Video Game Monetization: How to plan, design, and navigate around pitfalls
Everybody wants to make a living from the things they love most, and I am pretty sure the audience of this website loves video games – just like I do. There numerous resources on how to actually develop a game, but the one thing that is not thought explicitly is how to make money from the great game you made. Developers, especially indie developers and small crews usually are stumped when it comes to monetizing their games. The purpose of this post is to explain different monetization systems, and break down how to approach monetization in games.
Money may or may not be evil, but making money from your efforts is definitely not
Before getting started with the details, we need to discuss and dispel the prejudice against money and monetization in video games. All of us have encountered games that prioritize money making above actual gameplay and try to make the game addictive for the sake of milking their “customers” (any Diablo Immortal players here?). However just because there are companies like that does not mean that all monetization is inherently evil. You are putting in time and effort into this game, and you deserve to get something in return. Maybe you are lucky and do not need monetary returns, or can afford to think more strategically to make a name for yourself with your first game. Unless you are among those lucky few, you should think about monetizing your game and be considerate to players when planning a revenue stream – there is nothing wrong about that.
Good news is, if you are adamant on NOT putting in any monetization at all in your game, there are still other options like having a Patreon or asking for donations. At the end of the day, you should think about it this way: if you are not worried about finances, you can and will afford to make more and better games. Don’t let the worst examples in the industry prevent you from making games and bringing fun to people’s lives.
The Spectrum of Monetization: Upfront Payments to Free-to-Play
Monetization in games is a spectrum: on the one end we have Upfront Payments and on the other, Free-to-Play. Every game that is monetized out there falls somewhere on this spectrum. At the extremes, both are quite straightforward to grasp.
- Upfront payments require you to pay in some for before accessing the game.
- Free-to-play games are… free to play – requires no commitment or payment to experience the game.
How does a F2P game make money though? There are two main categories of monetizing a F2P game:
- Cosmetics: things the player can purchase that are purely aesthetic changes to a component of the game
- Paywalls: Making a part of the game either impossible or very difficult to access unless you spend money
Cosmetics are quite easy to design conceptually, they do not impact the game balance, and players can choose to not engage with them unless they want to. This autonomy in purchase decision makes them much more attractive to players.
Paywalls on the other hand are quite difficult to design well – the player’s desire for experiencing the game must be balanced with the annoyance or frustration of having to pay for it. In most cases they are part of the game design, if not a core mechanic in the game. Think the Energy systems in a lot of mobile games – you need to wait for it to recharge to be able to play the game or pay to skip that waiting time. The message to the player is simple: you can not have the full experience unless you pay.
Cosmetics
– Easy to Design
– Does not impact game balance
– Player has autonomy in purchase decision
Paywalls
– Difficult to design
– Intertwined with game design
– Players are coerced into purchasing
There are many examples of games that use either or both of these successfully. The aforementioned Leage of Legends goes with the pure Cosmetics approach and create incredible works of art that players are more than happy to spend money on. On the other hand, Candy Crush limits how much you can play the game unless you purchase lives but the session length is optimized so most people do not feel like they have to purchase lives – 5 or 10 minutes at a time is more than enough.
There is a very deadly trap that a lot of games fall into when designing paywalls, and it is referred to as “pay-to-win” aspects. It is when a player who purchases something gains a distinct advantage over another player who does not. No matter the size or tenure of the company, everybody is susceptible to fall into this trap (looking at you again, Diablo Immortal). It is a mistake that causes games and sometimes companies to fail; and to be honest it is totally fair if they do.
Pro-tip: Pay-to-win is ok as long as there is no player-vs-player (PvP) aspect in your game. If you have a solo game and you sell a “sword of one-shotting bosses” that makes the game trivial, it is up to the player to purchase it. The only thing that might be hurt is your feelings when people skip over hours of content you spent a ton of effort building. Otherwise, it is completely ok from a monetization perspective.
How to design Monetization? Two steps to success
When you are thinking about the monetization, you need to choose what the main monetization method is going to be. Pick a place in the spectrum above, going from upfront payments to completely free-to-play and design it as if there will be no other way to make money from the game. Be especially careful if you choose to go with paywalls as mentioned above!
Second step is deciding how many other monetization systems there will be. It is fine to have multiple but for the health of the game (and your sanity) try not to go overboard. Three to four monetization systems maximum are more than enough for even AAA games to make money and not feel predatory (wow, a third Diablo Immortal callout). Just make sure you stick with one as the main method to keep things simple.
Quick tips & tricks:
- Think about monetization during game design. A lot of junior game developers and designers do not pay attention to how they will monetize the game, and spend months on development before slapping a small price tag and putting it on their platform of choice. That rarely works, and even if the game is amazing it will not be enough to cover the costs of development for that or future games. Come up with a plan to make revenue from your game as you are designing the game; especially if you are toying around with paywalls.
- Greed Kills. To expand a bit, greed kills small companies and developers moreso than big names in the industry. It is better to undervalue your game, especially if you are new, than to overvalue and lose players for this and future games due to the perception you are greedy with monetization. If you have even an inkling that this game or feature is not worth the price tag, lower it.
Conclusion
I hope you got a good understanding about monetization in games through this post. For those who would want to solidify this information and get more comfortable thinking about monetization, see whether you can identify where your favourite games are in the monetization spectrum. Plot twist; they likely have more than one but as we mentioned – that is ok.
p.s. I do not know how I managed to write an entire post on video game monetization without a reference to “Gatcha” games. I am as surprised as you are.