when acquiring users isn't enough: retention is the answer bgf2010
DESCRIPTION
The viral goldrush is over. Customer acquisition (CPA) costs are rising. The solution: use game mechanics to drive retention and engagment.Here are practical examples and behavioural psychology examples to retain users and drive revenue.TRANSCRIPT
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When acquiring customers isn’t enough:
Harnessing gameplay to keep them coming back again and again
Nicholas Lovell, GAMESbrief
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Nicholas Lovell, GAMESbriefAuthor, How to Publish a
GameDirector, GAMESbriefClients include Atari, Channel
4, Channelflip, Firefly, nDreams and Rebellion
@nicholaslovell / @gamesbrief
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I’ll get some visitorsSome who visit will registerSome who register will
subscribeSubscribers will spend an
average of £10 per monthI’ll put my Maserati on order
1% convert = £1,000.00
1% convert = £10.00
Say each costs £0.10
Only if the average user stays for 100
months!
How most people start
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ARM yourself Hoping for the best is not good enough, you
need to ARM yourselfACQUISITION: How do I get people through
the door cost-effectively?RETENTION: How do I keep people coming
back for more?MONETISATION: How do I build money-
making strategies into gameplayMost developers focus on one of these All three are really important
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The funnelUsers
Profits
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The equations
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Why the funnel mattersThe funnel matters because it is your entire
businessTo emphasise that, we need Equation I
CPA < LTV = good businessCPA > LTV = trouble
Where:CPA is cost to acquire a userLTV is the Life Time Value of a user
You can improve your business by decreasing CPA or by increasing LTV
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The old Holy Grail: viralityA viral business can be an insanely profitable
businessCPA is close to zero, so even if LTV is low, your
business is great Time for Equation II:
Viral coefficient = A% x B x C%Where
A% = Percentage of your users who invite a friendB = Number of friends they inviteC% = Percentage of friends who accept the invitation
If viral coefficient > 1.3, time to order the Maserati
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Viral businessesTRUE FALSE
Virality != spamViral businesses add value to their users through
virality, not just to themselvesChasing virality is a fool’s errand; chase
retention instead
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The new Holy Grail: RetentionBuying customers is expensiveBuying customers is necessaryPouring customers into a leaky bucket is stupidErgo: Retention is the new Holy GrailAnd the most forgotten
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How to chase retentionRetention is in your control: it is all about
gameplayAsk yourself:
How can I make it fun and rewarding to come back every day
Remember that different gamer-types find different things rewarding
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Special Offers
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Three days in a row
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Maintenance
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Commitment I
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Commitment II
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Six social techniquesSocial proofReciprocityCommitment / consistencyAuthority LikeabilityScarcity
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ConclusionRETENTION is a gameplay issueThink about game mechanics which can
reward, delight and entertain players (while making them come back)
Make the transition from ONE MORE GO to COME BACK TOMORROW