GSummit SF 2014 - Engagement and Monetization by Top-Earning Mobile Applications by Peter Heinrich...

Engagement & Monetization

by Top-Earning Mobile Applications

GSummit 2014, San Francisco

Z e r o

E n t e r t a i n m e n t

PETER HEINRICHDeveloper Evangelist, Games

@PeterDotGames PeterHeinrich

[email protected]

Amazon does games?

— Many People

Engagement Reports

PC / Mac Downloads

Indie Storefront

Android App Distribution

Kindle Fire

AWS

In-App Purchasing

Direct to Account

Mobile Ads

Amazon CoinsAchievements

Leaderboards

A/B/n Testing

Whispersync for Games

Login with Amazon

Amazon Device Messaging

Cross Platform

Amazon GameCircle

Android App Distribution

WHAT MOVES THE

NEEDLE?

IAP ADOPTION IS ON THE RISE

No Surprise to Anyone

Projected Total IAP Revenue

Source: Gartner, September 2013

2011 2012 2013 2014 2015 2016 2017

What are the top-grossing

developers doing

differently?

COHORT ANALYSISDifficult to Compare Apps Directly

• Based on Behavioral Analytics

• Shared experience

• Usually limited to a specific time period

• Related individuals form "cohorts"

Examples: People who had measles at age 9

Tall pilots who flew for United in March

Customers who purchased within

one week of download

COHORT ANALYSISTop Earners vs. Everyone Else

Looking at customers who installed

a Freemium game on March 1, 2014,

Split into to two populations (cohorts):

Cohort 1: Top 50

Game was one of the Top 50

Highest-Grossing titles

Cohort 2: The RestGame was NOT one of the Top

50 Highest-Grossing titles

INSTALLED VS. ACTIVE, FIRST 30 DAYS

Normalized as a Percentage across the Appstore

Source: Amazon Appstore, March 2014

100

Installed

Active

Time

INSTALLED VS. ACTIVE, FIRST 30 DAYS

Top 50 Highest Grossing


100

Installed

Active

Time

SESSION COUNT & LENGTH

Time In-Game

6.9

7.417.9

21.52.6

2.9

# of sessions / active

session total / active(minutes)

× =

avg. session length(minutes)

Day 0

Top 50

The RestSource: Amazon Appstore, March 2014


6.7

7.721.4

27.03.2

3.5



× =


Day 1

Top 50

The Rest


Time In-Game

5.9

7.9

15.3

25.32.6

3.2



× =


Day 3

Top 50

The Rest


Time In-Game


5.7

7.4

14.8

23.72.6

3.2



× =


Day 7

Top 50

The Rest


Time In-Game


5.7

7.3

14.3

22.62.5

3.1



× =


Day 14

Top 50

The Rest


Time In-Game


5.9

7.3

14.2

22.62.4

3.1



× =


Day 30

Top 50

The Rest


Time In-Game


SALES & REVENUE

In-App Purchases

Day 0

112%

136%152%

100% 100% 100%

# of items / paying avg. selling price ARPPU

=×

Top 50

The Rest


Day 1

106% 107% 113%100% 100% 100%


=×

SALES & REVENUE

In-App Purchases


Top 50

The Rest

Day 3

107%122%

131%

100% 100% 100%


=×

SALES & REVENUE

In-App Purchases


Top 50

The Rest

Day 7

102%

121% 123%

100% 100% 100%


=×

SALES & REVENUE

In-App Purchases


Top 50

The Rest

Day 14

111% 108%120%

100% 100% 100%


=×

SALES & REVENUE

In-App Purchases


Top 50

The Rest

Day 30

103%

128% 132%

100% 100% 100%


=×

SALES & REVENUE

In-App Purchases


Top 50

The Rest

Does item quality alone

account for the difference in

average IAP transaction

amount?

ASSORTMENT BY PRICE POINT

Total Marketplace


31%29%

7%

12% 11%

5%3%

1%

14%

11%

6%

3%

16% 16%

11%9%

0%

5%

10%

15%

20%

25%

30%

35%

$0.99 $1.99 $2.99 $4.99 $9.99 $19.99 $49.99 $99.99

% of Assortment % of Sales

ASSORTMENT BY PRICE POINT

Top 50 Only

28%

15%

10%

13%11%

9% 9%

5%

32%

19%

7%

4%

10%12%

5% 4%

0%

5%

10%

15%

20%

25%

30%

35%

$0.99 $1.99 $2.99 $4.99 $9.99 $19.99 $49.99 $99.99

% of Assortment % of Sales


OTHER OBSERVATIONS

0 24 48 72 96 120 144 168 192 216 240 264 288 312

EARLY ENGAGEMENT IS CRITICAL

In-App Purchasing by Hour


Hours since download

TIMING = MORE MONEY

Time = Money, but


Engage customers early 37

%

of a customer’s value is

realized on the first day

Keep them in the game 48

%

of repeat purchases happen

within one hour of a previous

purchase

Give them a reason to come

back64%

of revenue comes

from 3rd order +

74%

of revenue occurs

after the first 7 days

56%

of revenue occurs

after the first 30 days

69%

100%

145%

0%

20%

40%

60%

80%

100%

120%

140%

160%

1-5 Items 6-10 Items 11-15 Items

SELECTION DRIVES REPEAT ORDERS

More Is Better


# of In-App Items for Sale

ARPPU

INDEX: Average = 100% 1.14%

of customers generate

30% of sales

80%

90%

100%

110%

120%

130%

140%

150%

160%

170%

1 4 7 10 13 16 19 22 25 28

PRICE SENSITIVITY DECLINES

As Price Increases over Time

Source: Amazon Appstore, July 2013

Days Owned

+60%

average

selling price

MANY PRICE POINTS MAY BE

CONFUSING

Offer Price Variety, but Not Too Much


Conversion Rate

INDEX: Average = 100%

147%

101%

52%

0%

50%

100%

150%

200%

1-5 6-10 11-15

Price Points

BEST PRACTICES

WITH A TUTORIAL EXPLAINING

HOW TO PURCHASE ITEMS

Teach players to buy

The best tutorials show features and benefits of

each items so the customer can gauge value,

boosting conversion by up to 150%.

THE ITEMS CUSTOMERS HAVE

PURCHASED, IF APPROPRIATE

Explain how to redeem

Good post-purchase tutorials can have a

dramatic impact on repeat sales. The best ones

we saw showed 65% more repeat purchases.

WITH A TABULAR INTERFACE TO

ALLOW SHOPPING BY FEATURE

Make a simple store

Use tabs and tiles to allow users to shop by item

type, function, and price. Catalogs following this

format raised ARPPU 75% over the store

average.

TO BALANCE PRICES AND PRICE

POINTS, KEEP IT FRESH

Tune your catalog

Offer high-value items for your best customers,

but don't confuse the price list. Add new items to

expand catalog and renew interest.

ENGAGEMENT

MULTIPLIERS

OBSERVATIONS

Recap

1. IAP is accepted and will only grow

2. More time in game = more revenue

3. Players will pay for higher-priced items

4. Balanced catalogs monetize better

5. Repeat customers are critical

6. Selection drives repeat purchases

BEST PRACTICES

Recap

1. Make engagement your #1 priority

2. Show players how to purchase IAP items

3. Show how to redeem items after purchase

4. Create a simple, visually appealing store

5. Tune your catalog

Engagement & Monetization

by Top-Earning Mobile Applications

GSummit 2014, San Francisco

Connect on Facebook:https://www.facebook.com/groups/Amazonstudentgamedev/

Follow me: @PeterDotGames

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