2 02 Dr Charles Kriel is an Emmy-nominated game designer and free-to-play consultant. About the Author He was born in the back of a circus wagon, and grew up a carny on the American circus, where his father taught him to run games of chance. He ran away from the circus at 15, and spent most of his life as a broadcaster in the US. He eventually landed at BBC Radio 1 as Resident Artist with Ibiza for his turf. Simultaneously he served as The UN s UK National Expert in New Media. He is a Microsoft Ventures Mentor, a Wellcome Trust People Award recipient, and has awards from Ars Electronica, Arts Council England, ICA and dozens of others. His work has been featured by the BBC, The Guardian, Channel 4, the Times and Telegraph, to name a few. Charles is the Founder of 12 Stories Tall, an IP and games production company, and consultancy. In his other life, Charles regularly travels to frozen conflict zones Ukraine, Kurdistan, Kosovo and more promoting free press, consulting on data journalism, data visualization and digital privacy. He s a contributing writer at Mixmag, and has written a few Copyright Dr Charles Kriel, 2015 The moral right of the author has been asserted All rights reserved Disclaimer: Aside from Dr Richard Wilson s Introduction, the information and opinions contained in this document are not endorsed by and do not reflect the views of TIGA, and are attributable only to Dr Charles Kriel.
3 03 Introduction Thank you to Charles for allowing us to share his guide to the language of Free-to-Play with 12 Stories Tall s fellow TIGA members for their consideration. As the network for game developers and digital publishers in the UK, facilitating the sharing of expertise and experience is one of the core purposes for which TIGA exists. In our fast-moving industry, especially regarding relatively new game design and business models like Free-to-Play, discussing and developing a shared and mutually understood language is essential if we are to define and follow best practice. It is also essential if our industry is to deliver what matters above all else real value for players. Understanding how to maximise engagement in a way that enhances the gaming experience whilst also encouraging fair and sustainable revenue streams is critical to the fulfillment of free-to-play s potential. Dr Richard Wilson, CEO, TIGA
4 04 Introduction continued Welcome to the Abridged Dictionary of Free-to-Play Game Design. Free-to-play is a relatively new field, with a good deal of debate and confusion around terms. Wade through a few articles on free-to-play design, and the need for a reference becomes clear. This dictionary is a living volume for professionals in a rapidly changing field, undergoing regular change and revision. Debates over free-to-play still rage and the nomenclature is subject to constant negotiation. If you disagree with something, your opinions and contributions are important. Please your thoughts to Free-To-Play game design is both Art & Science, and can be seen as a nexus of digital marketing and mobile expertise, which is why it is such a valuable, fast-growth sector and why it is so important for UK game developers to be as good as anyone in this field. After all, given the shared terminology between mobile games and other rapidly growing tech and mobile sectors, knowing what language like ARPU and Lifetime Value means is as important to the likes of Vodafone as it is to a two person indie team. Over the years I have benefited from the insights of numerous games developers on the subject of F2P games. Yet the views expressed in this publication are mine, as are any errors or omissions. It is traditional in free-to-play books to write a page or two about why the book isn t free, excusing a $9.99 retail price while extolling the virtues of free. This book is free. Thanks for checking it out. May it lead you to epic wins. Dr Charles Kriel
5 05 About the Author Index Introduction References Definitions Achievements Ambient Awareness Analytics API Appointment Triggers ARPDAU ARPMAU ARPPU ARPU Asynchronous and Synchronous Play Average Daily Conversion Balance Bartle Types Behavioral Economics Biometric Playtesting Bite-Sized Gaming Experience Casual Gamer Churn Rate Coin Multiplier Competitive Return Trigger Conversion Rate Core Loop Cover Charge CPA Currency Daily Prizes Daily Sessions DAU Day One Retention Device Drop Out Engagement Loop Entry Event Distribution Epic Wins Event First Purchase Flow Formulas Freemium / Free-to-Play Free Spin Functional Advantage Funnel Gacha Golden Feedback Loop Grind
6 06 Definitions continued Intermittent Variable Reward K Factor Language and Region Leaderboards Lifetime Overheads Loss Aversion LTNV LTV MAU MAUU Mental Transaction Cost Minimum Viable Product Missions, Achievements and Level Near Miss New User Flow Pareto Distribution Pay-to-Win Peak Usage Peggling Pinch Points Player Delight Power-Ups Pyramid Rarity Repeated Play Properties Retention Return Triggers ROI Sessioning Session Length Social Commitment Triggers Social Proof Status Items Synchronous Play Time-on-Device Volatility Wait Loop Whale Zero-Sum Games
