What's Working in In-App Monetization - GDC 2014

53
Mike Hines Amazon Appstore Game Developers Conference - 2014 @MikeFHines

description

In this session we'll share data and tips that Amazon has gathered from the top 50 revenue-generating apps that use IAP. Then we'll look at some innovative mobile ad ideas and explore the re-discovered future of in-app monetization...e-commerce.

Transcript of What's Working in In-App Monetization - GDC 2014

Page 1: What's Working in In-App Monetization - GDC 2014

Mike Hines – Amazon Appstore

Game Developers Conference - 2014

@MikeFHines

Page 2: What's Working in In-App Monetization - GDC 2014

Top 50 Grossing

vs.

the Rest of Freemium

Page 3: What's Working in In-App Monetization - GDC 2014

IAP Conversion Rate

INDEX: Average = 100%

IAP Adoption is Rising

Note: Conversion Rate is measured by the Number of IAP Customers / Total App Customers

Source: Amazon Appstore, July 2013

Page 4: What's Working in In-App Monetization - GDC 2014

Cohort Analysis

Group A: Top-50 Grossing

Source: Amazon Appstore, June 2013

Group B: Rest of Freemium

Page 5: What's Working in In-App Monetization - GDC 2014

Day 0: Installs

Group A: Top-50 Grossing

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Source: Amazon Appstore, June 2013

Group B: Rest of Freemium

iiiiiiiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiii 100 100

installed

Page 6: What's Working in In-App Monetization - GDC 2014

Day 0: Active Users

Group A: Top-50 Grossing

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Source: Amazon Appstore, June 2013

Group B: Rest of Freemium

iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiii iiiiiiiiiiii 12 13

installed

88 87

active

Page 7: What's Working in In-App Monetization - GDC 2014

Day 0: Uninstalls

Group A: Top-50 Grossing

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iiiiiiiiiii iiiiiiiiiiiiii

Source: Amazon Appstore, June 2013

Group B: Rest of Freemium

iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiii iiiiiiiiiiiiiiii 16 14

uninstalled

84 86

active

Page 8: What's Working in In-App Monetization - GDC 2014

Day 0: Paying Users

Group A: Top-50 Grossing

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iiiiiiiiiiiiii

Source: Amazon Appstore, June 2013

Group B: Rest of Freemium

ii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiii 16 14

uninstalled

82 84

active

2 2

paying

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Day 0: Engagement

Group A: Top-50 Grossing

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iiiiiiiiiiiiii

Source: Amazon Appstore, June 2013

Group B: Rest of Freemium

ii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiii 16 14

uninstalled

82 84

active

2 2

paying

# of sessions / active

session length / active (minutes)

× =

avg. session length (minutes)

7.4

7

2.3

2.9

14.4

20

Page 10: What's Working in In-App Monetization - GDC 2014

Day 0: Revenue

Group A: Top-50 Grossing

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iiiiiiiiiiiiii

Source: Amazon Appstore, June 2013

Group B: Rest of Freemium

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= × # of items / paying

100%

109%

avg. selling price

100%

141%

100%

154%

ARPPU

16 14

uninstalled

82 84

active

2 2

paying

# of sessions / active

session length / active (minutes)

× =

avg. session length (minutes)

Page 11: What's Working in In-App Monetization - GDC 2014

1 Day Later…

Group A: Top-50 Grossing

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iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiii

Source: Amazon Appstore, June 2013

Group B: Rest of Freemium

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# of sessions / active

session length / active (minutes)

× =

avg. session length (minutes)

18 16

uninstalled

45 43

active

1 1

paying

36 40

installed

= × # of items / paying

100%

112%

avg. selling price

100%

152%

100%

170%

ARPPU

Page 12: What's Working in In-App Monetization - GDC 2014

3 Days Later…

Group A: Top-50 Grossing

iiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii

iiiiii iiiiiiiiiiiiiiiii

Source: Amazon Appstore, June 2013

Group B: Rest of Freemium

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# of sessions / active

session length / active (minutes)

× =

avg. session length (minutes)

20 18

uninstalled

27 26

active

53 56

installed

= × # of items / paying

100%

107%

avg. selling price

100%

180%

100%

193%

ARPPU

Page 13: What's Working in In-App Monetization - GDC 2014

1 Week Later…

Group A: Top-50 Grossing

iiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii

iiiiiiii iiiiiiiiiiiiiiiiiiiiii

Source: Amazon Appstore, June 2013

Group B: Rest of Freemium

iiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiii iiiiiiiiiiiiiiiiiiiiiiii

# of sessions / active

session length / active (minutes)

× =

avg. session length (minutes)

24 22

uninstalled

20 20

active

56 58

installed

= × # of items / paying

100%

112%

avg. selling price

100%

233%

100%

262%

ARPPU

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2 Weeks Later…

Group A: Top-50 Grossing

iiiiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii

iiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiii

Source: Amazon Appstore, June 2013

Group B: Rest of Freemium

iiiiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiii

# of sessions / active

session length / active (minutes)

