Will Freeman has written a good article for PocketGamer that examines the increase in mobile game user acquisition costs over the festive period.
I find this upward trend and one-dimensional thinking to be very sad and worrying for what it means for the larger mobile games ecosystem. The ‘cost’ is not simply fiscal (e.g. in terms of CPI) but much wider in terms of the impact it is having on the wider mobile games ecosystem. I believe that it is damaging to games makers and failing games players alike.
I recently attended the App Marketing Summit in Berlin and many speakers there were proudly talking about how enlightened developers should focus on profitable installs (where LTV>CPI) instead of simply aiming for high chart position or ‘simply’ building huge DAU/MAU levels. Whilst this is true, it is also obvious (sell stuff for more than it costs to make and market….duh!) and doesn’t address the fact that we are fast reaching (or have reached?) the point where only well-funded studios with a portfolio of products, strong IP and which already have an existing audience, have a chance of being commercially sustainable. Is this not the exact same scenario that drove developers away from the traditional triple-A console/PC games market?
My point, however, is not that the temporary utopia where anyone can make a mobile game has been eroded, because it is still perfectly viable for anyone to make a game on mobile. Rather, what vexes me is that if you make a GOOD game that is polished, technically robust, novel, great fun and demonstrably ‘worthy’ of an audience (e.g. the metrics show people engage with it), without the aforementioned commercial capacity and advantages you will have zero (OK, maybe 0.1%) chance of a major breakthrough. There is very little chance, even, of achieving financial breakeven. Ergo, mobile game development is not commercially viable for most game developers.
When the entire industry focuses on using paid-for user acquisition (in-game adverts and cross-promotion) then it is only focussing on ‘pushing’ to that vast ocean of mobile device users, and pushing is proving to necessitate an ever-increasing amount of marketing spondoolies. Focussing only on ‘beating’ the CPI is, ultimately, a battle we are destined to lose as CPI is only ever going to increase. Paying for users is an addiction that this industry has and, currently, accepts but one that needs to overcome for our collective health.
Paid-user acquisition is also highly geared towards supporting large-scale F2P games that successfully milk a minority of users or premium games based around very strong IP that people will pay for before properly trying the product. I have no axe to grind with either – I’m a big fan of F2P, when done well, and who doesn’t find a Minion funny? – but it makes the range of games available very limited in nature. It leads to an endless number of ever-so-slightly improved clones of a small range of game genres and themes (fancy another match3 or endless runner game anyone?).
That means that the vast potential for smaller-scale but creatively and technically innovative games, or simply games aimed at smaller niche audiences, is completely neglected. This isn’t a plea for artificially propping up wannabe indie dreamers; this is about wanting to engender a genuine ecosystem where consumers (our users, our customers, the nice people what pay our bills) get the games they want and those that make them can afford to do so. Should it not be possible to make and games for, say, £100k and to achieve net sales (after Apple, hosting etc) of £200k? Would that not be a good commercial outcome? Is that not profitable? Could that be sustainable?
The paid-user acquisition model is ever so wasteful; it is like paying a bunch of rich foreign fishing boat owners to hang a 10-mile long fishing net off the back of dozens of boats to catch one million sardines when you only want (and can only sell!) the couple of hundred tuna that also get caught. Everything else gets thrown back into the sea. The rich boat owners are the plethora of advertising and cross-promotion networks and the dead sardines get resold again and again to the next unsuspecting and naive customer (aka games developer). Now you can argue (as indeed I have done) that this ‘waste’ is irrelevant so long as the net (pardon the pun) result is that there is more cash in your bank account that when you started. How sustainable is that though? No matter how clever you are with data analysis, ultimately games making in involves creative and commercial risk. I keep hearing that F2P is now well-understood, yet we all see plenty of F2P games continue to fail commercially even though they, presumably, survived the ‘culling of the ugly children’ stage of development when the metrics are not strong enough. The costs of production and the cost of marketing are rising sharply. Would not a more intelligent approach be to try and find ways to acquire users at a lower cost? This industry has always been at the forefront of technology development. It is strange that it isn’t using that expertise to improve the ways in which we match games with gamers.
Paid UA will always exist and will rightly always be part of the marketing mix but right now it is pretty much the only strategy and vast sums of money that are being spent in/on games is leaching away from those that make the games to those that operate the advertising networks. Does it really make sense that those who spend months or even years toiling away, taking creative, technical and commercial risks are simply the means by which another industry (advertising) gets wealthy?
Don’t hold out for the app stores of traditional games media to be the panacea that fixes this problem. The app stores are the means of distribution for all mobile games but the means of discovery for only a tiny proportion of games. This will not change to any significant degree. The vast, broad mobile games audience does not engage with traditional games media. The dozens of ‘discovery apps’ that are out there currently are (largely) characterised by paid-for promotions and, quite often, dirty underhand tactics to promote shoddy games or to grab advertising revenues from unsuspecting users.
I am convinced that we need to be thinking about how we can ‘pull’ users into games by understanding the interests, behaviours, actions and characteristics of individual users and applying all kinds of (well understood and proven) predictive modelling and targeted recommendation techniques to show them the games that they will more likely enjoy and more likely play for extended periods.
