(AFF201) What the Top 50 Games Do with In-App Purchasing That the Rest of Us Don't | AWS re:Invent...

November 12, 2014 | Las Vegas, NV

AFF201

What the Top 50 Apps Do with IAP

That the Rest of Us Don’tAnd How Playtika Uses This Knowledge to Maximize Revenue

Mike Hines, Developer Evangelist, Amazon

Salim Mitha, EVP Product + Monetization, Playtika (Caesars Interactive)

• How the top 50 did vs.

the rest of us

• What the top 50 did

differently

• How Playtika uses

Top 50 strategy

3

The Amazon Appstore reaches millions of customers in 236 countries and territories worldwide

Android

Fire phoneKindle Fire

Fire TV and Fire TV Stick

BB 10

Group A: Top-50 Grossing

Source: Amazon Appstore, March 2014

Group B: Rest of Freemium


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100100

installed


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Iiiiiiiiiiiiiiiiiiiiiiii

iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii

iiiiiiiiiiiii

4142

In

active

5958

active




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Iiiiiiiiiiiiiiiiiiiiiiii

iiiiiiiiiiii1318

uninstalled

5958

active


iii



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iii

iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii


iiiiiiiiiiii1318

uninstalled

5958

active

33

paying

2.62.9



iii



iiiiiiiiiiiiiiiii


iii



iiiiiiiiiiii1318

uninstalled

5958

active

33

paying

# of sessions / active

session length / active(minutes)

× =

avg. session length(minutes)

6.97.4

1822

6.97.4

2.62.9


iii



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iii



iiiiiiiiiiii

=×

# of items / paying

100%

112%

avg. selling price

100%1

36%

10

0%

154%

ARPPU

1318

uninstalled

5958

active

33

paying



× =


1822



ii

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iiiiiiiiiiiiiiiiiiiiiiii


ii

Iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii

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×


1725

uninstalled

3437

active

11

paying

=×

# of items / paying

100%

106%

avg. selling price

100%107%

10

0%1

14

%

ARPPU

6.77.7

3.23.5

21

27=



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iiiiiiiiiiiiiiiiiii

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×


1928

uninstalled

1923

active

=×

# of items / paying

100%

107%

avg. selling price

100%122%

10

0%13

1%

ARPPU

2.6

3.2

1525

=



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iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii



iiiiiiiiiiiiii

iiiiiiiiiiiiiiiiiiii



×


2032

uninstalled

1418

active

=×

# of items / paying

100%

102%

avg. selling price

100%1

21%

10

0%1

24

%

ARPPU

5.77.4

2.63.215

24=



iiiiiiiiiiiii

iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii



iiiiiiiiiii

iiiiiiiiiiiiiiiiiiiii



×


2134

uninstalled

1014

active

=×

# of items / paying

100%

111%

avg. selling price

100%

108%

10

0%12

0%

ARPPU

5.77.3

2.53.1

14

22=



iiiiiiii

iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii



iiii

iiiiiiiiiiiiiiiiiiiiiiii



× =


2236

uninstalled

48

active

=×

# of items / paying

10

0%

103%

avg. selling price

100%

128%

10

0%

13

1%

ARPPU

5.97.3

2.43.1

14

23


Hours Since App Download


0 24 48 72 96 120 144 168 192 216 240 264 288

Days User Owned App

80%

90%

100%

110%

120%

130%

140%

150%

160%

170%

1 4 7 10 13 16 19 22 25 28


+60%

average

selling price

What the top 50 do differently

REVENUE

?GIVE THEM A

REASON TO

COME BACK

MAKE IT

EASY TO

COME BACK

ENGAGE

CUSTOMER

EARLY


Apps with tutorials that introduce IAP

items

HAVE A 2.5x HIGHER

CONVERSION RATE

Apps that show users how to “consume”

GET MORE REPEAT

ORDERSGames that provide a post-purchasing tutorial

generated 65% more repeat orders than the

market average.


69%

100%

145%

1-5 Items 6-10Items

11-15Items

Games with bigger selection

RECEIVE MORE ORDERS

PER CUSTOMERDevelopers that add new items regularly are able

to re-engage their paying customers, and

developers who differentiate offers for long-time

customers sell more items at higher prices.


