How Freemium Developers Get You To Pay

Free, microtransaction-driven games are here to stay.

It seems like every multiplayer title on the computer or phone these days is using the free-to-play (freemium) model. While the genre is still in its infancy, most developers tend to adhere to a few specific design styles that emphasize the old gambling adage of “separating a sucker from his money.” The best defense against being tricked is knowing the tricks yourself, and I’ve got the lowdown on all the ways developers aim to part you from your money.

This knowledge is not an inoculation against the temptation of freemium games. Rather, it will allow you to make an educated decision as to whether you really want to give a developer your money. By knowing all the tricks, you can figure out whether or not you want to fall for them. It’s entirely possible that you will do so quite often! I’ve shelled out far more than I care to admit for some freemium games.

Before we get started with the different design styles, you need to understand the basics of the freemium model. Developers who produce freemium games measure their users by a few metrics: average revenue per user (ARPU), lifetime value (LTV) and churn. ARPU is simply the total revenue of a title divided by how many people play it. LTV is how much a player puts into the game while their account is active. Churn is how often players – especially players that have paid – leave the game.

Think of it like an ocean where the players are fish and the developers are fishermen. The fishermen want many fish (ARPU) that are nice and plump (LTV). However, if the fish are constantly escaping the nets and warning other fish off (churn), the fishermen can go out of business. Developers want maximum ARPU and LTV while maintaining minimal churn. They want you to stay addicted and pay without being forced away through frustration or anger.

The players who do this – keep playing and keep paying – are called “whales” (a term from gambling circles).  Their LTV is off the charts, and the often spend hundreds or even thousands of dollars on decking out their accounts with all the cool stuff they can. Whales are the current focus of freemium design, and developers aim to convert as many players into whales as possible. A small percentage of whales can contribute immensely to a game’s revenue, and the continual conversion of subscription-based titles to the freemium model – with accompanying revenue boost – is proof of just how much players are willing to pay.

So now that you know what freemium developers want from you, it’s time to tell you how they take it.

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4 Comments on How Freemium Developers Get You To Pay

Rjcb

On March 5, 2013 at 10:53 am

Very Informative. Glad I read this article, thank you kind sir!

Axetwin

On March 5, 2013 at 1:00 pm

Very good article, this is one of the few times I dont feel like something else should be added.

What really pisses me off about the withholding features scheme isnt that companies do it, its that many players defend it. Most notably, players that have almost exclusively played p2p MMO’s and have little to no experience with f2p ones. These are the guys that are quickest to say “out of the 100 things to do in this game, you can do these 15 for free so you have novocaine right to complain.”

R.J.

On March 5, 2013 at 1:35 pm

A very useful article. It’s fine if people decide that they want to pay for something, it is their money after all, but it is far better that they do so as a well informed consumer rather than simply whistling the tune of companies that are in it for profit. It’s not necessarily a bad thing for companies to look for various methods to generate revenue, but the customer certainly should know what is being done so that they can make their own decisions on whether those methods are acceptable to them.

Kevin

On March 5, 2013 at 4:58 pm

A comparison to the house always winning in casinos is a pretty apt one. People who play F2P games are ultimately marks. Are you a good or a bad mark? And most importantly, even though you are a mark, can you still have an entertaining time with the game?