7 07 Achievements Achievements are symbolic trophies awarded for acquiring skills or demonstrating progress through a game. These trophies typically contribute to multithreaded player scores on networked leaderboards. Many casual games given their limited scope have a maximum possible score, but with achievements, leaderboards also display a number of badges, trophies, or other symbols, adding complexity and richness to the game experience. Achievements are designed as viral tools. They encourage other players to check out games their friends enjoy and boast over, however abstractly. Achievements standardize and systematize bragging, making it relevant to gameplay. They mark the boast as a manageable goal for another player to pursue. Challenges are another form of achievement, where a player initiates a challenge to another player by selecting one of a set of achievements they ve completed, and dares the other player to accomplish the task. Challenges are also issued by the game itself. Player-to-layer Achievements typically depend on connected play, and became ubiquitous across social games. Nearlyalways-on mobile systems with social layers ios, for example exploit achievements viral qualities. Typically operating on a fixed reward schedule, achievements can carry both functional and status value. Achievements also lend themselves to analytics, yielding insight into what players enjoy, and given the option, which part of the game a player chooses to pursue. See LEADERBOARDS
8 08 ambient awareness Ambient awareness is a type of social awareness experienced through online social networks. It is very much like being physically near someone and picking up on mood through the little things; body language, sighs, stray comments, according to New York Times journalist Clive Thompson. Often through mobile devices, which dominate social networks, users capture and produce their own media, and stay in constant ambient contact with each other according to UC Irvine professor Dr. Mimi Ito. Game executive Dallas Snell argues in Tim Fields and Brandon Cotton s Social Game Design: Monetization Methods and Mechanics that the content of the thousands of messages consumed passively on social networks is less important than the presence of the message itself, and how those messages lead to an awry awareness of one s social tribe. In this sense, the content of social streams is similar to a phatic expression one whose sole function is to perform a social task, rather than convey information. Snell argues that ambient awareness makes users happier and more secure in their social tribes by creating the circumstances for a state of homeostasis in the user one where emotions and stresses are in balance. In game design, Snell says, We design the reward mechanisms in our social gaming systems to lead them towards homeostasis by taking them through the highs of rewards and engagement, and along the way they ll be building the infrastructure around them that will be their permanent tribe, permanent friends list, filled with the people they like to play with. See LEADERBOARDS
9 09 Analytics Analytics are data patterns, read from a number of sources, informing developers about the performance of their games. Analytics sets range from simple sales data, to tracking of individual user journeys, records of users spending within the game, marketing performance both within and around the game, and a game s overall profitability. Use of game analytics has increased with online play, particularly on mobile platforms. And where analytics might historically be used to gather marketing data for premium games, they have now also become fundamental to the game design process. In free-to-play games, analytics help designers tweak game mechanics, art assets, game flow, social behaviors, and marketing-to-player features within the game. Some companies push analytics to the edge. In 2011, Ken Rudin, a Zynga vice president in charge of its data-analysis told the Wall Street Journal, We re an analytics company masquerading as a games company. And ngmoco CEO Neil Young told GamesIndustry International, [T]his is the best time to be a game designer. [Y]ou absolutely know what game design feature users are engaging in the most, and paying for the most. [T]he designers and the producers who can really effectively blend that highly iterative, deep understanding of what the users are doing with strong creative visions can lead the market. For ease of understanding, we ve divided common analytics into a number of sub-categories, although practices within the industry group them in a number of different ways: Daily DAU (pronounced like Tao ) Daily Active Users, the number of users who access the game each day. Access / Active can be as simple as starting the game and immediately quitting. The figure applies to unique players. Often preferred by the design team. Monthly MAU (pronounced like Mao ) Monthly Active Users, the number of users accessing a game each month. It is the sum of DAU over 30 days. MAU counts unique users, not plays. Usually preferred by the business team.
