Over the years, there have been plenty of interesting attempts to rethink user acquisition.
Social platforms such as Facebook, Kakao and WeChat have been very successful, while game-specific platforms - GREE, Mobage - less so.
Incentivisation has always been an option, and perhaps it's finally found its place with the clean value proposition offered by video ads.
Yet many companies still complain about the cost, weak targeting and lack of transparency of user acquisition.
So, with that in mind, we asked our Mavens;
Do radical proposals, such as TinyLoot's move to roll a platform that will enable developers to pay gamers to play their games, have their place?
Or is UA now a mature, commodity market that only scales for companies able to spend $100,000 daily?
John is co-founder of PR and marketing company Big Ideas Machine. Also an all-round nice guy...
UA in mobile games remains fundamentally broken because there is still little or no notion of brand building within the mobile games market from anyone except the big and cash-rich publishers.
Put simply, if all developers and publishers continue to rely on paid-for UA advertising as their sole source of customer acquisition then we have a problem.
This model exists on the web in the form of affiliate marketing and works well - big companies like Sky and BT (cable TV and telephone/internet providers to any non-UK readers) have online advertising campaigns that site owners/publishers can show and then these people get paid if someone signs up to a service via their site - it's a bit like the pay per install/per download model we see currently.
UA remains fundamentally broken because there is still little or no notion of brand building.John Ozimek
BUT - if this was the only effective way to drive UA, then these companies would only do online affiliate marketing and nothing else. Clearly it isn't, as all of these companies invest large sums in brand building.
These companies put up billboards and advertise in magazines and run social media campaigns and engage PR agencies because they know that marketing is about a mix aimed at a cumulative effect that creates an emotional attachment to a brand that will (hopefully) lead to influencing a purchase somewhere down the line.
It doesn't really matter what the specific of the incentivised UA is, as the issue is the continuing focus only on paid UA as the holy grail of generating downloads.
It's welcome to see continuing experimentation, and hopefully new services will appear that work alongside the app stores to aid discovery and awareness. I must say that having not seen it for myself, the idea of paying gamers to play your games does remind me of the MVNO Blyk, which closed down several years ago - paying someone to play a game is not the same as turning them into a fan. I will need to be convinced.
Ultimately, until the mobile games market begins to mature and move away from its purely commodotised/transactional basis that UA works on at present, then we cannot expect things to develop and evolve.
It's not broken. It's just how it is.
You either engage with it smartly and grow or you don't.
Have to agree with Will on that one.
Effective UA in itself is nothing more than mobile CPM advertising with the goal of generating demand for your game. Maybe we should stop calling it "user acquisition" and go back to performance marketing? For some reason, many tend to be allergic to the term.
I am a fan of accountability. And finally mobile games marketers are highly accountable for their budgets.Wilhelm Taht
Personally, I am a fan of accountability.
And finally mobile games marketers are highly accountable for the budgets that are placed on marketing (remember the WAP deck space era, anyone?).
That we're backing out the cost of acquiring a single user seems to give it a nasty ring. From a cost perspective however, it is often times the only rational choice to start with for a well monetizing f2p game; it's ROI+ when applied right.
John is right though, it's not the only choice. But going in guns blazing with a massive marketing mix is just not feasible with the marketing budgets most mobile games studios are equipped with. But look at where the bigger players are going now.. Rovio, Supercell, King etc.
As for TinyLoot's move. Let's see. It's not the first player incentivised approach (Tapjoy, W3i (NativeX), Fiksu's FreeMyApps etc.etc.), and certainly not the last.
TinyLoot will likely need quite a bit of steam to build up both an audience as well as the games to feed to that audience. Hope it works out well.
Jason Della Rocca is the co-founder of Executions Labs, a first-of-its kind, hybrid game incubator and go-to-market accelerator that helps independent game developers produce games and bring them to market.
Formerly, Jason was a game industry consultant focused on business and cluster development, working with game studios and organizations all over the world.
Prior, he served as the executive director of the International Game Developers Association (IGDA) for nearly nine years, and was honored for his industry building efforts with the inaugural Ambassador Award at the Game Developers Conference.
