How to Turn a Profit from Microtransactions

Credit cards and their usage in mobile technology is an ever-evolving topic, which has revolutionized and shaped how users consume content. This is part 4 of a 12-part series discussing credit cards’ evolution in regards to their mobile usage and customer base, how people around the globe are utilizing them, and where they are going in the future. 

Microtransactions and how to make these little purchases add up.

Microtransactions and how to make these little purchases add up.

We’ve already discussed the advantages of in-game purchases truly being in-game to increase conversion rates and keep users engaged. Credit cards factor into this when they are linked up to a user’s account or third party payment system. With an active credit card on file and an effort to keep users in-game while they make purchases, let’s take a look at how you can profit from microtransactions.

According to Venture Beat, “Microtransactions from free-to-play games accounted for 79% of all revenue on the iOS and Google Play app markets in the U.S. in January” of 2014. The market shares for free-to-play content purchases has seen a steady increase over the last two years. Around the world, and especially in countries such as Japan, Korea, the UK, the US, and Australia, free-to-play is still on the rise. 94% of gaming revenue in China and Japan come from microtransactions.

So how do you do it? How do you turn these relatively small content purchases into a sizable profit for your company? To make a profit from micro transactions, you need to start with the foundation of a good game: offering content that is meaningful and that players will want to pay for.

Little charges from lots of customers can trump larger charges up front!

Little charges from lots of customers can trump larger charges up front!

Don’ts

-Change your gameplay mechanic to include in-app purchases later

If a game has already been released without in-game purchases, adding them in at a later date could anger your existing players and upset the balance of your gameplay. Adding purchasable content later could mess up the leveling of an existing game or it could sour players’ feelings about the game, if they believe the developers just want to milk a buck or two out of them.

-Sell power ups that ensure a higher score

Within games where high score is the ultimate goal, selling power ups that boost one player’s score above the other who may have more gameplay talent is a surefire way to make your user base angry. It messes up the core gameplay mechanic behind the game: talent should trump purchases in competitive high-score games.

-Overprice your content

If you’re adding more content and a large range of added levels, you can charge a higher price point. However, if your in-game purchases don’t help the player significantly, or are simply cosmetic, or are small amounts of unlocked time, adjust your pricing model accordingly. It is better overall to match the content to the right price and sell more amounts of little micro transactions than a handful of larger ones.

Do: energy charges work for paying and non-paying customers alike.

Do: energy charges work for paying and non-paying customers alike.

Do’s

-Start integrating micro transactions from the first day of game design

If you approach planning your game with the understanding that in-game purchases will be an integral part of your product, you’re already a step ahead. Make sure you understand how micro transactions will play into your game: will you charge for time refills? Purely cosmetic? These two examples require different end goals of a game. The first may revolve around time management and the latter may be a game focused on social elements and simulation games where appearance shows rank or standing.

-Allow your game to be enjoyed without microtransactions

Paying customers only make up a small percentage of active game players within the free to play market. This means you need to make your game enjoyable for those who aren’t paying, too. Boosts for speeding up in-game processes are a good option for in-game transactions because players who want to experience the game can still play, it just may take them longer. Players who do not wish to wait don’t have to. And there, you’re turning a profit! Keeping non-playing players participating in your game is a good thing, as they may turn to paying players one day.

-Know where your game content fits on the spectrum

If your game idea isn’t a social or time-based management game, don’t fret. There are still options for you to get it out there and get it seen! If you go through these steps and still know your game may not work well with said micro transactions, think about giving away a level or two free. Later, if the player wishes to continue, you can offer in-game unlock purchases per level or even the whole game. And when it comes time to decide about purchasing the game, make sure to route players to use their credit cards for instant purchase, which will ensure no distractions or time for second thoughts.

Credit Cards and Tying it Together

And credit cards are the catalyst that will put these strong developer choices into action. By designing your game with these pillars listed above, you need only to offer the one-click system by allowing users to file a credit card as a payment option. There will be no hassle for players as they stay in-game, make their purchase, and continue enjoying your game, knowing they paid for the content they want and deserve.

Tagged , , , , , , , , , , ,

2 thoughts on “How to Turn a Profit from Microtransactions

  1. Jacquie says:

    Hey there! Do you use Twitter? I’d like to follow you if that would be ok.
    I’m undoubtedly enjoying your blog and look forward to new updates.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s