 3.5% of U.S. mobile gaming customers generate 33% of sales • Google: 1% of U.S. customers generate 14% of monthly sales • Kongregate: 0.1% of U.S. customers generated 53% of all time sales Top 1% of customers who spend on mobile Sources: Google, Casual Connect July 2014; Kongregate, GDC March 2015
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- 11. A M AZ O N ’ S P E R S P E C T I V E THE VITAL FEW AND USEFUL MANY EVERY CUSTOMER HAS VALUE Non -spenders are important. Th ey can b e: • Potential p ower -u sers • Influencers and advocates • Eyeb alls for ad vertisin g
- 12. A M AZ O N ’ S P E R S P E C T I V E W H A L E I S P R E J O R AT I V E P O W E R U S E R V S . W H A L E Nicholas Lovell, author of The Curve, differentiates: • Ethical: Customer spends because they love what you do • Unethical: Customer spends because of who they are We prefer the term "power-user" to describe the avid hobbyist who loves your work.
- 13. A M AZ O N ’ S P E R S P E C T I V E AMAZON APPSTORE POWER USERS WHAT DO THEY LOOK LIKE TO US? • Spend $50/ month or more • O n average, sp en d >$ 2 0 0 / month • Are concentrated in US, Jap an , UK, an d Germany
- 14. A M AZ O N ’ S P E R S P E C T I V E F O C U S E D PA S S I O N POWER-USERS ARE LOYAL T O A F E W A P P S 80% of customers who sp ent $ 1 0 0 0 in Jan u ar y, 2 0 1 5 sp ent 75% ( or more) of that on ju st two titles.
- 15. A M AZ O N ’ S P E R S P E C T I V E CANDY CRUSH SAGA POWER-USERS LOVE ALL K I N D S O F A P P S MMOs are trad ition ally assoc iated with power -users, but King h as exp an d ed ou r view of wh at is p ossib le.
- 16. A M AZ O N ’ S P E R S P E C T I V E GAME OR WAR: FIRE AGE POWER-USERS LOVE ALL K I N D S O F G A M E S Similarly, Machine Zone h as h ad su c c ess in a comp letely d ifferent genre.
- 17. WHY SHOULD YOUCARE? 3
- 18. A M AZ O N ’ S P E R S P E C T I V E A R P U A N D A R P P U NOT ALL IMPORTANT METRICS A R E C O M P L E T E Averages are most u sefu l wh en d ata h as a n ormal d istrib u tion ( Bell c u r ve) . For examp le: • Hu man life -sp an or b lood pressure • Nu mb er of p etals on a d aisy • Clou d y d ays in S eattle
- 19. AMAZON’S PERSPECTIVERevenue User Rank Revenueby User Best-described by a power law, in which one value (such as revenue) varies as a power of another (such as rank). APP REVENUE HAS HIGH VARIANCE
- 20. A M AZ O N ’ S P E R S P E C T I V E IMPACT ON OTHER METRICS R E V E N U E D I S T R I B U T I O N I F N L U E N C E S A N A L Y S I S O ptimize th e fu n n el, b u t look for emergent b eh avior amon g p ower -u sers an d tu n e th ose p athways. • Prioritize featu res ac cord in g to monetization segment • Desig n sep arate A |B tests • Id entif y h ig h est -imp ac t flows
- 21. IT’S ALL ABOUTEMOTION 4
- 22. I T ’S A L L A B O U T E M OT I O N P E R S O N A L E X P R E S S I O N W H A T Y O U B U Y S A Y S SOMETHING ABOUT YOU Th e med ia you con su me exp resses wh o you are, an d you r emotion al con n ec tion in sp ires th e willin g n ess to p ay.
- 23. I T ’S A L L A B O U T E M OT I O N K R I T I K A : T H E W H I T E K N I G H T S GAMEVIL OFFERS AVATARS THAT APPEAL TO COLLECTORS
- 24. I T ’S A L L A B O U T E M OT I O N STAND OUR OR FIT IN? CONNECT WITH WHO OR W H A T Y O U A D M I R E Go b ig : Id entif y with someon e, a b road er commu n ity, or someth in g th at in sp ires you . Go small: E stab lish you rself as p art of an elite trib e .
- 25. I T ’S A L L A B O U T E M OT I O N S T A T U S U P D A T E TELL THE WORLD WHY Y O U ’ R E G R E A T Hig h lig ht you r ac comp lish ments or soc ial statu s. Pu rc h ases ac t as a b ad ge of ac h ievement, or a u n iform comman d in g respect.
- 26. I T ’S A L L A B O U T E M OT I O N EMOTION AND SPENDING U N D E R S T A N D T H E C O N N E C T I O N Kn owin g why th ey b u y is c ritical to makin g you r ap p attrac tive to p ower -u sers — an d more imp ortantly, worthy of th em.