10 10 Analytics continued MAUU (pronounced like Mao-ooh ) Monthly Average Unique Users is based on the average across several months. Revenue per User ARPU (pronounced like R-pooh ) Average Revenue Per User is calculated for the entire game. The figure is derived by dividing the total revenue of the game by the total number of users or players. Arriving at a helpful definition of user depends on the circumstance, and leads to further acronyms, e.g. ARPPU ARPPU (pronounced like ARPA-pooh ) Average Revenue Per Paying User. This is revenue divided by players who ve made a purchase, whether premium or in-app, and is expressed across the whole of the game or a defined part (v2.0 ARPPU, for example). ARPPU is useful as a tool in designing revenue builders, vis-à-vis social triggers, across iterations. ARPDAU (pronounced like Arp-Tao ) Average Revenue Per Daily Active User. This expresses the state of a game s take for each user each day, and is useful to design teams placing spend opportunities in loops. ARPMAU (pronounced like Arp-Mao ) Average Revenue Per Monthly Active User. User LTV Lifetime Value. The lifetime value of a user is the profit that user will generate in a game from first download to churn. This figure is inclusive of Cost Per Acquisition (sometimes referred to as Cost Per Install, determining profitability. LTNV Lifetime Network Value is a combination of the profit a player will deliver from download to churn with the combined profit derived from other players they ve attracted through social networks, recommendations, reputation and display, etc. A very difficult number to calculate accurately, LTNV is nonetheless useful when understanding the importance of social graphs, and allocating marketing resources. Daily Sessions the number of play sessions a user engages each day. A session could include starting the app and checking the game s status (as in LetterPress), several attempts at an endless runner, or a couple of hours play.
11 11 Analytics continued Session Length Session Length is useful in conjunction with Daily Sessions, and is a measure of the length of a single play session. Language and Region Both the language a player speaks as well as the regional app store they use. This is an important measure when determining the degree of localization for future iterations. Device Device is not only an indicator of the physical device on which a user plays, be it an iphone, etc., but also the operating system and its version. Missions, Achievements and Level These numbers measure a player s progress through the game, both at the moment, and when they finally churn, leaving the game forever. Useful on several fronts. Peak Usage This is the time of day a user plays most. It is most useful for engineers to determine server loads for networked play, but is also useful for designers trying to understand play patterns, or who might want to incorporate temporal localizations changes of color palette based on time-of-day, for example. Acquisition CPA Cost Per Acquisition. Sometimes referred to as Cost Per Install. CPA tells marketing departments and developers the price they pay to acquire a single user, whether organically, or more likely, through advertising. If CPA remains higher than LTV for too long, a game will likely fail. Churn Rate Churn rate is the percentage of players who abandon the game forever, and is usually expressed as a monthly percentage, or the Monthly Churn Rate. Churn is often accompanied by deletion from mobile devices, making it particularly difficult to reacquire the user. Retention The opposite of Churn. The percentage of players who stick with the game. Again, often expressed monthly Day One Retention Many developers feel First Day Retention percentages, that is, the number of players who play beyond the first day, are a game s most important metric. For most games, players are unlikely to spend on the first day.
