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Monetizing Free-To-Play Gaming Models
eldavojohn writes "Last week, a game consultant named David J Edery gave his two cents on why free-to-play (F2P) game models aren't as prolific in the West as they seem to be in the East. Aside from a few unprovable cultural divides, he makes some interesting claims concerning conversion rates of non-paying players to paying players. Some customers pay hundreds for functional items and only a dollar on aesthetic items while other users might be the complete opposite. He also notes that converting a non-paying newbie into a paying customer is not the same as converting a non-paying salty dog. He defines 'aggressive monetization' to mean how much money will advance you 'unfairly' in the game. He focuses on two classes of items: those that provide performance-neutral aesthetics and those that provide performance enhancing or functional advancements. He claims to have access to ARPPU ('average revenue per paying user' per month) rates among several game developers and states that 'more aggressive monetization model and a loyal, niche userbase can hope to generate $50 per paying user per month, on average,' while 'a F2P game that limits itself to flat subscription revenue and/or non-functional items is generally more likely to fall somewhere between $5 and $10 per paying user per month.' Like any good consultant, he also gives ethics a footnote in an otherwise verbose post on monetizing free to play games. Has anyone here had experience pricing items and content in free-to-play games?"
Golfers spend considerable money on things which are supposed to improve their game. It's usually mediocre players buying stuff that won't help them. There's a lot of that in running shoes, too. (Much to the annoyance of Nike, their sponsor, the Stanford University track team trains running barefoot.)
I've played numerous F2P MMORPGs (at least 20) that operate on a micro-transaction model. While many of them were not good enough games to justify payment of any kind, those that have gotten to my wallet have done so in varying degrees. I have sunk over $400 each into three separate games, and one of those three has exceeded $1000. If you take the $400 figure, even at a $15/mo subscription [above average for a subscription based game], I have paid the equivalent of over 2 years of subscription time to each of these three games. I am not an exception to the rule. I have met multitudes of people in each of these three games that have invested at least as much as I have, and no shortage of people who have invested at least an order of magnitude more into them. For each person who isn't paying, I can assure you, someone is making up for it enough to turn it into a major profit.
When I was a kid, they had free-to-play games in the arcades. This was where you stood in front of the machine and pressed buttons while the demo played.
Dear god I didn't realize it would remove every newline I inserted manually.
The economic anarchy of capitalist society as it exists today is, in my opinion, the real source of the evil. - Einstein
After reading the article, the author seems to simply not talk about two things (at least as related to conventional MMORPGs).
First, he doesn't address the question of the effect of monetization on player base. In his HappyFunTime example, for instance, he blithely assumes that both monetization systems have the same number of players. But is this true? I know many players who actively avoid games with aggressive monetization systems, especially those where the best items are available only via RMT or where progress beyond a certain point requires RMT purchases (which is not related to whether or not you can continue to play forever for free, it's a question of whether, eg., access to the best end-game instances and raid zones requires paying or not). Their thought is that games aren't a paying job for them, and those sorts of games are going to be dominated by professional players for whom the game in fact is a paying job (they either make money off of player-to-player RMT if allowed or they're employed by a plat-farming and/or power-leveling service) They're also wary of putting time and effort into developing a character in a game where their progress and ability to play with their friends may be randomly blocked by the vagaries of real-world finances (eg. your friends want to run a raid but this week your checking account just doesn't have enough in it to pay for access to that raid zone). For them it's safer to stick with games with a less aggressive monetization model, ones where they won't have those problems.
Second, there's the question of how well the player base will stick with the game when economic times get tough. We're going through a time like that right now, for instance. I'd think that when times get tight players will abandon games that effectively mandate out-of-pocket costs (ie. have aggressive monetization models) every month more readily than fluff-only or flat-subscription games. In games where RMT gets you fluff-only items, you can cut your out-of-pocket costs quickly and decisively without seriously impacting your game experience. In flat-subscription games, you don't even have to worry about your cost level since it's going to remain steady and predictable. If you can afford to play at all, your play experience doesn't depend on how much you're spending. My experience has been that those things create a player base that finds the game a better value for the money and that'll be less likely to drop it than other things when their entertainment budget starts to get squeezed. IMO designing a game that's highly vulnerable to economic ups and downs is a more risky proposition than designing one that's attractive even in the bad times.
There's probably more, but that's the ones I've seen.
You are attempting to create an argument where there isn't one. There is no NEED for a 'behemoth' free-to-play game, and I don't see where anyone was saying that there needed to be one. Free-to-play games don't have to be massive to succeed at making money, which is the whole point.
In addition, you're making the assumption that WoW is successful because it isn't free to play -- instead of the fact that it had a marketing behemoth (worldwide), an extremely popular brand name (worldwide), and a very highly praised development team (worldwide) working behind it.
Furthermore, if you WANT to see sizable Free-To-Play games, they're out there if you look. You also mention 'lifetime' subscriptions to LotRO -- a game that is in the process of converting to free-to-play precisely because of the success of DDO's free-to-play conversion that the company already had.
>Why pay more for lesser games?
Who decides they're lesser? Subscription numbers are meaningless to personal tastes. I've had more fun playing free-to-play games than any retail subscription game - and not for lack of trying them. I've had active subscriptions at one point or another to approximately half of the mainstream subscription MMORPGs in the west.
Another benefit of free-to-play games: When I'm struggling financial, I can still play and just stop paying.