How Free-to-Play Game Developers Keep Their High Rollers Hooked
"How to Retain Whales" was the grossest session at GDC.
The line for the "How to Retain Whales" sessions was huge. Image: author
"Who are these players that are spending thousands of dollars on virtual items?" Akio Bandle, who does business and marketing strategy for mobile game developer and publisher npnf, asked a packed room at the Game Developers Conference.
"I heard that will.i.am dropped $25,000 on FarmVille in a single day and I'm sure his accountant wasn't crazy about that," he said. "You hear about the trust fund babies or the Arab sheikhs who are dropping $10,000, or the fact that FarmVille was bankrolled by Midwestern soccer moms. And there's truth to every stereotype I guess, but the fact is that anyone can become a whale."
The whales Bandle referred to are those players who spend disproportionately high amounts on so-called "free-to-play" mobile games. The term was adopted from casino parlance, where it signifies a gambler with a lot of money to bet, which is to say a lot of money to lose. Mobile games don't count as gambling, mostly because the player has no money he could potentially win. But as their own terminology reveals, mobile developers use a lot of the same strategies to keep players spending money on in-game items to play a game better and faster.
They're hugely important to the mobile, free-to-play gaming business. Bandle says that some of npnf's games, such as Ærena and Galaxy Battle, see most of their revenue from the top 50-100 spenders, and that some will spend six figures on a game in as little as three months. Npnf is not nearly as big as the most successful mobile developers, but it also helps other developers create and monetize virtual goods with its proprietary APIs.
Some of npnf's games see most of their revenue from the top 50-100 spenders
GDC is mostly filled with fascinating, inspiring panels. Yesterday, Zoe Quinn discussed humor in games, game designer and author of A Theory of Fun for Game Design Raph Koster talked about how to manage online communities in a middle of a culture war, and a bunch of indie developers advised their peers on how to enter the world of virtual reality development.
But the biggest line I and the event organizers I talked to saw at the show so far was for Bandle's session, "How to Retain Whales." The 219-person capacity room filled up before the session even started, and the line stretched out the door and looped in on itself, with people just waiting and hoping to grab a seat or standing room in case someone left.
Inside room 2014, Bandle described one ingenious way to harpoon and pull back the whales who are trying to get away. "Back in the day we'd run queries to indicate which whales were losing interest in our games, and they'd be on our endangered watchlist," he said. "If they haven't logged in for a while we'd actually contact players with generous 'starter' or 'booster packs' [think of it like a free stack of chips at the casino] to try one of our other titles."
The thirst for gems is real.
Npnf also knows which games to herd the players into next because it collects as much data as possible on player behavior. If they're playing aggressively—constantly raiding other bases in Clash of Clans, for example—you'd be wise to put in-game ads in front of them for a first-person shooter. If you see that players are paying more to build out their virtual cities, offer them more upgrades to buy. If they enjoy customizing their avatar, sell them more customization options. And with a large enough user base, you can of course A/B test all these devious strategies to perfection.
China, Bandle said, is way ahead of the West on all of these strategies. He said that it's common for Chinese mobile game developers to have full-time VIP services, with entire teams devoted solely to their whales. Some VIP services have 24 hour phone customer service, and others even had staff members who are paid to play and challenge whales to keep them entertained.
Another really clever system, Bandle said, is Clash of Clans's clan system, where clan members can send each other reinforcements. Clash of Clans, a strategy game in which players can pay or wait to build their bases and attack other players, is one of the top grossing free-to-play games on the mobile app stores. It reportedly made as much as $5 million a day for developer Supercell.
Bandle said that it's common for Chinese mobile game developers to have full-time VIP services
"A lot of those whales are not just spending on themselves, they're also spending to help out their buddies," he said. "At the highest levels you'll see whales financially sponsor their clan members with thousands and thousands of dollars. These types of whales see themselves as leaders or benefactors of their clans."
There's nothing illegal about any of this at the moment, but it's very obviously predatory, and people are starting to catch on. Last year, the United Kingdom's Office of Fair Trading issued guidelines free-to-play game developers had to follow because the agency had concerns over "industry-wide practices that were potentially misleading, commercially aggressive or otherwise unfair."
In the United States, following an FTC complaint and a $32.5 million settlement to parents who claimed they didn't know their kids were spending so much money on virtual goods, Apple has taken it upon itself to open the "Pay Once & Play" category in the iTunes App Store, which filters out games like the one Bandle's describing.
Both the National Council on Problem Gambling and youth gambling experts have said that free-to-play games are a growing problem, and that they treat the people whose life are ruined by them just like any other gambling problem.
In room 2014, game developers were openly discussing the most efficient ways to keep separating players from their money. "Maybe they first install Game of War because of Kate Upton," Bandle says and the room laughs, referring to the Super Bowl and Twitter ads for the free-to-play mobile game. "But that's not what gets them to stay and pay."