A friend recently mentioned how he met with a game company who told him they were doing great but not focused on monetization yet. This should be a red flag if you hear this at your company or a company you are thinking of working with.
What it means not to be concerned about monetization
If there was a Google translate for game development, when you type in the phrase we are not focused on monetization yet, the output would be “want don’t want to admit to ourselves or to you that our game does not work and is a failure.”
When you hear these words, you need to look at the game closely. Ask the question how will it monetize in the future? What value(s) is the player getting out of the game? Would the player still play if the game was not free? Are there alternatives for the player if you started to monetize?
Depending on the answers to these questions, you can then understand your situation. If the player is not getting value from the game, you need to change the game so they feel it is something they cannot live without. If the player has alternatives, you need to make your product special so that the alternatives are no longer alternatives. The bottom line is that if you are giving your player a value they cannot get anywhere else, they will pay for it.
Monetization is only one element of lifetime value
There is one situation where the answer that a company is not focused on monetization is appropriate, if they feel they can generate more value from focusing on retention or virality. The only measurement that matters is your customer lifetime value (LTV), how much your customer is worth to the company over their lifetime. LTV is a function of monetization, retention and virality. There are often situations where you can impact LTV more by focusing on retention (usually) or virality (see WhatsApp). In these situations, it is not only legitimate but preferred that you are not focused on monetization.
The reality
When you hear a company is not focused on monetization, however, it is often because they do not know how to monetize their game or product or it does not provide real value to users. Then it comes down to whether you are actually providing value to your user and, if not, either how you can or what you want to do next with your career.
Key takeaways
- When a company or person says they are not concerned about monetization, what they really mean is that they cannot monetize their users.
- The one exception is when a company is trying to increase its LTV by focusing on improving retention or virality rather than monetization.
- If the problem is an ability to get users to spend money, you must then figure out if you are providing real value to the user and if not you need to change your product so you do.
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