Feature

Freemium versus premium bickering is pointless – the real shift is to games as a service

Freemium versus premium bickering is pointless – the real shift is to games as a service
An online/mobile expert since 1998, Oscar Clark is the Evangelist for gameplay video sharing tool Everyplay from Applifier.

Over the last two years I have been very outspoken about free-to-play, and I think it's time to review that.

It's not that I have lost faith - although I admit there are games out there which make me wonder if it's always a good thing. However, arguing the relative merits of premium and freemium has led us into unhelpful, almost religious, bickering.

I think it's the wrong emphasis, and that it hides a more important change – the move to games as services.

Are you being served?

We all know the old-school retail model is broken following the rapid rise of digital content, not just for games.

Of course a small number of triple-A console titles still make a huge amount of money, but it's a 'hit or miss' model. The bloating costs and resources required to build the next seminal title are immense, and so are the risks.

So is it any surprise that this has led to a dearth of creativity and an increasingly small range of game formulas? It's unlikely to get any better with the next generation consoles.

But the MMO market showed us how a small niche audience could be wooed into buying ongoing subscriptions. MMO success came down to sustaining audience engagement over time through social interactions, regular events and updates – and still having the anticipation of blockbuster content releases.

Zynga and Playfish applied this mindset to a more mass market audience using Facebook and simple social games. Of course, a number of mobile developers such as Backflip and Supercell have followed suit, utilising the freemium model along the way.

Never-ending

All well and good, but this change isn't slowing down. If we want to build the next successful game, we can't just copy the models of recently successful titles.

Players are learning about the nastier tricks and techniques used in different games and unless we change our focus from monetisation to delivering better service we may just lose them.

Think about every time you make a purchase. First you have to be 'sware' of the product, to have an 'Interest' and 'desire' for that item, and then have a reason to take 'action' to buy it.

But after the purchase we all experience buyer's remorse! In that moment after buying an item we realised it can't live up to all of our expectations.

However, the more engaged I am with the brand or service, the more likely I am to be willing to get over this initial negative reaction and enjoy what I have bought.

If I make the purchase in a safe context and have ongoing expectations of future value, the chances are that I will spend again, and again.

A whale of a time

That's how we find the 'Truefans', often wrongly labelled as 'Whales'. These are not people who spend cash for the sake of it.

They are payers who actively love your game and are happy to spend regularly because of the entertainment they receive. They are not crazy! If they feel exploited, they just stop playing and tell everyone how bad the game was – they don't keep on spending.

So the right question is not just how we make money, but rather it's about how can we engage every member of our audience more deeply at every stage in their lifecycle.

Why should they play the first time? What's in it for them to return time and time again? Why should they spend the first $1? Why would they spend $100 per month and still feel good about it?

This opens up an interesting conundrum. Is a player who continues to play without spending more valuable to you than someone who spends money only once?

I would suggest that too many one-time payers are a dangerous sign that your monetisation is badly flawed. Making lots of money from one-time purchases is good in the short term, but without repeat purchase we are in real trouble.

We have to stop thinking as players as being a type and instead look at them as a journey from discovery, to learning , earning and eventually churning. Our service design has to satisfy each stage and foreshadow the value of increasing their level of commitment to our game.

It's a subject I've spoken about at length before, and you can read more here, if you're interested.

Long-term

Moving to a service-based delivery has its consequences of course. We can't just complete a project, fire it off to the retailer and watch the revenues come in. We have to build a community of players and sustain them over time.

This is costly and resource hungry – around 80 percent of the service costs happen after the initial launch.

We have to create ongoing activity including events, content releases and feature updates throughout the life of the service and have processes in place to make this easy, reliable and (where possible) avoid having to take the game down each update.

Then we have to consider the social dynamics, deal with the emotions and politics that inevitably flare up in any passionate community, as well as the usual abuse moderation using all the social channels at our disposal.

In short we have to keep the game alive and there is no better way to do that than in engaging the community to help moderate itself. Few Indies have the resources or experience to do this well, but just considering these factors even at a small scale can save a lot of heartache later.

Service thinking and engagement-led design gives us a potential antidote to the hit or miss culture that has been at the heart of the decline of the triple-A console market, but it requires different game design skills to achieve.

We still have to build an exceptional game, stick to agile minimum viable releases and – if it's going to fail – make sure we fail early.

It's not a magic formula, but if your game idea is successful, this thinking will allow you to scale faster and make the very best experience for your customers – and one which they will willingly pay for.
To find out more about what Oscar's evangelising, visit the Everyplay website. To find out more about Oscar's minute-by-minute existence, follow him on Twitter.

Comments

1 comment
View options
  • Order by latest to oldest
  • Order by oldest to latest
  • Show all replies
Lloyd Melnick
Here is a great article from Forbes that backs up what you are saying by analyzing where the revenue is coming from on apps: http://www.forbes.com/sites/terokuittinen/2013/03/06/rovios-revenue-crisis-and-the-app-market-evolution/