- 27. BEFORE, DURING ANDAFTER 5
- 28. B E FO R E , D U R I N G A N D A F T E R B E F O R E D E S I G N F O R Y O U R P O W E R - U S E R S • Foster early en gagement • Message at th e rig ht time • Keep th em in th e ap p • Keep th em comin g b ac k • Use ser ver -sid e ac cou nts
- 29. B E FO R E , D U R I N G A N D A F T E R D U R I N G L E T YO U R C ATA L O G SUPPORT THEIR DESIRES • Self -expression / aesth etic s • A b ility • Status / collection • Mon ey for time • Pric e d istrib u tion
- 30. Source: Amazon Appstore,March 2014 31% 29% 7% 12% 11% 5% 3% 1% 14% 11% 6% 3% 16% 16% 11% 9% 0% 5% 10% 15% 20% 25% 30% 35% $0.99 $1.99 $2.99 $4.99 $9.99 $19.99 $49.99 $99.99 % of Assortment % of Sales ASSORTMENT BY PRICE POINT Total Marketplace
- 31. 28% 15% 10% 13% 11% 9% 9% 5% 32% 19% 7% 4% 10% 12% 5% 4% 0% 5% 10% 15% 20% 25% 30% 35% $0.99$1.99 $2.99 $4.99 $9.99 $19.99 $49.99 $99.99 % of Assortment % of Sales Source: Amazon Appstore, March 2014 ASSORTMENT BY PRICE POINT Top 50 Only
- 32. B E FO R E , D U R I N G A N D A F T E R A F T E R GROW WITH THE CUSTOMER • Un d erstan d p ric e sen sitivity • E xp an d you r catalog ( keep it fresh ) • Limit p ric e p oints to clarif y value • Treat all c u stomers well!
- 33. 0% 20% 40% 60% 80% 100% 120% 140% 160% 180% 1 4 710 13 16 19 22 25 28 Source: Amazon Appstore, July 2013 Days Owned +60% average selling price REGULAR CUSTOMERS SPEND MORE Price Sensitivity Declines over Time
- 34. B E FO R E , D U R I N G A N D A F T E R A F T E R GROW WITH THE CUSTOMER • Un d erstan d p ric e sen sitivity • E xp an d you r catalog ( keep it fresh ) • Limit p ric e p oints to clarif y value • Treat all c u stomers well!
- 35. 69% 100% 145% 0% 20% 40% 60% 80% 100% 120% 140% 160% 1-5 Items 6-10Items 11-15 Items Source: Amazon Appstore, March 2014 # of In-App Items for Sale ARPPU INDEX: Average = 100% SELECTION DRIVES REPEAT ORDERS More Is Better
- 36. B E FO R E , D U R I N G A N D A F T E R A F T E R GROW WITH THE CUSTOMER • Un d erstan d p ric e sen sitivity • E xp an d you r catalog ( keep it fresh ) • Limit p ric e p oints to clarif y value • Treat all c u stomers well!
- 37. Conversion Rate INDEX: Average= 100% DON’T CONFUSE YOUR CUSTOMER OFFER VARIETY, BUT NOT TOO MUCH Source: Amazon Appstore, March 2014 147% 101% 52% 0% 50% 100% 150% 200% 1-5 Price Points 6-10 Price Points 11-15 Price Points
- 38. B E FO R E , D U R I N G A N D A F T E R A F T E R GROW WITH THE CUSTOMER • Un d erstan d p ric e sen sitivity • E xp an d you r catalog ( keep it fresh ) • Limit p ric e p oints to clarif y value • Treat all c u stomers well!
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- 40. iPHONEiPAD GOOGLE PLAY AMAZON 47.7%57.1% 36.5%64.2% 66.0% 26.3% 7.7% SHARE OFMOBILE GAME SPENDERS PER APPSTORE US, UK, GER, FR 2014 LEVEL OF SPENDING AMONGST ALL MOBILE GAME SPENDERS PER APPSTORE US, UK, GER, FR 2014 56.3% 34.9% 8.7% 64.9% 28.2% 7.0% 58.1% 33.1% 8.1% % Minor Spenders % Average Spenders % Big Spenders © 2014 Newzoo | Source: Newzoo Data Explorer Source: Newzoo Trend Report Spotting The Mobile Spenders A M A Z O N R E A C H E S ( B I G ) S P E N D E R S B E S T
- 41. ANDROID PHONES &TABLETS FIRE TV & FIRE TV STICK BLACKBERRYFIRE TABLETS
- 42. M O RE WAY S TO M O N E T I Z E PREMIUM ADS SELL T-SHIRTS GET PAID FOR EVERY MINUTE OF APP USEIN APP PURCHASE
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- 44. TA K EAWAY S T H E G O O D S T U F F : P O W E R U S E R S • Power-Users drive revenue • Any user may become a power-user • They spend on what they love
- 45. TA K EAWAY S T H E W O R K P A R T : P O W E R U S E R S • Plan for them Engage early; don't distract; keep them coming back • Support their (emotional) choices Self-expression; collecting; status; advancement; optimization • Grow with them Keep catalog fresh; clarify value; offer several price points
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