stop ignoring 98 percent of your audience! best practices for monetizing non-paying users, damon...
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STOP IGNORING 98%
OF YOUR AUDIENCE!
Damon Marshall VP of Business Development
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Remember when…..
….we used to talk about ARPU?
But then a sea of animals started getting in the way of our total audience.
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So, we added a “P” to get ARPPU
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Monetization Strategy
Direct Payments
Ads
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Here Are Some Facts
Web
“Only 1% - 5% of a social game’s audience purchase
virtual items.” - Casual Games Association; Social Network Games Report; 2012
Mobile
“The number of people that spend money on in-game items in free-to-play games ranges from 0.5% to 6%, depending on a game's quality and mechanics.”
- Flurry July 7, 2011
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Here Are Some Facts
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King.com’s advertising revenue from social games has increased tenfold over 2012 and currently accounts for 15% of total annual revenue.
- Inside Social Games, Nov. 12, 2012
Angry Birds reported between $1M-$6M per month of ad based revenue .
- Casual Games Sector Report: Mobile Games; 2012
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Here Are Some Facts
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Casual Games Association; Social Network Games Report; 2012
Inside Network; Inside Social Gold; 2010
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Popular Myths
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Advertising is going to f*ck up my game!
Ads take users out of the “experience”
I don’t want to cannibalize my paying users
The revenue is not meaningful enough
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Display Ads
Interstitials
“Achievement” Ads
Offerwall
Rewards-based Video
Advertising is going to f*ck up my game!
Chose the right ad product
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Advertising is going to f*ck up my game!
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Avoid these pitfalls:
Interruption
Distraction, Annoyance
Wrong ad, not relevant
Clicking on ads by mistake while playing
Gamer feels exploited
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Advertising is going to f*ck up my game!
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Interruption- No, it is opt-in
Distraction/Annoyance – subtle ad unit, not intrusive to gameplay
Wrong ad, not relevant: Mighty Pirates => The Pirates movie
Clicking on ads by mistake: Good Design
Gamer not feeling exploited
Rewarded for their actions
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Ads take gamers out of the experience
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Ads act as “enablers” in the game
Users engage on their terms!
Ads can be a utility, a service in the game; similar to other utilities you create
Ads are “friends” of non-paying users
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Be thoughtful….
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Be thoughtful….
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I Don’t Want To Cannibalize Paying Users
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Treat different users differently!
Example Datapoint: 95% of users who do not buy anything after playing for 30 days, never buy anything throughout their lifetime.
Time to treat them to a delicious ad!
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Increased engagement
Increased retention
Reduces churn
Increased traffic (word of mouth, friends start playing)
Increased ARPU (one “P”)
Increased conversion from non-paying to paying users
Remember, free players are essential to your game’s success, so keep them happy!
Integrating ads results in:
I Don’t Want To Cannibalize Paying Users
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The revenue is not meaningful enough
80% Re-booking rate
Increased spend after first buy
Audience engagement rates 3x as high as TV (IAB 2011)
Positive Brand Association
Post video view click rates are typically 15 - 30%
CPV is preferable to CPM
Advertisers love the social gaming audience!
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A well thought out ad strategy is yeilding $10,000+ a day for publishers
Branded video is yielding $.04 to $.06 CPV (Cost per view) which is equivalent to $40 to $60 CPM
Click through rates on this engagement are as high as 20%
Completion rates are 80%
Be strategic in selecting your ad network partners to achieve 100% fill rate.
The revenue is not meaningful enough
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Facebook Examples
Toyota American Pie Pepsi
Ice Age Adidas Disney
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Mobile Examples
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Gamer is presented
with ‘Free’ icon
User initiated Content
BrandConnect player
opens, presents
brand and video
User must watch
100% of the video
Once the video is
complete, CTA
message appears
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Concluding Slide
Games have become a new mass medium that is scalable and targeted for advertisers
Don’t “P” on your audience
Direct payments and ad monetization can live in harmony (not an “either/or”)
Be thoughtful about how you roll out your ad products – one size does NOT fit all
It’s happening!!! Brands and agencies are on board, and more are coming!
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Thank you!