In 2009, Jason was named to Game Developer Magazine’s “Power 50,” a list which profiles 50 of the most important contributors to the state of the game industry.
As a sought after expert on the game industry, Jason has lectured at conferences and universities worldwide. He also serves on various advisory boards and volunteer roles, such as co-chairing IGDA-Montreal, as an advisor to the ICT Practice of Foreign Affairs, Trade and Development Canada, and serving on the research management committee of the GRAND Network Center of Excellence
Ya. It just seems futile to complain about UA hell.
John's comments on brand/community building strike a chord. Makes me think there's some hybridization of the old publisher brand-building model (to convince players to put down $60 for a game upfront) versus the completely promiscuous nature of free-to-play.
Which then also brings up the whole debate around being independent and still needing a publisher...
Which also makes me think of the value of building a cult of personality (and fan base) around specific developers and designers.
But alas, then that leads us down the whole trolling hell from this past week. Wow, UA sucks.
The industry created this situation with UA and pushed it to these bizarre heights. It's a hamster wheel that everyone is afraid to get off and is not sustainable in the long term. Paid-to-Pay is the next bold leap forward in this lunacy.
Candy Crush and Clash of Clans are not super popular because of UA strategies, they are popular because people like those games. UA probably plays some role in that but it's got to be a minor role otherwise anyone that adopts the same UA strategy would have the same type of success.
[UA is] a hamster wheel that everyone is afraid to get off and is not sustainable in the long term.Dave Castelnuovo
UA can be valuable to spark a fire under an app (and stoke it every now and then) but anything more than that is an artificial boost.
If the game can't be viral by organic word-of-mouth on its own then you're whipping a dead horse by paying users to download it. The problem comes when you have so many companies out there adding artificial boosts to their games on top of organic virality and that makes everyone feel like they have to play that game.
And it makes more than a few games appear to succeed that don't deserve that success ahead of others that are drowned out by a big artificial pool of subsidized content.
I know it's hard to accept when your game doesn't become the breakout success you expected and you blame things like not being able to spend enough on UA or that discovery is broken, but it would be healthier for the industry to allow games to survive more on their merit than on their advertising budget.
When the industry becomes too dependent on aggressive UA, discoverable apps are not decided by what the audience wants but by which games a large company needs to push in order to be accountable to their shareholders (whether they are good games or not).
If this becomes too dominant, then people will lose interest in the industry similar to the way people lost interest in Facebook games.
Unfortunately there are no short term market forces that can keep this behavior in check (except for maybe Apple policy).
CEOs are incentivized to take it one game at a time and rack up numbers now and worry about the future later. If they accidently make a game that's a stinker, they have to find a way to at least make it look like it's a success otherwise they won't be able to make it to that all-important acquisition or public offering.
But like we've seen so many times before, once the company does go public, the smoke and mirrors are stripped away and the CEO is asked to step aside so others can fix the mess.
Although maybe that's a good thing for the CEO since they can walk away from the responsibility along with their big bag of money...
UA is not broken at all. Some companies don't need to make profits and cannot innovate - that's all.
Building up your user base naturally feels old school but it's way more healthy.Christopher Kassulke
For HandyGames, a sustainable business model is more important than short term revenue boosts thru heavy UA. We saw a lot of company stalling in revenues as soon they stopped spending heavily in UA.
So building up your user base naturally feels a little bit "old school" but it's way more healthy in my personal opinion.
I like the approach of TinyLoot's paid-to-play. I said this would come after free-to-play... sooner or later we as developers have to pay the consumers to pay our games… crazy world.
It's up to every developer to go their own way. Let's see who have chosen the right one for the long run. Premium, paymium, F2P, ads, P2P, etc. So many choices….
My overall view (and deep concern) about UA is that industry thinking as a whole (not just devs/publishers) is far too influenced by short-termism, both in terms of how it goes about getting people to play its games but also in terms of the nature of those games.
To my simplistic mind; UA (and discovery in general) IS 'broken' when:
- Publishers make games that are worth playing but cannot generate sufficient revenue to break even either because they can't do so at a commercially-viable cost per user, or because they simply cannot reach enough players.
This is at the core of the main conversation around UA in the industry right now. It is valid but ignores one vital viewpoint; that of the consumer.