× =

avg. session length (minutes)

28 25

uninstalled

14 14

active

58 61

installed

= × # of items / paying

100%

114%

avg. selling price

100%

198%

100%

226%

ARPPU

Page 15: What's Working in In-App Monetization - GDC 2014

1 Month Later…

Group A: Top-50 Grossing

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iiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiii

Source: Amazon Appstore, June 2013

Group B: Rest of Freemium

iiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii

# of sessions / active

session length / active (minutes)

× =

avg. session length (minutes)

32 29

uninstalled

9 9

active

59 62

installed

= × # of items / paying

100%

116%

avg. selling price

100%

189%

100%

219%

ARPPU

Page 16: What's Working in In-App Monetization - GDC 2014

100%

154%

ARPPU

session length / active (minutes)

= × # of items / paying

100%

109%

Group B: Rest of Freemium

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Day 0

Group A: Top-50 Grossing

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iiiiiiiiiiiiii

Source: Amazon Appstore, June 2013

16 14

uninstalled

82 84

active

2 2

paying

× =

avg. session length (minutes)

# of sessions / active

avg. selling price

100%

141%

Page 17: What's Working in In-App Monetization - GDC 2014

session length / active (minutes)

100%

170%

ARPPU

= × # of items / paying

100%

112%

Group B: Rest of Freemium

i iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiiiii

1 Day Later…

Group A: Top-50 Grossing

i iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii

iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiii

Source: Amazon Appstore, June 2013

× =

avg. session length (minutes)

18 16

uninstalled

45 43

active

1 1

paying

36 40

installed

# of sessions / active

avg. selling price

100%

152%

Page 18: What's Working in In-App Monetization - GDC 2014

session length / active (minutes)

100%

193%

ARPPU

= × # of items / paying

100%

107%

Group B: Rest of Freemium

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3 Days Later…

Group A: Top-50 Grossing

iiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii

iiiiii iiiiiiiiiiiiiiiii

Source: Amazon Appstore, June 2013

× =

avg. session length (minutes)

20 18

uninstalled

27 26

active

53 56

installed

# of sessions / active

avg. selling price

100%

180%

Page 19: What's Working in In-App Monetization - GDC 2014

Group B: Rest of Freemium

iiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiii iiiiiiiiiiiiiiiiiiiiiiii

session length / active (minutes)

100%

262%

ARPPU

= × # of items / paying

100%

112%

1 Week Later…

Group A: Top-50 Grossing

iiiiiiiiiiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii

iiiiiiii iiiiiiiiiiiiiiiiiiiiii

Source: Amazon Appstore, June 2013

× =

avg. session length (minutes)

24 22

uninstalled

20 20

active

56 58

installed

# of sessions / active

avg. selling price

100%

233%

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= × # of items / paying

100%

114%

Group B: Rest of Freemium

iiiiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiii

2 Weeks Later…

Group A: Top-50 Grossing

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iiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiii

Source: Amazon Appstore, June 2013

× =

avg. session length (minutes)

28 25

uninstalled

14 14

active

session length / active (minutes)

58 61

installed

100%

226%

ARPPU

# of sessions / active

avg. selling price

100%

198%

Page 21: What's Working in In-App Monetization - GDC 2014

= × # of items / PU

100%

116%

Group B: Rest of Freemium

iiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii

1 Month Later…

Group A: Top-50 Grossing

iiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii

iiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiii

Source: Amazon Appstore, June 2013

× =

avg. session length (minutes)

32 29

uninstalled

9 9

active

session length / active (minutes)

59 62

installed

100%

219%

ARPPU

# of sessions / active

avg. selling price

100%

189%

Page 22: What's Working in In-App Monetization - GDC 2014
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1

Hours Since App Download

0

24 48

72

96

120

144

168

192

216

240

264

288

312

In-app Purchasing by Hour

Source: Amazon Appstore, July 2013

Page 24: What's Working in In-App Monetization - GDC 2014

Timing = More Money

Engage customers early 18% of a customer’s value is

realized on the first day

Keep them in the game 44% of repeat purchases happen

within one hour of a previous

purchase

Give them a reason to come back 56%

of purchases are

repeat purchases

62%

of revenue occurs

after the first 7 days

35%

of revenue occurs

after the first 30 days

Source: Amazon Appstore, July 2013

Page 25: What's Working in In-App Monetization - GDC 2014

# of In-App Items for Sale

ARPPU

46%

100%

169%

0%

20%

40%

60%

80%

100%

120%

140%

160%

180%

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

INDEX: Average = 100%

Selection Drives Repeat Orders

Source: Amazon Appstore, January 2013

2%

of customers generate

30% of sales

Page 26: What's Working in In-App Monetization - GDC 2014

Image from Pet Shop Story by Team Lava

Source: Amazon Appstore, January 2013

Awareness Increases Conversion

2.5x

conversion

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Make it Easy to Shop

Image from Diner Dash by PlayFirst

Source: Amazon Appstore, January 2013

+75%

ARPPU

Page 28: What's Working in In-App Monetization - GDC 2014

Show Users How to “Consume”

