The experts' guide to mobile games monetisation: Part two

• Highlights: “Mobile is split into F2P which relies on IAPs and ads and Premium which requires an upfront fee F2P dominates with a 99% market share”
• “Ensuring that you have a variety of push notification types including rewards is definitely a way to get users to re-engage and one that is underutilised”

Finding the right monetisation strategy for a mobile game may be challenging, but it's also a necessity. With a market full of well-established games and more being released all the time, these games likely seek to monetise the same audiences. Therefore, having a solid strategy can be the difference between success and failure.

In this second and final part, John Wright, Kwalee’s VP of mobile publishing, provides deeper insights into player types, regional differences, and the role of live ops and events in monetisation. This knowledge can empower you to make informed decisions about your game's monetisation strategy.

And don't miss part one here.

Personas and country specifics 

What exactly are player personas? For me, they're the definition of a particular type of player or a bucket of users that are categorised under said “persona” which a studio can then optimise a particular strategy towards.

The basic form is perhaps a group of high-value spenders referred to as “whales,” which for years was what everyone spoke about. Pre hypercasual, there was a strategy of finding and growing the number of whales you had in your game. Effectively, those top 1% of players were how many games were successful, and without them, many games died.

So let’s break this down a bit.

Firstly, you had your most valuable users - which were 'payers' - who would respond to in-app purchases. These could be categorised as “minnows”, “dolphins”, and “whales”. Studios had other categories including “killer whales”, “orca’s”. (I even heard of “salmon” once).

The categorisation is really dependent on the studio, but let’s say that lifetime spend would go as follows.

Minnows - $1 - $10

Dolphins - $11 - $20

Whales - $20+

On top of the 'payers', you have some equally basic categories, which are 'event players', 'offer takers' and 'non-payers'.

These personas, like in our 'payers' example, also have sub-types. They, however, are completely defined by the data you have gathered over multiple game launches. If you’re a new studio, however, I think the four I mentioned above are the best to start with.

Once you’ve defined your player types, you should optimise your in-game strategy to maximise each one, equally trying to convert less valuable personas into more valuable ones, such as moving 'non-payers' to 'payers', for example.

How to convert a player

There are two main options for doing this: One, you can develop your own back-office solution that defines and categorises said users, then serve them different in-game experiences to try and maximise user potential, or you can simply pay for a third-party solution. If I were a new studio, I would probably do the latter while establishing my own system over time.

Where things get more interesting, however, is looking at country specifics. What do I mean by this? Well, as we know, players in T1 countries are more valuable to studios because they have more disposable income to spend on things like IAPs.

In T3 countries, payers are more scarce. So what do we do here? Just focus on T1 and forget the billions of potential players in these markets? No. We simply change our strategy depending on the market.

So, in T1, we would focus more on increasing our percentage of paying players, where the experience would be optimised towards balancing IAPs, subscriptions, providing discounts and offers and then rewarded video as the combination of IAP and RV we know is a successful one.

Then, for T3, we would more than likely “squeeze the lemon.” This would involve adding additional ways to make money from non-payers. This is notably interstitial and optimising ad frequency. RV, and perhaps an offer wall, depending on the genre of your game. (See part one for more details on these monetisation options.)

Again, this has to be thoroughly tested over multiple months to find the most optimal setup for not only your user personas but also for each country tier (and, eventually, each country).

Live ops and events

What's the best way to make more money as a studio when launching new games has never been more difficult? Live ops, and limited-timed events linked to a particular occasion, calendar or one-off special are definitely something that you need to focus on.

Let’s start with the basics.

What should you really be focusing on as part of live operations? Events are definitely a big part of it, but let’s save that for the end.

• Content updates

Just because you’ve launched your game doesn’t mean your work is done. It’s important to continue to provide content updates and changes to improve the game’s performance over time. We do not build games to be flashes in the pan; we build games that we want to have around for years to come. Reviewing your FTUE, adding more characters, levels, new features, and metagame, all of these should be factored into your product roadmap and be worked on from sprint to sprint.

• Community management

Something that I see more and more in casual games comes from years of success in mid-core, strategy and, ultimately, PCC games (PC console games). This is the importance of establishing a community in your games, as well as outside them.

Adding moderator-supported guilds and communication in-game can definitely help your goals of keeping players interested and engaged over time. Setting up a Discord server and providing a safe place for players to discuss the game and make meaningful contributions is growing ever more important.

