the monetization battle continues
Yeah, 2009 is a great year for trying to make money off of Flash games. Instead of being able to buy a venti iced cappucino (and a muffin!), you’re reduced to whatever grocery store swill your 85 cents per day can buy. Yep, ad revenue is in the toilet. GameJacket recently went bankrupt, not only leaving developers in a lurch, but making games which used their technology unplayable. (Server-side game storage doesn’t sound so hot now, does it?). Some people have noted that they were one of the only sites to guarantee 0.50 CPM’s, which probably contributed to their downfall.
So, now everyone wants to get into the microtransaction game. The obvious problem has been that Flash games by nature percolate from site to site, often making single-portal monetization solutions unattractive (sorry Whirled!). There are some exceptions, but in general the really good games are intended to get their millions of plays across a number of high-traffic sites. Thus what we need is a way for players to have some sort of shared currency, stored in some secure central location, that is available to them when playing a number of games across any portal which they happen to be hosted on.
Finally, some companies are stepping up to the plate. First is Mochi, with their predictably named MochiCoins service, still in private beta, but with at least one game floating around various portals. Not to be outdone, the Flash Game License crew has come up with their own system, GamerSafe, which combines microtransactions with server-side save games and achievements. There is also HeyZap, Andrograde, and a number of other solutions.
I think for any solution to gain traction, there needs to be a few key factors:
- First-mover advantage - The service which gets the first “hit” game, with microtransactions smartly implemented, will have a huge advantage.
- High-quality games — Users want to know that their transactions will be useful, bug-free, and for quality game content.
- The psychology of “free” — Users are used to free products. so if the games seem like “demos”, that will be a big turn-off. Instead, the transactions should feel like paying for icing on the cake, useful features that enhance their experience and are priced at a reasonable (i.e. cheap) cost.
- Stickiness/replayability — What’s the point of paying for premium features in a game that you’ll only play once for 5 minutes? Games that use this feature need to have depth and replayability. Ideally, the premium features should enhance long-term playability: fun, status among peers, UI advantages, etc.
- Variety of payment options — Paypal is great, but what if the user doesn’t have a credit card? (Other options like SMS transactions would be smart…)
- Security - At the very least, phishing of an in-game account should only let the thief access the stored credits. If there is a “gamer coins” to “real money” transaction path, there will inevitably be trouble, since Flash games can easily be decompiled/cloned/hacked to grab user login information.