Dienstag, 1. Mai 2018

Game Monetization: Cosmetic items

As last part of the game monetization and criticism series we look at the influence of "cosmetic items"

Cosmetic items are digital items that have no influence on game play - just in a usually very limited way on the optics of the character / the player's representation within a game: From costumes to animations to decoration, lodgings, pets, furniture, colors, accessories and so on. Since these items do not enhance a player's performance within a game, they're often marketed as "benign" ways to get more funding for a game. Activision Blizzard's Overwatch is a prime example of the success of these cosmetic items.

Freitag, 20. April 2018

Game Monetization: Loot Box controversies

In 2016 Blizzard's game Overwatch was very successful with their loot box monetization strategy. Player could earn loot boxes in game (or more quickly purchase them with money) that contained cosmetic items to enhance the visuals of their in-game avatar.
Loot boxes can contain anything digital - from powerful boosters to extra in game currency or fun items. While a randomized looting system is nothing new to games, paying extra to get more loot boxes became increasingly popular over the last years and changed game mechanics to accommodate the use of loot boxes.

Embed from Getty Images

 Loot boxes have been around since about 2007, they swamped the blockbuster/mainstream game market in 2017, leading to criticism and scrutiny. There are two main reasons for this criticism:

Donnerstag, 12. April 2018

Game Monetization: Overview

To name the price of a game nowadays can be downright confusing: Big publishers offer their games in a big variety of packages - from only a key to special editions that involve digital and real items. This is not different from special editions of movies. But games have gone far beyond that.

For a big part this is because the industry itself has changed. Some games just aren't finished after their release. They might promise long term engagement with new content continuously delivered. They might need to adapt to new technology or need a support team / servers running. Those games depend on continued purchases.

From ridiculous ways to deter people from buying used games (including a code in the physical game that can be used only once to unlock the whole game) to smart ways to keep a game running, here is an overview of how people pay for games nowadays:

Buying the game

A lot of games arrive on the market as finished product. The customer pays a full price or after a while a discounted price and can play the game. Sometimes patches are delivered later, if technical issues arise. Some games come in a plethora of different versions - from special versions from certain retailers to real life objects like artbooks, soundtrack, statues and so on - works of artistry to display at home.These are usually more expensive than just the regular game.

Kickstarter / Alpha- / Betagames

Some games rely on crowd funding. The customer purchases the promise of the game and depending on how much the customer spends / which tier the customer chooses, the game can be included in any form - from no game (just a thank you to support the production), to the finished game, to special boxes.
A few games like minecraft and Factorio open up early versions of the game for purchase. Directly advertised as unfinished games that are still heavily tested and might not even work in some versions. The customer pays for access to the test versions usually with the promise of not having to pay for the game again (which will be more expensive once fully released).
For the customers, this carries the risk of never holding a finished game, if the developers cannot keep up or the game cannot be finished in the form promised. The developers have the advantage of being financially supported while working on the game. This works well with first-time projects or creative visions that might not appeal to a mass market. Good word-of-mouth, a good reputation and often some social media skills (as well as luck) are essential to make this work.

"Free" games

Many publishers chose a free (or... "freemium") approach to their game. Either one can play a significant part of the game for free and has to buy the later acts / full access or has a big array of advantages by paying for perks within the game. To offer a game for free means a low barrier of entry: Especially with games that need a lot of active players (of which just a very small percentage actually buys optional additions), the publishers are interested in keeping the game world populated, so that the few paying players don't leave.
There is a golden line that rewards ACTIVE players as much as PAYING players (groups that definitely also overlap). Browser games often use this model, where a lot of playtime will get you to the same point as somebody who spends money on the game.

To turn a profit, these are popular methods to monetize a free game:

In-App-Purchases

In-App-Purchases let the player pay with an ingame currency or real money for things like:
  • Lootboxes - Mystery Boxes that could contain anything beneficial for the player. In another article we'll shine a light on this method, which has been come under fire in early 2018
  • Boosters - Boosters go several ways. In essence they let the player progress faster, by: - eliminating timing restrictions, enhancing success chances, offering a kind of insurance (for instance if rolling dice is part of the game, one gains extra dice rolls) 
  • Socketing +  Enchantment-systems: putting additional virtual power into digital items that will enhance the player's avatar power
  • Vanity Items - Items that do not affect the game play but let the player customize their ingame avatars (be it an actual character, vehicle or building)
  • Resources - from additional inventory space to replenishing an empty mine - resources that are either integral part of the game and have to be bought or resources that go into booster territory: could be gained over longer playtime, but faster progression with buying them
There are companies that don't make games but are specialized in monetization. More research has to be done to really figure out what makes people buy digital goods. But some of the psychological tricks include: first of all a digital currency, that is difficult to translate into real money. Next: A low entry price point, a big reward for the first purchase, timed and limited items as well as certain sales. A careful mix of these techniques not only increases revenue, some big games use sales to almost train their players: A big event comes up that needs the players online constantly? Why not offer some powerful potions ingame that will make the player's character very strong for that big event? If the players invest money, it's likely they will be much more involved in the event and giving other players a sense of competition and being part of something big - something, that is worth investing in... 


Season pass, subscription

Some games - free as well as premium games, still ask for a fee to play the game. This is useful for games that have high running costs or are in need of continuous content updates (like World of Warcraft, which has to offer its players not just a lot of content, stable servers and service, but also content possibly as soon as the most active players have seen all of it.)

Sponsorships or advertising

Some games "annoy" the players with advertising in hopes that the player will pay to turn the advertising off by paying a one time fee.
In some cases brands that wish to address the target audience of a successful game might pay to be represented within the game.
Sometimes its the other way around: Sportsgames might not feel real to their players, if the presence of real-life advertising in sports is not reflected within the game.