That is what we are working towards; “Making it easy to find good mobile games you will enjoy”. If you are open-minded (or just plain utterly desperate) about the state of mobile games user acquisition, then please drop us a line. We’re largely in stealth mode still but keen to talk to anyone in the industry about how things can improve….hell, even fat fishing boat owners.
The CoronaLabs Blog featured a guest piece written by Paul Simons, developer of Plasma Pig (iOS and Android). The article is a honest and worrying illustration of how difficult it is for small/indie mobile games developers to get user traction for their games. Game discovery is an issue I am particularly passionate about and Evil27 Games is currently exploring ideas about how to tackle this exact problem (see www.everyonesplaying.com).
In the meantime, I wanted to post my thoughts on the subject to this blog. We are seeking to engage with social/mobile games developers and publishers to share and discuss our ideas. If you are interested in having a chat please drop us a line.
In response to “Guest piece: For the love of game development”, I posted the following response on the CoronaLabs blog
I think your experience is extremely common and not just for one-person developers; it is just as hard for small studios that spend $100k, $250k or more on a game.
I was Studio Manager at a mobile games developer in the UK last year and joined just as they released the first version of a side-scrolling RPG. Whilst I couldn’t claim that the game – at v1.0 – was earth-shatteringly good, it was nonetheless a pretty compelling game (cost us approx $250k) and was free (FreetoPlay at least). We spent in the order of $25k on incentivised installs in order to get AppStore chart visibility in the hope of getting that ‘organic uplift’ that we’re all conditioned to aim for. The reality was that the game hung around the top 50-75 for about a week then fell from view. I recall that we got 50k or so downloads from that but the install rate fell off dramatically once we were no longer in the charts.
My point is that the whole app/game ecosystem is now geared in favour of those with deep pockets and the companies that control access to the player audiences (offers, incentivised installs, in-game promotions, paid-for cross-promotion, paid reviews etc etc). We have ‘free’ distribution as small/indie devs but we do not have free access to players; far from it.
I see ‘services’ that claim to be able to deliver a top 10 chart position for $100k and I regularly hear of developers/publishers who are spending $100k on week one burst advertising. The larger publishers are reportedly spending between $1m-$5m on marketing some titles. This isn’t a level playing field and is rapidly pricing all but the big boys out of user acquisition (read; “commercial viability”). IMHO this is failing not just the smaller dev community but consumers. That’s a broken market in my view. The correlation between product visibility and product quality is, generally speaking, highly distorted and that is not good for the wider industry as a whole.
Its unrealistic to think that marketing isn’t important in a maturing competitive industry, but when success is so highly-dependent upon AppStore visibility (or, for example, Facebook App Centre visibility) and, in 99% of cases, this is only achieved through huge advertising/incentivised installs, then the outlook doesn’t look too rosy for small devs (and, by extension, tools makers like Corona ).
Apple have just started incorporating user reviews into their ranking algorithm but all that means is that companies (cough..Zynga) go and pay 250 people for a 5* rating and bingo they rank in the top 20.
Personally I think there needs to be a better way to connect GOOD games with players that might want them. I’m working on an early-stage concept for a discovery platform that can surface visibility to games that are engaging their audiences irrespective of the volume and velocity of installs or the current revenue levels.
I’d dearly love input from smaller/indie mobile games developers along the way. I’ve set up a launch site for devs and players alike to register their interest and am currently (separately) in the process of raising some seed funding to get an MVP of the platform together.
If the potential platform/service is of potential interest to you please do visit http://www.everyonesplaying.com and tell us your email address so we can let you know how things progress.
It’s no longer good enough to “just have a good game”….but it should be!
There has been a lot of coverage of how Apple has decided to treat app discovery service App Gratis – see here for an example (PocketGamer.biz).
It seems to me that there is an easy way for both Apple and the ‘discovery app’ services to coexist; change the chart ranking system to be based on an engagement-based measure rather than simplistic downloads.
As AppGratis, TapJoy and many others have shown; you can fake popularity through incentivised downloads/increased visibility but only for the short term (unless you have truly mammoth marketing budgets – but nobody will continue to prop up a game that isn’t actually performing in the longer term). You can’t fake popularity if it is measured in terms of true engagement unless you but a million iPhones and have an army of pretend users who will play crap games all day for free.
Apple (or any other store) should provide a dead easy API that any game or app updated every time it was used (offline plays could be batched up and posted when the device hits wifi or the cellular network). Hell, they could team up with the likes of Flurry and have it done in a week.
 Apple gets charts that reflect how (truly) popular all games are based on how frequently people play them and for what duration.
 The app discovery services still provide the ‘discovery’ aspect….and it is then down to the quality of the game itself and the developer’s quality of service/optimisation/new content that dictates how long that game stays in the charts.
 As a player I will trust the charts more as they now reflect sustained popularity (engagement) over short term marketing-driven bursts of visibility. Equally, the ‘newcomers’ chart will be geared towards those games that are boosted either by paid or by naturally viral means.
 As a indie developer I don’t feel that the chart is artificial and unobtainable if I work at building awareness through the games press and social media for my games
 As a developer/publisher with ad spend budget I can buy my initial visibility e.g. take a gamble that my app will perform (sufficiently to recoup my additional investment in marketing)
Every one is happy!