Eric Suffert acutely describes the dangers of extending payback windows. At every t+1 the accuracy of LTV declines while the variance in cohort profitability increases. LTV, however, is not an exogenous variable and clever design can incentivize players into revealing their long-run time horizons within a game. Consider the design of a many subscriptions: you…
The ASA has banned misleading ads from Playrix’s Gardenscapes. Running the same creative in user acquisition hits diminishing returns fairly quickly as the creative “clears the market” for users attracted to that creative. To broaden appeal, why not simply advertise the game as existing in a entirely different genre? This opens up a whole new…
There’s a compelling aspect to achieving group oriented goals: being apart of something larger than yourself. Lots of F2P developers harp on the importance of social features. Yet the social experience in many games is abysmal. Lots of teammates or clanmates don’t seem interested in participating instead preferring to “free-ride”, putting forward little effort but…
The supply-side economics of subscriptions are fairly straightforward: get massive scale and distribute costs. Netflix has over 160M subscribers meaning a $100M production only costs each user $0.63. There’s zero marginal cost (unlike Spotify), so the more subscribers Netflix has the less a piece of content costs on a per user basis. At $11 per…
Amazon has announced Luna, yet another stab at game streaming and subscriptions. It seems like the failures of Apple Arcade, Stadia, Gamefly, and our oft-forgotten OnLive have not been effective deterrents. Not to be outdone, Rovio’s Hatch continues to drain money every quarter. Perhaps this is what Bezos warned shareholders about when discussing new “multibillion-dollar…
Apple is increasingly under fire what’s claimed to be unfair practices in the App Store. The criticism takes three forms: (a) Apple’s 30% fee is much too high relative to cost (b) the rules are arbitrary and stifle competition and (c) the App Store as the exclusive avenue to install apps on iOS is unjust.…
“We want to be more data driven” or “We want to create a stronger data culture” are common organizational refrains. Supposedly, having more data or data playing a larger role in the decision making process is profitable. It’s weird because I haven’t seen any research to suggest this is the case. In firms like Facebook,…
Performance based marketing makes intuitive sense; of course you want to optimize ROI on spend that compose 30% or more of a your firm’s expenditures. But here’s the kicker: if it makes sense for firms why not individuals? Shouldn’t we be tracking the impact of our output? Are co-workers actually reading your analysis, concept art…
Bloomberg is reporting that Epic is seeking to raise $500M to $1B in new funding. Tim Sweeney, Epic CEO and provocateur extraordinaire, owns 60% while Tencent owns the other 40%. Why would Epic need more funding as it continues to rake in Fortnite money? Tim has bigger ambitions, let’s figure out what they are. As…