12 12 Analytics continued Conversion Rate This is the percentage of players who shift from free play to premium play, having made an in-app purchase. Conversion percentages are often expressed in single digits, or decimals. Average Daily Conversion The percentage of players who choose to spend money each day. This figure differs from Conversion Rate in that, within the narrow definition of Average Daily Conversion, a player might move from paying to non-paying and back again. Game ROI Return On Investment, a key performance indicator contrasting total revenue with total spend. KPI Key Performance Indicators. Every metric in this list and many more are KPIs which yield data indicating a game s success. Lifetime Overheads This is the cost of developing a game and keeping it alive. Servers, bandwidth, development, new iterations, etc., are all included. Marketing costs are typically reserved for CPA. Gameplay New User Flow This is the journey a user takes when they first enter the game. New User Flow can help designers tune game tutorials, introducing players to the habit of spending in-game currencies, as well as teaching them to play. It is also useful in driving First Day Retention numbers. Drop Out A player s progress at the moment they drop out of the game, or churn. This includes levels, achievements, etc. First Purchase The point at which a player first spends money. This is important in designing New User Flow, core loops, and tuning free-to-play mechanics. See FORMULAS See GOLDEN FEEDBACK LOOP
13 13 API Short for Application Programming Interface, an API lets two software systems communicate with one another. Typically published by a technology owner, APIs should ideally make it easy to implement that technology in an app or game. Analytics technologies or social mobile games platforms are particularly relevant examples for the games industry. Appointment triggers Appointment triggers are actions that yield rewards at a set time in the future. In Real Racing 3, car upgrades function as appointment triggers, taking a certain number of hours or days to complete. Players anticipate an enhanced gaming experience, knowing when they return they will have a more powerful car. See RETURN TRIGGERS See WAIT LOOP ARPDAU ARPDAU (pronounced like Arp-Tao ) Average Revenue Per Daily Active User. This expresses the state of a game s take for each user each day, and is useful to design teams placing spend opportunities in loops.
14 14 ARPMAU (pronounced like Arp-Mao ) Average Revenue Per Monthly Active User. ARPMAU ARPPU ARPPU (pronounced like ARPA-pooh ) Average Revenue Per Paying User. This is revenue divided by players who ve made a purchase, whether premium or in-app, and is expressed across the whole of the game or a defined part (Level 27 ARPPU, for example). ARPPU is useful as a tool in designing revenue builders, vis-à-vis social hooks, across iterations. ARPU ARPU (pronounced like R -pooh ) Average Revenue Per User is calculated for the entire game. Dividing the total revenue of the game by the total number of users or players yields the figure. Arriving at a helpful definition of user depends on the circumstance, and leads to further acronyms, e.g. ARPPU.
15 15 Asynchronous and synchronous play The definitions of asynchronous and synchronous gameplay are hotly debated topics. On his blog What Games Are, Tadhg Kelly cites a debate in the comments of Ian Bogost s Persuasive Games: From Aberrance to Aesthetics article to highlight the level of confusion surrounding synchrony and its opposite. For Kelly, the definition is simple: synchronous gameplay happens when players are in sync with one another in linear gametime. Asynchronous gameplay distorts gametime s linearity. For many others, asynchronous gameplay occurs when gametime overlays not-gametime chess by mail, for example, where gameplay extends across weeks, overlaying an extended period of real life. Kelly would nonetheless call this synchrony, as it is synchronously turn-based one player cannot take their turn until a turn is taken by the other. Games like the mobile hit Real Racing 3, which features timeshifted multiplayer technology, reveal the level of confusion surrounding the issue. This kind of tech lets players, in the instance of racing games, compete against other players previously completed races, but in a format making those races appear in sync with the current race. Samit Sarkar, in an article on Polygon, describes playing in time-shifted multiplayer mode as competing with a ghost run uploaded by another player you play against an ethereal vehicle driving along the exact route that person took, and attempt to finish with a better time. In this instance, however, the ghost is corporeal, colliding with your vehicle, impacting your race. Since Real Racing 3, as well as games based on the more traditional Mail Chess model like Words With Friends and LetterPress, asynchronous has come to refer to any game that stretches gametime across non-gametime, and is frequently used as asynchronous turn-based. Synchronous usually refers to games played in real-time. Either way, linear turn-based play, stretched across notgametime, functions as a powerful return trigger and viral mechanic. Kelly s terms possess greater intellectual rigour, but are unfortunately trumped by common usage. See RETURN TRIGGERS
16 16 Average daily conversion Average Daily Conversion The percentage of players who choose to spend money each day. This figure differs from Conversion Rate in that, within the narrow definition of Average Daily Conversion, a player might move from paying to nonpaying and back again. Balance Balance in free-to-play game design is achieved when players feel they can progress logically through a game in a fun way without experiencing exploitation, yet the game is still rigorously monetized, creating reward for the designers and developers. Good game balance improves game flow, and retains and monetizes players. Over-monetized games will repel players and damage a studio s brand, and so are not in the long term best interests of players, developers, or the industry. As such, Game Balancer has become a new but relatively common job description within the games industry.
