In this talk from Pocket Gamer San Francisco, Ted Verani, Scientific Revenue's Head of Business Development walks a crowd of monetization designers and game engineers through the basics of annuity design. By the end, they know exactly how to add annuities to their games and increase their monetization. www.scientificrevenue.com

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How
to
Design
Annuities
Ted Verani, VP of Business Development
Pocket Gamer Connects, San Francisco

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Scientific
Revenue
is
a
machine-­‐‑
learning
based
dynamic
pricing
platform
for
in-­‐‑app
purchases

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The
magic
of
selling
the
same
thing
at
different
price
points
How
much
is
the
large
human
bridle
worth?
The
difference
goes
straight
to
the
bottom
line.

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Background

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Typical
Game
• Your
conversion
is
between
.5%
and
3%
• ¼
to
½
of
your
purchasers
buy
something
in
the
first
two
days
• Somewhere
between
!
"⁄ and
$
"⁄ of
your
players
don’t
visit
the
coin
store
at
all.
• You
have
a
lot
of
people
who
will
never
purchase,
but
who
will
play
the
game
for
a
extended
period
of
time
• Some
of
them
have
money!

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Classifying
Players
Long
Term
Players
Purchasers
First
Day
Purchasers
Impulse
Purchasers
(“unplanned
purchases”)

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How
do
we
reach
players
that
don’t
buy
on
impulse?

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Inspiration

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More
Inspiration:
Daily
Login
Rewards

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What
is
an
Annuity?

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http://www.gamasutra.com/blogs/WilliamGrosso/20170612/297723/How_to_Des
ign_an_Annuity.php

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Example:
“Gold
Pass”
in
Nitro
Nation

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How
to
design
an
Annuity

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KEY
GOAL:
Little
or
No
Cannibalization
• Annuities
should
NOT
replace
regular
IAP
spend
• Done
properly,
they
cause
grinders
to
become
spenders
• Done
properly,
they
often
increase
demand
for
goods
and
currency
(teaser
/
taste
model)
• Add
people
to
the
conversion
pool
and
to
the
long-­‐‑term
retention
pool

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The
Simplest
Annuity
That
Actually
Works
• First,
implement
a
daily
reward
system
based
on
currency
• Make
sure
it
works,
and
brings
people
back
• Make
sure
it
doesn’t
cannibalize
revenue
• On
a
selective
basis,
offer
to
double
the
daily
login
reward for
fixed
price
to
people
who
have
high
engagement
and
are
unlikely
to
buy
anything

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How
to
Design
(more
complex)
Annuities

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Things
You
Must
Know
About
Your
Game
• Lifetime
Spending
Caps
• Is
it
possible
to
“Buy
the
game”
• Difficulty
of
Obtaining
Currency
• If
easy
to
get
by
playing
then
hard
to
charge
• Minimum
Values
• Daily
Login
Bonuses
• Easily
earned
currency
amounts
(typical
daily
earn)
• Maximum
Values
• Average
daily
spend
• Typical
“medium
end”
purchase
• Annuities
shouldn’t
cover
your
spend

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Design
Considerations
for
Annuity
1. Duration
Needs
to
be
long
enough
to
delay
most
of
the
reward
2. Confirmation
Need
to
click
something
to
get
the
reward
3. Deliverables
Virtual
currency
is
a
safe
and
easy
option
4. Delivery
Schedules
Deliver
the
same
amount
of
currency
every
day

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Design
Considerations
for
Annuity
(cont)
5. Discount
Level
Should
be
substantial
discount
from
what
would
pay
in
store
6. Availability
Make
it
available
intermittently
on
randomized
schedule
7. Stackability
Do
not
let
people
purchase
or
receive
multiple
annuities
simultaneously

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Pulling
it
together
…..
Things
you
already
know….
(min
and
max
value)
• For
general
players,
annuity
should
be
193
coins
• Make
it
200
because
the
difference
is
small
and
200
is
psychologically
more
friendly
What
is
the
cost?
• You
know
it
is
200
coins
x
28
days(Duration),
which
is
5600
coins
in
total
• Take
the
Black
Friday
Exchange
Rate,
which
is
$.004
for
single
coin
• Then,
the
annuity
cost
is
5600
x
$.004
=
$22.40
• Which
is
$19.99
once
you
make
it
psychologically
friendly

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The
Monetisation Design
Library
• On
How
to
Design
an
Annuity
http://www.gamasutra.com/blogs/WilliamGrosso/20170612/297723/How_to_Design_an_Annuity.php
• On
Future
of
IAP
Monetization
http://www.gamasutra.com/blogs/WilliamGrosso/20170510/297722/The_Future_of_IAP_Monetization_i
n_Mobile_Games.php
• On
Pay
to
Win
Strategies.
http://www.gamasutra.com/blogs/WilliamGrosso/20161102/284598/Looking_at_Pay_to_Win.php
• On
Daily
Login
Bonuses.
http://www.gamasutra.com/blogs/WilliamGrosso/20160613/274759/The_Science__Craft_of_Designing_D
aily_Rewards__and_Why_FTP_Games_Need_Them.php
• On
Annuities.
http://www.gamasutra.com/blogs/IsaacKnowles/20160512/272484/Want_to_Increase_Your_FreetoPlay_
Game_Revenue__Retention_Experiment_With_Virtual_Currency_Annuities.php
• Our
IAP
Survey.
http://www.pocketgamer.biz/data-­‐‑and-­‐‑research/63436/scientific-­‐‑revenue-­‐‑survey/
and
http://www.scientificrevenue.com/iap-­‐‑survey/
• On
Feeder
Apps.
http://www.scientificrevenue.com/blog-­‐‑posts/how-­‐‑to-­‐‑turn-­‐‑free-­‐‑viral-­‐‑apps-­‐‑into-­‐‑feeder-­‐‑apps-­‐‑that-­‐‑actually-­‐‑
make-­‐‑money/
• On
Powerup Design.
http://www.scientificrevenue.com/blog-­‐‑posts/rescues-­‐‑buffs-­‐‑skips-­‐‑how-­‐‑to-­‐‑design-­‐‑mobile-­‐‑game-­‐‑power-­‐‑
ups-­‐‑for-­‐‑optimal-­‐‑iap/
• On
Payment
Wall
Design.
http://www.scientificrevenue.com/blog-­‐‑posts/how-­‐‑to-­‐‑design-­‐‑an-­‐‑in-­‐‑app-­‐‑purchase-­‐‑paywall-­‐‑that-­‐‑earns-­‐‑
you-­‐‑money-­‐‑without-­‐‑annoying-­‐‑your-­‐‑players/

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Continuing
the
Conversation
Twitter:
SciRev Resources
Page
http://www.scientificrevenue.com/resources
SciRev Blog:
http://www.scientificrevenue.com/blog/
Excellent
Mailing
Lists:
https://mailman.stanford.edu/mailman/listinfo/gsb-­‐‑videogames
https://gaminginsiders.mobilize.io/users/sign_in
https://twitter.com/SciRevenue

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Thank
You
Ted Verani, VP of Business Development
ted@scientificrevenue.com