- Players cannot find the games that they truly want to play and which they will enjoy playing for a sustained period.
What marketing/UA approaches/platforms start with the question; "How do we help players actually find the best games for them?" Very few is the depressing reality!
John Ozimek said "Put simply, if all developers and publishers continue to rely on paid-for UA advertising as their sole source of customer acquisition then we have a problem."
He's right, however the trouble is, all developers and publishers HAVE to rely on paid UA right now if they are building larger-scale games with a F2P model for distribution via an app store. No other marketing strategy (that can be engineered) quickly delivers sufficient user install volumes and velocities, unless you are simply very frikkin lucky.
UA rates (e.g. CPIs) are dictated by the finances of larger publishers and with mainly large-scale F2P games, thus the cost of UA for smaller scale games (F2P or premium), which may only need a fraction of the revenue to be commercially viable, becomes unsustainable.
Smaller studios lose out. The mobile game-playing consumer audience loses out (from lack of variety and creative innovation). Targeting is weak because the free-to-play model needs a tremendous throughput of users for a sustained period. There are not enough players that ads can reach on a daily basis that will fit anything but a broad demographic.
'Incentivisation' is, in theory, terrific if it is transparent, intrinsic and positive in nature. But when it simply means 'reward me with something I want to download a game I actually don't want', it is horribly unsustainable and for a number of reasons.
The only long-term way I can see to overcome these issues is for services that connect gamers and games to develop which are not based on a paid-for promotion business model.Kevin Corti
Firstly, if you can pay a company to 'incentivise' a user to download your game, and if that approach genuinely works, the net result is that the market forces simply dictate that the cost per user escalates to that of other UA approaches so no benefit there.
Secondly, it is based on the foundation that you get enough download velocity to achieve app store chart visibility (and maybe social/viral awareness) but you need a huge amount of 'fake' users to achieve that over a sustained period across the country markets that count so you are back to the issues of it costing shedloads of money and hence can only work for large-scale F2P games (that also happen to be good!).
This also all smacks of the early days of when Offerpal (now Tapjoy) 'incentivised' users on Facebook. It was all very dirty and borderline criminal and not a characteristic of the industry I personally want to see flourish.
Thirdly, Apple hates incentivised UA methods that 'subvert' its charts so the likelihood is that games that use incent networks APIs or apps from those networks) will be banned.
All of these problems and shady tactics exist for one reason; that the ways in which the billion gamers can become aware of the games they want to play is fraught with a lack of economic incentive, technical inefficiencies, barriers, friction and ineptitude.
When discovery is only (mainly) derived by paying for it, then there is no economic incentive for anyone to make it cheaper and easier to provide UA. There isn't going to be a price-cutting war amongst advertising companies any time soon!
The app stores don't care about individual players, individual developers or the long tail. They just need enough shiny-looking games in the front of the store/top of the charts to sell devices (Apple) or propagate their OS (Android).
The only long-term and positive way I can see to overcome all of these issues - and to thus foster a much healthier ecosystem - is for services that connect gamers and games to develop which are not based on a paid-for promotion business model and which start from the point of helping the consumer.
I should declare that I am working on one such service, where effective app store search and personalised recommendation drive what consumers find and where no ad money or cozy platform relationships can influence that process.
Oscar Clark has been a pioneer in online, mobile, and console social games services since 1998. He is also author of the book, Games As A Service – How Free To Play Design Can Make Better Games.
Making this about a wider UA debate has of course brought us all out of our shells... and rightly so.
Whilst Will is right about UA being 'how it is so stop moaning and get on with it' - to paraphrase - John is also right and again to paraphrase we are 'obsessed with paid acquisition'.
This isn't a new thing. It's about marketing understanding the four Ps of marketing and we need to apply all four appropriately.
Price (at least to access) has of course already fallen to zero, unless your game is clearly communicate enough added value to encourage players to pay upfront. But that needs us to employ the other three Ps.
We have to ensure that our Product is intrinsically delightful. Games like The Room or Monument Valley capture a moment of anticipation and deliver on their promise in spades. They also made sure that they effectively communicate those inherent product values through press and social media.
