Presentation from the Brazil Independent Games (BIG) Festival 2014 on Maximizing Player Retention and Monetization in Free-to-Play Games with a Comparative Analysis of Asian & Western F2P Games

1. Maximizing Player Retention and
Monetization in Free-to-Play Games:
Data, Best Practices and Case Studies
David P Chiu
Senior Director of Developer Relations &
Business Development
Kongregate, A GameStop Company

2. What is Kongregate?
• Open platform for browser-based games
– Flash, Unity, HTML5, Java, etc.
– 96%+ of users already have Unity installed
• 21M+ monthly unique visitors worldwide
• Core gamers – 85% male, average age of 22
• MMOs, RPGs, CCGs/TCGs, TD, shooters, etc.
• Platform level virtual currency “Kreds” for F2P games
• Acquired by GameStop July 2010

3. Kongregate is also a mobile publisher of F2P games

4. Some of Kongregate’s Existing Developer Partners

5. Stats both reflect & shape mind-set
So what statistics does F2P focus on?
Daily Active Users, DAU
$/DAU
1- & 7-Day Retention
To a lesser extent MAU & 30-Day
30-Day Retention is a good stat, but 30 days is
not “long-term” retention, it’s the start.

6. A little background
• All stats are lifetime, min 6 weeks on platform
• ARPU: average revenue per user
• ARPPU: average revenue per paying user
• Player: a Kongregate registered user who loaded
the game page at least once
• Plays = Sessions: our preferred method to measure
retention

7. $0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
$8.00
$9.00
$10.00
$0 $50 $100 $150 $200 $250 $300 $350 $400 $450 $500
ARPU(USD$)
ARPPU (USD$)
ARPU & ARPPU

9. Linear Growth x Many Years =
Awesome Business

10. Commitment Matters
Type of Player % Buyers Avg Trx ARPPU ARPU % Players % of Rev
Non-Repeats 0.03% 2.1 $24.69 $0.01 43% 0%
Repeats (2-9 plays) 0.40% 1.85 $19.61 $0.08 40% 3%
Regs (10-49 plays) 4.68% 2.61 $21.35 $1.00 10% 12%
Committed (50+ plays) 16.53% 7.03 $96.92 $16.02 7% 84%

11. Commitment Really Matters

12. 2D vs 3D

17. 2D vs 3D
• 3D games tend to have lower monetization
compared to 2D games
– Lower ARPU, ARPPU & % Buyers
– Initial retention has similar range vs 2D games
– But long term retention is much lower
• Does this mean a 3D F2P game can’t succeed?
– No, remember correlation does not equal causation!

18. 2D vs 3D
• Confounding factors that may help explain difference
in monetization and retention #s
• Developers of 3D games tend to:
– Be console developers with limited F2P experience
– Focus on gfx, may shifts resources away from improving
retention and monetization funnels
– Not accept pay-for-convenience & pay-to-win
– Make games in genres with low monetization (FPS, MOBA)
– May still design games as a shippable product instead of
designing for long term retention, games-as-a-service

19. Asian F2P vs Western F2P

20. ARPU and ARPPU

21. ARPU & ARPPU
• ARPPUs for single-player games cluster around $5-$10
• Multiplayer games range $20-$350
• Average ARPPU for a multiplayer game from Asia: $181
• Average for Western multiplayer game: $51
• Only 9 Western games have an ARPPU above $100
• ARPPU is the main factor in high ARPU for Asian
games, important factor for all games

22. ARPU and % Buyers

23. ARPU and % Repeats

24. ARPU and % 50+ gameplays

25. Asian vs Western Style
• Asian games: High ARPPU, tight player funnel
– Monetization caters well to big spenders
• Western games: Lower ARPPU, wide player
funnel
– Monetization focuses more on initial retention and
broad conversion to paid at lower prices
– Pay 2 Win is not as accepted by Western devs
• Mixed games: can combine the best of both
– High conversion, wide funnel, still create big spenders

27. F2P Best Practices

28. Best Practices for Optimizing Retention:
Keeping players engaged

29. Daily Play Bonuses
• Daily play bonuses are good to get users coming back regular
• But improve on the typical 5-7 day daily bonuses
• Reward playing game regularly
in longer term
• Doesn’t reset after 5-7 days
• Doesn’t “punish” players for
missing a day

30. Daily Play Bonuses
• Add an element of chance
- make it exciting!
• Repeat logins opens up
bigger potential rewards

31. Don’t punish people for taking a break
• Psychologically, punishments or the possibility of punishment deters
unwanted behavior
• Base/castle raided, loot stolen, crops withered, troops dead, account
de-activated, etc. deter players from being away too long
• But it can be a two-edged sword
• Players sometimes need to take a break (exams, vacation, illness)
• Punishment may drive re-activated users away again
“I just got back from vacation/work
conference/being sick but my base is
completely destroyed, my resources are gone,
troops are dead. No point in getting back in the
game since I lost everything already.”

32. Don’t punish people for taking a break
• It can sting but it shouldn’t handicap
you permanently
• Limit amount of resources that can
be looted or # times you can be
attacked while gone
• Enable shield or protection time if
you lose a significant amount
• Mix positive reinforcement with
punishment
• Quick one-button rebuild
• Resources still available for harvest
• Gain XP or gold while away

33. Keep players busy!
More things to do = more players staying
• Solo and team PvE
• Solo and team PvP
• Asynch raids
• Guild battles
• World boss raids
• Farming
• Town Building
• Weapon/Gear
Synthesizing & Upgrading
• Astral Collecting and
Combining
• Etc.
It is important to pace the introduction of new features/gameplay modes to not
overwhelm players with a long and intimidating tutorial.