17 17 Bartle types Bartle types are categories of so-called player psychology based on a 1996 paper, Hearts, Clubs, Diamonds, Spades: Players Who Suit MUDs, by Richard Bartle, a British games writer. In Bartle s bowdlerized version of the psychology of game players, he divides them into four camps Killers, Achievers, Socializers and Explorers, assigning each a card suit, based on their behavior: clubs, diamonds, hearts, and spades, respectively. According to Bartle s vision, Achievers fetishize points and score, privileging status rewards. The play behavior of Explorers (dubbed Spades for their tendency to dig around) orients around discovery and detail. Socializers are driven by social play, as their name indicates, with the game acting as a bridge between players. Killers are highly competitive, and prefer player vs. player transactions. In psychological theory and practice, typology was left on the shelf some decades ago. Bartle s types simplify player psychology, and as such are mostly usable as retrospectively causal descriptions of player journeys originating in design mechanics.
18 18 Behavioral economics Behavioral economics is a theory stating that there are important psychological and behavioral variables involved in the economic decisions of consumers. Behavioral economists are interested in the same topics that interest economists: why people buy, how they make decisions, the right mechanisms in markets, etc. However, where economists operate from a rationalist s perspective, psychologists know that people act irrationally and that emotional experiences often override cognition. Emotions often control decisions, engagement and experiences we feel more than we think. Behavioral economics also suggests that we all have a number of cognitive bias s that influence our behavior and further influence our irrational choices. Biometric playtesting is a form of user experience evaluation that measures the relationship between in-game events and a player s feelings and emotions, using biometric feedback. Biometric playtesting Free-to-play games have placed developers under extreme financial pressure from a number of sources. Players often do not want to pay to download games, and investors are skittish about games, viewing hits as one-offs. This forces developers to release minimum viable products and use the profits from these first iteration releases for further development. Developers are using biometric playtesting as one of the most effective means of tweaking free-to-play game mechanics for first iteration profitability. Studios with rumoured in-house biometric playtesting facilities include Valve Software and Electronic Arts. See MINIMUM VIABLE PRODUCT
19 19 Bite-sized gaming experience Bite-sized gaming experiences are key components of casual games featuring easy pause and restart mechanics. In Social Game Design, former OMGPOP Studio Head Everett Lee uses the metaphor of stop-and-go traffic, calling games built around bite-sized experiences traffic stop games. They are easily put down and picked up again, consistently delivering satisfactory gaming experiences in a few seconds. Game designers aiming to create bite-sized experiences pay particular attention to the ease of exit and re-entry within a game. Once broadly dismissed by the games industry, casual gamers were players who neither read the games industry press, nor followed release dates or game charts. More recently, they are characterized as gamers who don t read game blogs or reviews outside the App Store, and would be unlikely to refer to themselves as gamers. Casual gamer However, casual gamers are also where the new audience lies, particularly in free-to-play games, and the games industry now pays a great deal more attention. Most Facebook gamers are casual, although the rise of use of the Unity game engine for Facebook games may well change this. Most mobile users play casual games, although again, Unity may impact that as well. See BITE-SIZED GAMING EXPERIENCE See ACHIEVEMENTS
20 20 Churn rate Churn rate is the percentage of players who abandon the game forever, and is usually expressed as a monthly percentage, or the Monthly Churn Rate. Churn is often accompanied by app deletion from mobile devices, making it particularly difficult to reacquire the user. Coin multipliers lie at the core of a format popularized by Bally in the 1960s, although it was first introduced in In this format, players can spend several coins per turn, with each coin multiplying potential payback. Coin multiplier Natasha Dow Schüll points out that this innovation can increase a player s time-on-device, increasing time within a flow state, raising each player s gaming productivity, as well as the engagement effect of the game s mechanics. With each play, a player could spend as many as five coins. Coin multipliers paved the way for multiple win opportunities, where players can win in hundreds of ways with each turn. See REPEATED PLAY PROPERTIES See FLOW See TIME-ON-DEVICE Competitive return trigger Retention mechanics based around competition with other players. Leaderboards and achievements are the most common examples. See RETURN TRIGGERS
