How to increase game revenue by segmenting users
On the example of the game “Caramels” Anna Vyugina, ex-product manager of Fotostrana, spoke about the solutions that helped increase the revenue of the project.
The report was read at White Nights St.Petersburg 2018. Anna has prepared a printed version of it for us.
Anna Vyugina
“Karamelki” is one of the most successful of Fotostrana’s own games. This is also due to the fact that we are constantly experimenting with the project. For example, in order to maximize the revenue of the game, we also worked with segmentation of its audience.
Not all people have the same solvency: someone can pay more, someone less. In the real world, manufacturers of goods to solve this problem produce several product lines, each of which is focused on a certain level of the buyer.
Everything is more complicated in games. We have one product with different users. Therefore, it is necessary to balance between those who pay well and those who pay little so that both categories enjoy the game and also pay. It is necessary to take into account these features in every action and mechanics.
The “Photostrane” has its own names of a particular payment segment of the user. However, to make the material easier to perceive, I will use well-established terms: superkit, whale, dolphin, minnow.
Why do we need segmentation?
It performs two tasks.
Firstly, if there is an idea of which segment a particular user belongs to, we can make him a more accurate offer, to which he is more likely to respond.
Secondly, it is necessary to understand the structure of the audience and understand the ratio of one segment to another.
There is nothing unusual in the structure of the audience of “Caramel”. The vast majority of users in the game do not pay. Supercits are only 2%.
There are strategies in which the emphasis is only on paying well. As for the low—paying ones, they forget about them, they say, “you can’t pay more – fall off.”
For us, this approach was unacceptable for several reasons.
First. In general, the audience of “Caramels” is small. It is important to retain each user.
Second. Only minnows, those low-paying players, are responsible for 17% of income in our game.
So our strategy was to maximize revenue from each segment.
We sell boosters one by one and “wholesale”
Working with a non-paying audience
Initially, we sold boosters three at a time. This is a classic three-in-a-row offer for games.
But there was a hypothesis that the amount billed for boosters could be unacceptable for low-paying and non-paying users. We decided to try to give them the opportunity to buy boosters one at a time.
We did not make a separate position in the in-game store. Instead, we started offering to buy a booster during the game. At the moment when we realized that a person was likely to lose, we issued an offer to buy a booster.
After that, the number of breakthrough payments (first user payments) increased by 17%. So we came to the conclusion that a booster offered at the right time to a person who has never paid in the game can motivate him to buy.
As for the minnows, we received less money in total, although the number of people who made a purchase, as well as the purchases themselves, has become much larger.
Suppose we didn’t do this separation. So it would seem to us that the result of the action is unsatisfactory. But thanks to segmentation, we saw that for non-paying users, the promotion went into a plus.
Big offers
The next case also concerns the number of boosters in the offer. We gave the opportunity to buy 6 and 9 booster packs at a discount of 7% and 12%, respectively.
The hypothesis was that people who can buy a lot will be more willing to buy 9 boosters each, which will raise our average check of superkits and whales.
This innovation was not expected to affect the low payment segments, but those who pay well did not pay much more. They preferred not to buy for the future, but to buy as needed. We received a slight increase, which can be attributed to the error. We didn’t want to make a higher discount, but such a small one turned out to be unattractive.
At the same time, buying coins (game currency) on the same principle works better. For example, in another game on Photostrane, the introduction of discounts on large packages increased their sales by about 20%. This suggests that all promotions and mechanics depend on the specifics of the game, on the audience, on the context.
From changing places…
The next thing I’m going to talk about is probably a classic. Many have already talked about the miraculous change in the order of goods withdrawal in the store. The point is to make it so that when a player enters the store, the first things he sees are the goods that we want to sell to him. As a rule, these are goods whose cost corresponds to his average check or slightly higher.
By implementing this mechanics, we wanted to wash the crystals and reduce the purchase of boosters for these crystals.
Crystals are a soft currency that is issued in events. It is clear that those who pay well get more crystals. Obviously, it is not profitable for us for them to buy boosters with it. That’s why we focused our players’ attention on the decor. For superkits and whales, we put the most expensive positions in the first place, for the rest — cheaper ones.
As a result, purchases of boosters for crystals decreased, and purchases of decor for crystals increased. At the same time, the total number of booster purchases has not changed. Conditionally, as 100 boosters were bought per day, so they are bought. But if earlier players bought 50 boosters for crystals and 50 for real, then after changing the location of positions in the store, they began to buy 70 pieces for real and 30 for crystals. It is clear that this has led to an increase in income.
Increase in the price of the goods
When you want to increase revenue from the game, the first thing that comes to mind is to raise the cost of goods.
At some point we decided to raise the cost of additional moves. Additional moves are one of the main income items. It seemed to us that if we increased the cost, for example, by 15%, then the income would also grow.
We have raised the cost of additional moves. After that, superkits and whales did not pay less, and they themselves did not become less. So for this segment, we received a plus in revenue.
However, all other segments began to “fall off”. As a result, we earned about the same money, but the number of our paying audience has significantly decreased, as well as the number of purchases. We had to return the previous cost of moves.