34. Without progress you have nothing
• The foundations of a F2P game are a strong RPG elements and a
sense of progress over time
• Building up account, leveling up, adding/improves skills and stats, etc
• Surprisingly it’s more important than multiplayer
Type % 50+ Plays % Buyers ARPPU ARPU
Multiplayer RPG 2.6% 0.75% $69 $0.51
Multiplayer Non-RPG 1.0% 0.45% $9 $0.05
Single-player RPG 1.8% 1.29% $12 $0.10
Single-Player Non-RPG 0.2% 0.53% $4 $0.02
Deep RPG mechanics and multiplayer matter:
• 25x ARPU for Multiplayer RPG vs Single Player non-RPG!

35. Asynchronous > Synchronous
Type % 50 Plays % Buyers ARPPU ARPU
Synchronous 1.4% 0.54% $43 $0.25
Asynchronous 3.6% 0.80% $88 $0.66
Both 2.9% 1.07% $51 $0.55
Single-Player 0.8% 0.85% $7 $0.05
• Multiplayer keeps players engaged and busy in the long run
• But not all types of multiplayer are created equal
• Top games have both synchronous and asynchronous multiplayer
(more is better)
• Asynchronous is better than synchronous because it allows players to
play at their own pace and convenience

36. Best Practices for Optimizing Monetization:
A happy customer is a paying customer

37. Shopping should be easy and frictionless
• Location, location, location – make the store easy to find!
• Make it easy to find the right item
– Meaningful categories and item descriptions
– No massive scroll bars
• Mix soft currency and hard currency items
• BUT – don’t try to sell too hard, too fast. First few sessions should
focus on fun & giving players reasons to come back to play and get
hooked.

38. Buy Screen
• Bonuses % or/and items provide incentives for buying larger hard currency packages
• Clearly call out bonuses of larger packages!
• Make all packages visible in one page
• Hide $100+ packages until after first purchase

39. Making the shopping experience interesting
• First time buyer/ Starter packages
• Seed players with some paid/hard currency and guide “intro purchase”
• Deals/events to get people into the habit of spending regularly
• Offer items that enhance the gameplay experience (not just speedups)
• Intro the right items at the right time
– Lvl 1 players should not be shown the lvl 100+ holy sword that’s on sale for $100)
• Keep them coming back – keep store fresh by adding new items, unlocking items as
players level up and featuring seasonal and time-limited items

40. Make sure players can spend
as much as they want
• The longer someone plays your game the more likely they are to buy and
the less price sensitive they become
• Give committed players the ability to spend at $1,000+ if they want
• Have lots of items that are appealing and useful to a committed player
and price them higher (if possible) than items meant for early/mid-game
play. [Higher means $30-100, not $1000]
• If you make a fun game, someone may want to spend an infinite amount.
• Don’t create a situation where spending is capped by availability or utility.
• Again, remember to make it easy for players to buy!

41. Best Practices for Community Building:
When you’re here, you’re family!

42. Make it easy for community to build
Chat, forums, player-to-player
messages are all great
Real relationships build when
people interact. The more ways
they can do it, the better.

43. Guilds are awesome
• 100% of our top games have guilds
• Guild members spend 10-20x more than non-guild members
• Strong correlation as guilds improve retention and monetization
with late stage players
Some reasons they make a difference
• Social incentives to return  I want to see my friends
• Social pressures to return  I don’t want to disappoint them
• Improves the psychology of purchases  I’m doing it for the
team, not me
• Upends the dynamics of pay-to-win  can set up a symbiotic
relationship between buyers and non-buyers where both add
value to the same group

44. Community Management and
Customer Service
If a player invests many hours into
a game they begin to feel some
ownership. It may be YOUR game,
but it’s THEIR experience
1. Be visible – forums, chat, email
2. Listen to their concerns and acknowledge their emotions
3. Be transparent, honest, and accurate
4. Give advance notice of changes and downtimes
5. Don’t feed the trolls

45. Opportunity Complains
Customer service is a chance to surprise and delight
• Handle things quickly
• Be generous with compensation
• But don’t do something unless you’re willing to do it
for everybody

46. Surprise and delight
• IGG rewards its players with some resources after each of its
weekly 30-minute maintenance

47. Have fun with your community

48. The Value of Developer Activity
Keep feeding your players
• Regular updates, new features, and events yield greater
engagement and reduced fatigue.
• Sales and specials can offer significant jumps in revenue.

49. The Value of Developer Activity
Hot New Games
Badges added
Custom User Items
New zone, XL, etc.
Equips, Guild bonuses
Halloween, sale
Christmas event
Guild wars
FantasyOnlineRevenue

50. The Value of Developer Activity
Front Page
Badges
Item promotion
New Version
Revenue
Fantasy Online
Asian MMO

51. The Value of Developer Activity
Front page
Badges added
Expansion
Labor day event
Expansion
Christmas update
Expansion
Easter event
Expansion
Expansion
New Server
Revenue
Fantasy Online
Dream World
Asian MMO

52. THANK YOU
For a copy of the presentation or questions, email
davidchiu@gamestop.com
For more talks & data visit developers.kongregate.com
For web games contact us at apps@kongregate.com
If you’re interested in mobile publishing it’s mobile@kongregate.com
Follow us on Twitter: @EmilyG & @KongregateDevs