However, FreeToPlay need longer term retention. Games like Clash of Clans and Subway Surfers do that amazingly well by building ongoing predictable anticipation with each new updates/event which builds an engaged community.
That doesn't happen overnight and you have to have an appreciation of the lifecycle of your players to pull it off. That's the kind of thinking I'm trying to teach designers in my upcoming UKIE masterclass
Community and the application of social networks becomes an alternate, distinct channel or Place (our third P) in its own right. But of course the dominant Place is still the Apple/Google app store and as has already been said Apple (understandably) doesn't like other people playing with their toys, unless its under their terms.
The dominance of these app stores combined with the almost frictionless delivery of new content means that their stores have become very noisy and hard to differentiate (unless you are featured). However, it is still possible to get some value through other media including consumer and trade press - although their impact is of course harder to measure.
Candy Crush and Clash of Clans are buying TV slots presumably to further increase their reach but this also helps with brand marketing. Not everyone can afford to do that. However, why not think about other ways you can reach out to an existing community.
If you have a game with an existing audience make sure you reach out to them where you can. Even if there isn't a specific related audience perhaps you can find people with related interests for example events like PAX or MCM Comicon attracts thousands of people who have an interest in comic and gaming culture.
Finally, we can't ignore the last P - Promotion. Performance ads aren't the only way to get results, but they are extraordinarily effective for games - that's why we are obsessed.
There is almost no distance between the advert and getting the game on our phone or tablet. That's a frictionless purchase. Add to that our ability to target our audience perfectly - people playing other games and we have an almost perfect storm.
However, the cost has exploded and reading the Fiksu blog I understand the Cost per Loyal User Index has risen 34% year-on-year.
We used to use ads for creating awareness and brand building, but for mobile this is arguably undermined by a single focus on UA volume. We look for ads which convert the most users before we consider what that imagery/placement does for our games brand.
In contrast to this the rise of video has been particularly poignant, especially for me working with Unity Ads, where I've seen the benefit of opt-in as a positive experience for users and advertisers.
I mention that not just to do a bit of self-promotion but because clearly the use of incentives is an important one for this topic. The provision of in-game incentives is very different from real money and in my experience delivers vastly better quality users than when real money is involved.
The reason is fairly simple; an in-game incentive drives engagement with the user. Money rewards are driven by a desire to get money. They absolutely have their place in the mix - and I wish TinyLoot every success - but for me there is the risk that they may activate the wrong motivations if it's just about the money.
Adam has been in the mobile game industry since 2007, creating games independently. He's since grown into a full 50+ person studio manager.
Recently he's taken a position at Wooga in Berlin to sharpen his design skills and work with the world's best to create amazing, well-crafted products onto the mobile marketplace.
In mobile free-to play games, you can't have long-term stability on the top charts without spending money on UA. But spending money on UA will only help you if you have a great game.
I think that the notion of UA "being broken" comes from the massive entry barrier for newcomers and small players in today's app stores. A few years ago, the threshold to enter into the mobile F2P world was negligible. Marketing a mobile game was as simple as picking up the phone, calling a free game promotion company and buying a couple of thousand dollars or euros worth of promotion... Those times are gone.
UA is required for building long-term volume.Adam Telfer
Today, there is so much more money to win and naturally the stakes are much higher.
If you think that UA is used mainly for short term bursts, I don't believe you. Companies just dumping money for short-term revenue have faded away or will do so eventually; it's just fundamentally a terrible business model.
UA is required for building long-term volume. If done right, it is what makes your game successful and float in the top ranks.
This trend of CPIs rising will continue. Companies are getting smarter and smarter about F2P and optimizing LTV. They can afford this escalating cost. That's the nature of the highly competitive business we work in.
Can a small independent company now realistically compete within the top charts?
I think it's very unlikely. The first hurdle is game quality - the games at the top are amazing games that will be difficult to beat. But the second hurdle will prove much more difficult - and expensive. You have to play the marketing game: Get a feature, make it viral, and/or pay for marketing. I don't see any other options. If you don't have the funds and the UA expertise then you will be forced to try to make small profits with a much lower volume of users.
To answer your question :
The high entry barrier and the rising cost of marketing confirm that we are definitely operating in a mature market, making it extremely hard for small players to compete.