21 21 Conversion rate This is the percentage of players who shift from free play to premium play, having made an in-app purchase. Conversion percentages are often single digits. Core loop Core loops are the most important components of free-to-play games. A core loop is an action / result mechanic, most often configured as action reward, and is a term used across the whole of game design. In the context of free-to-play, and particularly in grind mechanics, the action to reward loop is often augmented by a power-up or upgrade. Players complete a level, receive coins, and use the coins to acquire upgrades with a functional advantage more powerful weapons, faster cars, etc. See FUNCTIONAL ADVANTAGE See GRIND See POWER-UPS See WAIT LOOP
22 22 Cover charge The cover charge was an interim financial model in free-toplay monetization mechanics. Users could download games free, but they were required to spend a small amount of money before they were able to play. In exchange for this charge, players were usually rewarded for their investment with a certain amount of in-game currency. Developers felt this guaranteed revenue. This model rarely succeeds in contemporary free-to-play games. See CURRENCY CPA Cost Per Acquisition. Often referred to as Cost Per Install. CPA tells marketing departments and developers the price they pay to acquire a single user, whether organically, or more likely, through advertising. If CPA remains higher than LTV for too long, a game will fail financially. See LTV
23 23 Currency in games refers to in-game or virtual currencies mediums of exchange through which players acquire powerups, upgrades, unlocks and virtual goods with either functional or status value. Currency Nearly all sophisticated free-to-play games that is, games that go beyond simple pay-to-unlock mechanics maintain in-game or virtual economies. In-game currency is acquired through both core loop mechanics and through purchases with real money. Whilst a virtual currency can create a more immersive fictional game world, it is essential that developers, and more to the point platform owners, are transparent about any fees players are given the option of paying, and make it clear what the amount is, of real world currency they are spending. These considerations, and others, are part of the OFTs principles for online and app-based games, which are legally binding and thus essential reading for all free to play games makers, and for the good of players and industry alike. The principles can be viewed here. See MENTAL TRANSACTION COST See POWER-UPS
24 24 Daily prizes Daily prizes are rewards offered to players at the first session of play in a single day. They are return triggers, designed to increase retention. Other examples include mystery boxes, lottery tickets, free spins, etc. See FREE SPIN See RETURN TRIGGERS Daily sessions Daily Sessions the number of play sessions a user engages in each day. A session could include starting the app and checking the game s status (as in LetterPress), several attempts at an endless runner, or several hours play. DAU (pronounced like Tao ) Daily Active Users, the number of users who access the game each day. Access / Active can be as simple as starting the game and quitting immediately. The figure applies to unique players. Often preferred by the design team. DAU
25 25 Day one retention Day One Retention Many developers feel First Day Retention percentages, that is, the number of players who play beyond the first day, are a game s most important metric. For most games, players are unlikely to spend on the first day. Device Device Device is not only an indicator of the physical device on which a user plays, be it an iphone, etc., but also the operating system and its version. Drop Out a player s progress at the moment they drop out of the game, or churn. This includes levels, achievements, etc. Drop out
26 26 ENGAGEMENT LOOP An engagement loop is the mechanic that keeps a player interested in the game, and is interchangeable with core loop, as a term. See CORE LOOP Entry event distribution Entry events are key for social and mobile free-to-play games. An entry event is the first thing a player does when they enter the game. Blogger Matt Fairchild points out that players who have received a gift via a social network are most likely to check out the gift first when they return to the game. By tracking the distribution of these events across the player base, developers can determine the best mechanics for retention. Epic wins Epic wins are rewards that are simultaneously improbable, rewarding and achieved via an ambiguously defined route. This fuzzy definition, combined with the large potential windfall, makes epic wins attractive events for gamers, despite their improbability. See INTERMITTENT VARIABLE REWARD
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