What conclusion can be drawn? You can raise prices for premium goods, for goods that are bought by superkits. Maybe they won’t even notice it. But if you raise the price of a marketable product for everyone, then get ready for mass discontent.
A small life hack. If you do not know what price to put and are afraid to lose, then it is better to overstate it initially. You will always have time to reduce it.
Packs
Packs are special offers, sets of goods with a big discount. The composition of the pack varies depending on the payment group to which the user belongs.
When working with packs, there are pitfalls. For example, when creating packages for people with a high average check, there is a risk of providing it with a large number of consumables at a low price. This may reduce his purchases in the near future.
In this case, there are a couple of tricks.
The first is to put as little valuable goods in the pack as possible and as much as possible of those items that sell poorly, are not marketable.
The second is to put a product in the package, the cost of which is unknown. In our case, such goods were decor and our superbuster.
I want to tell you about the superbuster separately. In short, this is the button “skip a difficult level and move on to the next one”. When we introduced this functionality, we had doubts. It seemed to us that people were playing for the sake of the game, why would they skip the level. But, as practice has shown, people are happy to skip levels that they have already spent a lot of time on.
It is impossible to buy a superbuster. We position it as something very valuable, therefore, by placing a couple of such boosters in the pack, we make the real cost of the pack not obvious.
With the decor, the situation is about the same. Plus, the decor is appreciated only by very paying users, since it does not bring any practical benefits. Such users like unique, albeit useless things that they can brag about in front of others.
Returning to the packs. The real value of this position, if we put such things in it, becomes not obvious. But a big discount does its job. Packs were popular, both with superkits and whales, and with other segments of users.
Special offers
Gift promotions work well. When we motivate to buy something for its usual cost, but we add to it another gift.
This mechanic shows itself positively for all paying groups. However, each audience should have different products.
Look, if a customer came to the store to buy a scooter, it is not necessary to offer him a chic sports car, to which the tinting will go as a gift.
If a person leaves $1 in the game, there is no point in offering him a product for $ 10 even with a gorgeous gift. The most you can do is try to raise his check by 20-30%.
X2 or -50?
The question often arises: which action is more profitable — “x2” or “-50%”?
There were a lot of experiments on this subject at Fotostrana. We have come to the conclusion that it is better to do x2 for superkits and whales. Their average check does not change, but the number of payers and the number of purchases increases.
For lower segments, it is better to make a 50% discount. This, of course, lowers ARPPU, but thanks to a strong increase in the number of paying users, you will either go into the plus, or you will remain at the same level in terms of income.
In “Caramels”, when we made massive -50% for low-paying and non-paying, we did not receive a very large increase in money, but we increased the number of paying, including those who had not paid for a long time and fell into the non-paying segment. After the campaign, some of these people returned to the paying segment.
Suggestions for triggers
When promotions are regularly held in the game (especially when there are a lot of them themselves), there is a threat that people will get used to them. For example, they will know that every Tuesday you have a “buy two positions at the price of one” promotion.
This leads to a drop in payments outside the promotion. The amount of lost payments will be equal to the peak of the promotion, or even exceed it. Therefore, you need to try to launch promotions as unpredictably as possible for the player.
A good option is trigger promotions.
A trigger is an event, a condition. If it has occurred, then a promotion or offer is launched.
For example, a person was previously paying, but recently stopped paying. At the same time, he continues to play. Then in the “Caramels” he gets an offer to make any purchase and get 2 hours of unlimited play as a gift. The purpose of this offer is to remind the player about the possibility of payment.
It is clear that segmentation can be used not only by the amount of payments, but also by behavior. And tie triggers on them, too.
For example, if a person is stuck at the level and got his nth loss, he can also be given a discount for a short time. Or even give a booster to push to the next level.
If a person was a superkit, but moved to the dolphin segment, he may get a personal X2 to increase the average check again.
To further reduce the predictability of the promotion, you can issue not one offer for one event, but alternate them or issue a promotion with a probability of 50%.
Flour for your own money
Finally, I will mention another very cool mechanics. It is great for selling soft currency.
The essence of the promotion is to offer the user to purchase a huge amount of currency at a low price (the price depends, of course, on the specific payment group). At the same time, the currency cannot be obtained immediately. It can be taken in small portions for a certain period of time.
We had a special button implemented in the interface for this. When it was pressed, the entry was counted and crystals were credited. If you didn’t have time to pick up the currency before a certain deadline, then it burned.
People bought because it was cheap. Then you have to return to the game regularly so that the currency does not disappear. This is a great tool to increase retention.
Usually a similar tool is used in relation to daily free bonuses. In fact, we decided to try to sell them.
At first we were afraid of user dissatisfaction, we honestly wrote about the condition. But there were no disturbances.
We launched this promotion once a month. The main share of purchases fell on the first two days. We observed a good result for about four months.
Then many realized what the meaning of the action was. Not everyone was ready to come in every day and pick up another portion of currency.
***
As a conclusion, I would like to say: do not be afraid to experiment. Constantly test various hypotheses and mechanics. Your task is to find the most profitable approaches for your own product. And remember: what worked for someone may not work for you. By the way, the opposite is also true.
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