147%

101%

52%

0%

50%

100%

150%

200%

1-5PricePoints

6-10PricePoints

11-15PricePoints

Don’t confuse your customer

OFFER VARIETY,

BUT NOT TOO MUCH


To sell more IAP items,

BE CLEAR

ABOUT VALUEMake it obvious what the

benefit is for buying different

price items. Confused

customers don’t buy anything.


To sell more IAP items,

BE CLEAR

ABOUT VALUEMake it obvious what the

benefit is for buying different

price items. Confused

customers don’t buy anything.


Total Marketplace: Assortment by Price Point


31%29%

7%

12% 11%

5%3%

1%

14%11%

6%3%

16% 16%

11%9%

0%

10%

20%

30%

40%

0.99 1.99 2.99 4.99 9.99 19.99 49.99 99.99

% of Assortment % of Sales

Most of us have too much

CONCENTRATION ON LOW PRICES


Top 50 Apps: Assortment by Price Point

28%

15%

10%13%

11% 9% 9%

5%

32%

19%

7%4%

10%12%

5% 4%

0%

10%

20%

30%

40%

0.99 1.99 2.99 4.99 9.99 19.99 49.99 99.99

% of Assortment % of Sales

We find that the

TOP GAMES ARE MORE BALANCED

Games with bigger selection

RECEIVE MORE ORDERS

Tutorials that teach buying and using

HAVE HIGHER CONVERSION AND REPEAT ORDERS

Highlighting customer value

MAKES IT EASY TO SHOP

Cater to your best and longest customers

DIFFERENTIATE YOUR IAP CATALOG

Tuning Game Difficulty

WILL ENCOURAGE

LONGER SESSIONSToo hard, and users will abandon. Too

easy, and they can get bored. Just right,

and it becomes addictive!

Adopting Social

CAN CREATE BUZZ AND

KEEP USERS ENGAGEDThis will result in more friend-to-friend marketing as

players share their achievements and ranks.

Players will also compete with friends and leaders

and stay engaged.

Leaderboards and Achievements are

THE MINIMUM BAR FOR SOCIAL ENGAGEMENT

Design IAP into the fabric

of your game

MAKE IT EASY

TO BUYOffering ways to buy your IAP

items when they are needed

will increase conversion.


of your game

MAKE IT EASY





of your game

MAKE IT EASY




Apps that made it easy to shop

INCREASED REVENUE 75% (ARPPU)Source: Amazon Appstore, March 2014

Increase time and count of sessions

TWEAK GAME DIFFICULTY & ADD SOCIAL

Increase engagement with IAP

INTEGRATE IAP INTO APP DESIGN

Know. Don’t guess

IMPLEMENT A|B TESTING

How Playtika Implements Top 50 Strategy

Two big

MARKETING QUESTIONS

How much can we pay for traffic?

What is our “Payback period”?

What is going on with Daily Active Users?

How can we grow it?

Assumptions about

PAYBACK PERIOD

First 7–14 days is critical

(for monetization & payback)

Game follows a typical arc

Reality about

PAYBACK

PERIOD

Month 2 is super critical

Our LTV is spread out over

many months

“Evergreen” game &

“evergreen” content

Assumptions about

DAILY ACTIVE USERS (DAU)

Black magic

Most of the DAUs are from recent

acquisition activity so we need to keep

topping up the funnel

Reality about

DAILY ACTIVE USERS

Over 33% of our players have

played 2+ years!

60% of our DAU comes from

players over tenure > 1 year

Retention & reactivation

matters

DAU Composition by Install Cohort

Tying back DAU & Buyers – How “potent” is our DAU? Very Cool Metric: Percentage % of DAU that are Payers

17%

18%

19%

20%

21%

22%

23%

Percentage of of DAU that Payers

To make a game profitable

RETENTION MATTERS

With good retention and reactivation

YOUR PAYBACK PERIOD IS LONGER THAN YOU

THINK

Understand your Daily Active Users

KNOW % OF DAU THAT ARE PAYING CUSTOMERS

Two big

MONETIZATION

QUESTIONS

Who are our buyers?

Are they gonna go away?

Should I run a sale?

Or am I training users?

Will I get a Revenue Hangover?

5220% of Buyers represent 90% of Revenue

6%

14%

81%

65%

24%

11%

Buyers % Revenue %

Med

Low

High

Importance of our VIP Payers

WHO ARE OUR BUYERS?