Merchandise 

If a game is very beloved and/or the game developer managed to create a powerful licence, Merchandise can be an additional strong revenue stream, because players wish to show off their love for the game outside of it as well.

All in all, it depends heavily on the game itself, which payment methods will feel native. Some games are successful as free games with just very few people paying for boosters. Other games just cannot be made for the regular purchasing price of (in the US) 60 Dollars for a full price game and need to find additional revenue streams, to keep this price. Creating blockbuster games is as expensive as blockbuster movies, but the psychological margin of 60 dollars as full price seems to not have shifted over the past 10 years.


Sources:

https://indiewatch.net/2017/11/26/top-5-mobile-game-monetization-models-for-2018/ (Nov 2017) (aufgerufen 3.4.2018)
https://electronics.howstuffworks.com/free-to-play-games-make-money.htm (2015) (aufgerufen 3.4.2018)
https://venturebeat.com/2015/10/05/an-insiders-take-on-monetizing-free-to-play-games/ (2015) (aufgerufen 3.4.2018)
https://en.wikipedia.org/wiki/Microtransaction (aufgerufen 3.4.2018)
https://en.wikipedia.org/wiki/Software_as_a_service (aufgerufen 4.4.2018)
http://www.pocketgamer.biz/monetizer/59307/18-top-f2p-monetisation-tips-to-supercharge-your-business/ (aufgerufen 4.4.2018)
https://www.digitalriver.com/flexible-monetization/ (aufgerufen 9.4.2018)
https://www.researchgate.net/publication/290578398_Sport_Video_Game_Sponsorships_and_In-Game_Advertising /aufgerufen am 9.4.2018)

Montag, 2. April 2018

Course Material Social Media Communication March 2018

Source: Socialbakers.com
For the upcoming course about social media we will need some case studies to apply our learnings to real-world examples. On the left, you will find a list of the top performing global brands on Instagram in the first three quarters of 2017. Below is a list of recently successful social media campaigns:

Have a look at TrueFruits: What are they doing right? Why is it working?

Here is a list of successful German corporate blogs. How are they able to engage their users? How do they translate their brand into social media content? How do they integrate other social media platforms like Facebook and Instagram?

If you are particularly interessted in Instagram, look up Westwing to see how Instagram can be interegrated into an eCommerce strategy which must lead all users to its website and how its content clearly zooms in to its female client-base. Have a look at Founders Brewing, Chameleon Cold Brew or Eating Evolved to learn about how Instagram Stories, user-generated-content and hashtags are being used. If you prefer the look from the influencer's point-of-view, Horizon.net highlights successful influencers every month (here is the current list from February 2018) and the most successful Influencer marketing posts (here the list from February 2018)

Naturally, YouTube is a central social media channel with its own "rules of success." What do you think, why were these YouTube spots so successful early this year? And why do you think so many people enjoyed watching or rather hearing Alexa losing her voice (Hint: what is the essence of storytelling and what is comedy)?

We will also look into social media guidelines. Here is the link to an earlier blog-article with many examples to delve into and analyse.

Dienstag, 6. Februar 2018

Behavioural Micro-Targeting - Studie und Ressourcen

Die aktuell sehr viel diskutierte Studie von Matz et. al. (2017) haben wir bereits im Social-Media Seminar und auf dem Blog behandelt. Nun fasst auch ein journalistischer Artikel die Studie und die generelle Diskussion zu psychologisch-informiertem Micro-Targeting zusammen. Der Artikel im Spektrum ist sehr zugänglich geschrieben und bietet viele weiterführende Links unter anderem zu der für das psychologische Profiling genutzten Datenbank (mypersonality) mit über sieben Millionen Einträgen, die es erlauben OCEAN-Profile mit bestimmtem Facebook-Likes in Verbindung zu bringen und die man zum Beispiel auch im Rahmen einer Bachelorarbeit nutzen könnte.

Das iScience-Institut der Universität Konstanz bietet einen validierten, deutschsprachigen Test zur Einordnung von Nutzern in die Big Five Persönlichkeitsprofile an, in dem man anonym seine eigene OCEAN-Profilierung ausprobieren kann. Das Institut erlaubt auch den Einsatz des Tests in externen Forschungsarbeiten (Details finden sich hier), was für die ein oder andere Bachelor- oder Masterarbeit sehr interessant sein könnte.

Freitag, 8. Dezember 2017

Interaction and Persuasive Design - Introductory Lecture

As Marschall McLuhan pointed out "we become what we behold. We shape our tools, and thereafter, our tools shape us." Not least because of this link, a basic understanding of interaction design has become essential in our current society. But also interaction design has been shown to be a central if not the critical success factor for most digital artefacts and digitally based value chains in general.

The introductory lecture, supported by the prezi-slides below or here as a link, aims to give a general overview to interaction design and its underlying design process. The slides start with an attempt to define the rather broad discipline of Interaction Design and describe its overall context, move on to the process in which it is embedded and then continue with a number of 'laws' and principles of interaction design, which intend to inform its development process.

In its second part, the lecture delves into basic concepts of persuasive design - with  particular thanks to Johannes Rahe, who has agreed to contribute parts of the literature summary of his bachelor thesis.

Donnerstag, 7. Dezember 2017

An Introduction to the Ambidextrous Enterprise

The digital transformation requires companies to both continue to excel in their current business and explore new avenues. These two activities, also referred to as exploitation and exploration, are fundamentally different. They require often fully opposite managerial skills and other structural and cultural environments. How can companies, which have successful running business models, find the energy and skill-set to disrupt themselves before others do it? This is the question which we will delve into in our new Mindset-Workshop on "The Ambidextrous Enterprise." Below you find the course material as a clickable prezi or here as a link to the presentation.