Image from Cut the Rope by ZeptoLab

Source: Amazon Appstore, January 2013

+65%

repeat orders

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Conversion Rate

INDEX: Average = 100%

83%

188%

63%

0%

50%

100%

150%

200%

1-5 PricePoints

6-10 PricePoints

11-15 PricePoints

Offer Variety, but not Too Much

Source: Amazon Appstore, January 2013

Page 30: What's Working in In-App Monetization - GDC 2014

Concentration on Low Prices

Total Marketplace: Assortment by Price Point

22%

17%

7%

20%

8% 6%

3% 2%

6%

9%

4%

15% 15%

20%

4% 5%

0%

5%

10%

15%

20%

25%

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

% of Assortment % of Sales

Source: Amazon Appstore, January 2013

Page 31: What's Working in In-App Monetization - GDC 2014

Top Games are more Balanced

4%

9%

5%

14% 14% 12%

10% 9%

1%

5%

2%

11%

16%

24%

6%

9%

0%

5%

10%

15%

20%

25%

30%

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

% of Assortment % of Sales

Source: Amazon Appstore, January 2013

Top 50 Apps: Assortment by Price Point

Page 32: What's Working in In-App Monetization - GDC 2014

Price Increases Over Time

Days User Owned App

80%

90%

100%

110%

120%

130%

140%

150%

160%

170%

1 4 7 10 13 16 19 22 25 28

Source: Amazon Appstore, July 2013

+60%

average

selling price

Page 33: What's Working in In-App Monetization - GDC 2014

Sensitivity Across Prices

-30%

-20%

-10%

0%

10%

20%

30% + 28%

- 28%

+ 1%

- 1%

Low-Priced Items High-Priced Items

% Change in Unit Sales Volume

20% Price

Changes

Source: Amazon Appstore, January 2013

Page 34: What's Working in In-App Monetization - GDC 2014

What is the Take-Away?

Session-Length and Session-Frequency Optimize your IAP

Page 35: What's Working in In-App Monetization - GDC 2014

What Can I Do to Improve Session Time?

• Reduce Barriers to frequent use • Tune Game Difficulty • Adopt Social • Special Events

Page 36: What's Working in In-App Monetization - GDC 2014

Reduce Barriers to frequent use

Page 37: What's Working in In-App Monetization - GDC 2014

Tune Game Difficulty

Page 38: What's Working in In-App Monetization - GDC 2014

Adopt Social

Page 39: What's Working in In-App Monetization - GDC 2014

Special Events

• Special levels • Time-Bound • Unique item rewards

Page 40: What's Working in In-App Monetization - GDC 2014

What Can I Do to Optimize IAP?

• Design purchase opportunities into the fabric of your game • Be clear about the benefit • Be clear about the value offered • Start selling physical goods

• A|B Test your offers

Page 41: What's Working in In-App Monetization - GDC 2014

Design purchase opportunities into the fabric of your game

Page 42: What's Working in In-App Monetization - GDC 2014

Be clear about the benefit

Page 43: What's Working in In-App Monetization - GDC 2014

Be clear about the value offered

Page 44: What's Working in In-App Monetization - GDC 2014

Start selling physical goods

VentureBeat, Feb 2014

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A|B Test your offers

Page 46: What's Working in In-App Monetization - GDC 2014

In-App Advertising

Trends and Tuning

Page 47: What's Working in In-App Monetization - GDC 2014

Banner Ads for Which Products Get the Most Engagement?

Harvard Business Review, 12/2013

These get more clicks… …than these do.

Page 48: What's Working in In-App Monetization - GDC 2014

Buying and Selling Trends

Ad revenue outside the US will grow faster than inside the US. Asia will be particularly hot. More companies are buying mobile ads… …paying for quality of clicks, not quantity. •Cost per Engagement (CPE) is trending.

•So….

Samaato, Gartner, The Guardian – 2013 & 2014

Page 49: What's Working in In-App Monetization - GDC 2014

… Reward users for engaging with ads!

Offer soft currency rewards • For taping into an ad • For watching a video ad

Page 50: What's Working in In-App Monetization - GDC 2014

Buying and Selling Trends

Inmobi, 2013 - Bloomberg Businessweek, 2014

Page 51: What's Working in In-App Monetization - GDC 2014

Not All Ads are Banner Ads

You finished Level 5!

Pick your reward!

Page 52: What's Working in In-App Monetization - GDC 2014

What Can You Do?

Integrate ads into your game where

possible

Offer incentives to engage with ads

A|B Test revenue vs. engagement • Video ads

• Presence of interstitial ads

• Placement of ads

• Order of ad networks

Page 53: What's Working in In-App Monetization - GDC 2014

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