• Personalisation

The importance of personalising each user's journey based on their player type is part and parcel of live ops.

• Limited-time IAPs and subscriptions

This can be executed in a few ways. The most basic would be discounted IAPs to payers who haven’t purchased something within a fixed period of time. Equally, there could be limited-timed IAPs or subs that allow you to have unique or limited-time items/characters/vanity items.

Finally, you could expand this further by organising an integration event with an IP holder and creating a transmedia strategy! Barbie in Stumble Guys is a great example.

• Push notifications and re-engagement

Ensuring that you have a variety of push notification types, including rewards, is definitely a way to get users to re-engage, and one that is underutilised, in my professional opinion.

Re-engaging users is a surefire way to improve LTV if the user has churned. Effectively the LTV is at 100% at that point. If you do manage to claw them back and even get them to watch a single interstitial ad, this will increase that LTV by the revenue attributed to that ad.

• Events

Lastly, events are the most simple and easy to implement. Stick to the basics. Sit down and have an ideation session with your team. Write down all the usual cultural events like Christmas, Thanksgiving, NYE, LNY, etc. Then pepper in unique events that are linked to your studio or games (like a first anniversary). Then, you can think about more complex ones like crossovers and IP integrations.

In Summary

What I would have hoped over these two parts is that I would have covered enough bases for developers starting their own studios to learn about what it takes to implement F2P monetisation into their games.

I also hope that I’ve given some individuals who have been in the space for a while something to think about. We normally talk about “monetisation” as if it’s all to do with the mediations we use or the networks that generate the ads for us.

In fact, monetisation, and especially the economy of games, are much more important, provided that they're implemented correctly.

Monetisation isn’t easy; it’s f*cking hard, and vast. There are so many different levers to pull to make this work, and if you pull the wrong ones, your game will never find profitability and it will never scale.

Apart from the pure development of your games, nothing is more important than this.

Summary of the most important points

1. Types of monetisation: Mobile is split into F2P, which relies on IAPs and ads, and Premium, which requires an upfront fee. F2P dominates with a 99% market share. 

2. Rewarded videos: The most common ad unit you’ll find in games offers users incentives to watch ads. Placement is crucial to engage players effectively and make sure that the balance of the reward is correct. A/B test it frequently.

3. Interstitial ads: System-initiated ads appear at specific points, varying by game genre. Developers control the ad frequency to optimise revenue without disrupting gameplay. This is a way to “squeeze” the lemon from those players who sit in the “non-payers” persona.

4. Banner ads and offer walls: Banner ads are static images usually at the bottom of the screen, usually in games with low IAP monetisation. Offer walls reward users for completing actions in other games, generating revenue through “cost per engagement” campaigns and usually have good eCPMs.

5. IAPs: The most desired yet challenging monetisation method, aiming to get 4 to 6% of users to make purchases using real money in game. Success relies on a well-balanced game economy and tapping into the right player motivations. 

6. Subscriptions and cross-promotion: Subscriptions provide recurring revenue (MRR or ARR) through exclusive content and perks. Cross-promotion within a developer's game portfolio can increase lifetime value by retaining users in their own ecosystem rather than losing them to competitors. 

7. Game economy and player motivation: Balancing difficulty and progression is key to encouraging spending by driving the right player motivations. Metagame elements like mini-games and leaderboards enhance longer-term engagement and retention. 

8. Player personas and country strategies: Identifying user types (e.g. minnows, dolphins, whales) helps personalise monetisation strategies. Different approaches are needed for Tier 1 and Tier 3 countries to optimise revenue from varied user bases.

9. Live ops: Essential for long-term success and creating 'evergreen' games, this includes regular content updates, community management, personalisation, limited-time IAPs, and effective push notifications to re-engage users. 

10. Events: Hosting cultural, studio-linked, or IP integration events boost engagement and offer unique revenue generation opportunities. Planning and implementing various events can keep players interested and spending for longer.

While I didn’t cover everything, and I intentionally didn’t dive deeply into AdMonetisation integration, mediation networks, the networks that drive it, or topics such as hybrid waterfalls or bidders - since I’ve discussed those extensively in the past - I hope the content provided was more valuable and insightful than the usual discussions about monetisation.

                                                                                           Edited by Paige Cook