REVENUE PARETO PRINCIPLE

+93% YoY growth +59% YoY growth

0

10,000

20,000

30,000

40,000

50,000

60,000

High Spenders Cohort Population

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

Medium Spenders Cohort Population

The problem with revenue/user concentration:

ARE THEY GONNA GO AWAY?

Metric: Buyer Cohort Size Growth

83%

55%

87%

65%

90%

74%

0%

20%

40%

60%

80%

100%

PLAY PAY

High Spender Play & Pay % over the last 30 / 60 / 90

Days

Play - 30 Days Play - 60 Days Play - 90 Days

65%

29%

71%

38%

76%

47%

0%

20%

40%

60%

80%

100%

PLAY PAY

Medium Spender Play & Pay % over the last 30 / 60 / 90

Days

Play - 30 Days Play - 60 Days Play - 90 Days

Fostering good growth

HOW ACTIVE ARE OUR BUYERS?

Metrics: 1) Play % over the last 30/60/90 days

2) Pay % over the last 30/60/90 days

Monitor and create offers for new buyers

Daily New Buyers

+25% in

FTB

Let’s not ignore our non payers…

FOCUS ON FIRST TIME BUYERS (FTB)

Is it a good idea?

SHOULD I RUN A SALE?

We looked at:

% of revenue coming from

Normal Payment Page vs. Sale Page

Staggered sale dates for unpredictability

Metric: Average Currency Balance of Payers

• When balances are low, the timing is right

• Content cadence is critical here

When is

THE RIGHT TIME TO RUN A SALE?

Metric: Absorption and Velocity of Paid Sale Currency

74.6%

49.0%

11.4%

27.1%

4.9% 19.5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Normal Day Sale

Money supply can

IMPACT FUTURE REVENUE

Jan-1

3

Feb

-13

Ma

r-1

3

Apr-

13

Ma

y-1

3

Jun-1

3

Jul-1

3

Aug-1

3

Sep-1

3

Oct-

13

No

v-1

3

De

c-1

3

Jan-1

4

Fe

b-1

4

Ma

r-1

4

Apr-

14

Ma

y-1

4

Jun-1

4

Revenue Trend(Daily Max, Min and Average)

Max Min Average

Sale Timing + Content Cadence

HANGOVER

MANAGEMENT

Look at the Min & Max

Steadily increase Min

Understand what your users are doing

USE ANALYTICS

Does 90% of revenue come from 20% of your buyers?

MITIGATE CONCENTRATION RISK

Optimal sale timing is…

WHEN HARD CURRENCY BALANCES LOW

To prevent sale hangovers

PAIR SALES WITH NEW CONTENT

Metrics: Conversion, Monthly Buyers & ARPPU

Monthly ARPPU

Follow the best practices of the top 50

Bottom Line

BRINGING IT ALL TOGETHER

Most of your revenue will come from long-term users

DIFFERENTIATE YOUR OFFERS

Encourage longer sessions, long-term use, greater conversion, more reorders

USE A|B TESTING TO TUNE APP YOUR APP

Reduce revenue concentration, increase long-term payers

MAKE OFFERS JUST FOR LONG-TERM NON-PAYERS

Keep users engaged and encourage conversion

COMBINE SALES AND CONTENT UPDATES

TO LEARN MORE…

…about the Amazon Appstore and APIs that can

help you monetize, visit the Amazon Dev Portal:

http://developer.amazon.com/API

Next Sessions:

Wed 2:15 in Delfino 4105

AFF302: Responsive Game Design

Thur 11:00 in Murano 3304

AFF202: Everything You Need to Know about Building Apps for the Fire Phone

Thur 4:30 in Murano 3304

AFF301: Fire Phone: The Dynamic Perspective API, Under the Hood

https://developer.amazon.com/welcom

e

https://developer.amazon.com/blog

Android

Fire phoneKindle Fire

Fire TV and Fire TV Stick

BB 10

https://developer.amazon.com/welcome

https://developer.amazon.com/blog

http://bit.ly/awsevals

http://bit.ly/awsevals

Date post:	02-Jul-2015
Category:	Technology
Upload:	amazon-web-services
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(AFF201) What the Top 50 Games Do with In-App Purchasing That the Rest of Us Don't | AWS re:Invent...

Technology