There are many conversations, articles and even books on how to optimize in-application purchases (IAP) in social games but most neglect the most important element. Rather than focusing on adding friction, tweaking price levels, running sales, etc., there is one aspect that does not get enough attention and can make all the difference between success and failure.
Insufficient content
It sounds simple, but the biggest constraint on monetization, and a game’s success overall, is not creating enough content. Most social games lauch with enough content for what the developers believe will be anywhere between four and twelve weeks of gameplay, thus giving them enough cushion to create new content before it is consumed.
The problem is that the high-value players, those few players who account for the bulk of the purchases (referred to by some companies as “whales”) will actually play threw the game in a matter of weeks. This is not simply a problem with smaller developers who have limited resources, but even the biggest social game companies (the Zyngas, Playdoms and Woogas of the world) routinely underestimate how quickly users will play through all the content in a game.
The effect
Although it is obvious that if players play through the game and have no more content left it will hurt monetization but strength of the effect is underestimated. First is the obvious foregone revenue that the company is not earning because the player has nothing left to buy. Second, as these players are the most avid fans of the game, they are the ones that drive monetization. If they run out of opportunities to monetize, other users do not make up the slack. Third, the first players in a game are usually the most valuable (often generated 50+ of the lifetime revenue for a game). If they are frustrated because there is no more content, they will go on to other games (and with so many great social games on the market that is an easy decision) and never come back. You will thus be losing most of the customer cohort that has the highest lifetime value. Do not expect these players to come back when there is new content if they have been frustrated for more than a matter of hours (yes, everyone has a short attention span these days).
Why?
Given how widespread this issue is, the obvious question is why does it continue to happen. First, companies do not know how successful their games will be. Unlike films where you have tracking projections or TV shows that have layers of focus tests, testing for social games from large companies is usually limited to an internal beta at the game company where the users are not indicative of the general public. Smaller companies do not even have this luxury, so they will often use the initial results to predict a game’s performance.
Given the hit driven nature of social gaming, nobody knows if their next release is the next Cityville or the next Deep Realms. Thus, it is difficult to commit resources to elder gameplay (content after players have completed the initial phase) when you may know in weeks that the game is not worth additional investment.
Second, developers always underestimate the amount of time everything takes. Thus, the team may feel it can create content in a matter of days post release while in reality it takes weeks or even months to get out new content. Moreover, the first few weeks (and sometimes months) after release, even of a high quality game, usually end up being consumed with bug fixes and optimization. Since getting the game stable has to be priority number one, resources originally intended to new content are often used for maintenance.
Third, and I think most significant, is that even though this situation is repeated again and again, developers underestimate how much content the heavy users will consume. I have seen even the most experienced social game professionals, people who have published multiple top-10 hits, make this mistake repeatedly. Logically, they cannot fathom how much content avid players will use. The fact is, though, that heavy users for a social game are no different than a person who goes to fifty Phish concerts a year or reads every Tom Clancy (or Clancy labeled) book the day it comes out. They are outliers, but outliers you need to plan for.
The solution, or not
As much as I would love to provide a pithy solution on how to avoid this situation, there is no easy answer. You may not want to create a ton of extra content pre-launch as there is a good chance the game may fail (depending on your experience, probably anywhere from 40-90 percent chance of failure) and the extra content will just add to your loss. You also may have time commitments, what publisher does not need to get games out in certain windows to keep stakeholders (shareholders, investors, friends and family, etc) happy.
What I suggest is you ensure you have the capacity to pour gasoline on the fire if you have a hit. This can be through keeping people on the game, using external developers and artists, having central content resources that can be directed to your successful launches or some combination. You should also develop a roadmap exploring and listing the ways you would add content with contingencies for the different results your Business Intelligence team derives from the initial data (i.e. if players are stopping because they need more levels, then be ready to add more levels, but if players are not playing through but consuming all the limited edition (LE) goods, then get some more LE items out there). Even though you cannot have a clear roadmap without the data, you need to think through the various contingencies and then where the capacity will come from to support each course of action.
