As I’ve already discussed, I am quite happy with the Free-to-Play game concept – where you can create an account, download and play a game for free, but you can buy extra stuff via in-game purchases. The best free-to-play games give unrestricted access to all features, with the upgrades being mostly cosmetic or for convenience. But this week I want to look, not at the concept itself, but at how developers should be handling these so-called micro-transactions and how much they should be charging for these extra services.
Free to Play
Free-to-play games are becoming increasingly popular and successful. The case study that proves that the concept works is Lord of the Rings Online, but most MMOs, including Blizzard’s ailing World of Warcraft, are now following suit. It’s a great idea that can have benefits for developers and gamers. It’s a great way of getting players into a gaming community (and into a position to give the developers money) and it gives players a chance to see if they actually like a game before having to pay any money for it!
But with Age of Empires Online shutting down recently and the obscene prices that Marvel are charging for extras in their new Heroes MMO, I thought I’d take a look at how it should be done.
Micro-transactions: Cheaper = More Money?
It comes down to one of those concepts that doesn’t seem to make sense at first, an element of ‘Game Theory’, where sometimes selling your product cheaper will earn you more money. Its counter-intuitive, I’ll grant you, but it soon starts to make sense if you think about it.
If you sell something in your game for £6, some players (because there will always be people who have more money than sense) will be willing to shell out for it and you make some lovely money. Sorted. Or not… At £6, lots of people will think “ooh, that’s a bit steep, I’m not buying that” and only a small percentage of players will actually end up buying it. If, instead, you charge £2 for the same thing, more people are likely to be willing to pay the money and if three times as many people buy it at the lower price (which is likely), you will make the same amount of money. More importantly, if MORE than three times as many people buy it (also quite possible), you actually make more money!
Obviously you have to play the odds and there may be some overheads to consider. A new weapon or car upgrade might need new graphics, meaning you have to pay an artist and so on, but something like a bank slot upgrade or an experience point booster (if the game is properly designed and built) should cost the developers next-to-nothing. It is tempting to think “the money we get for this service is pure profit”, which would be true, but the temptation to charge more money to make more pure profit might actually not be as straight forward as it first seems.
Age of Empires
Let us return to the example of the, now defunct, Age of Empires Online. It let you access most of its content for free, but the player had to upgrade each faction to a ‘premium civilisation’ in order to get unrestricted access to the game and certain exclusive content.
Now, I don’t like the fact that you were forced to upgrade your empire like this, but at least they eventually changed the game so you could upgrade your empire with in-game currency. Paying real money, which lots of players would do for the convenience, was fine, but forcing everyone to pay was a bad idea.
The main problem, however, was that the cost was (roughly) £6.50, which I felt was too much, and so my two civilisations continued un-upgraded and the developers made no money from me for quite some time. Then there was a sale, and these upgrades were available for around £3, which I thought was still a bit too high, but I was tempted into paying to upgrade my army (and I’m sure many others did at that time too). If it had gone down to £2, they would have made more out of me as I would then have been tempted to upgrade all three of my empires. I’m sure I’m not the only person in the game with multiple empires, so they could have made a lot more money (and potentially stayed afloat?) if they had charged less. After all, the upgrade to a premium empire has to be a simple case of flipping a boolean value somewhere in the game and it can’t have actually cost them anything…
Guild Wars 2
Some games, such as Guild Wars 2 or Team Fortress 2, adopt a similar method, except that you have to shell out to buy the game in the first place. I don’t really mind this either, but when they charge you for the actual game and THEN charge you too much for in-game content, it somehow adds an extra sting.
In Guild Wars for example, you get five character slots to begin with (which is a lot more generous than the unreasonable limit imposed by Star Wars: the Old Republic) but you can buy additional slots for what works out at around £8. That is a lot of money, and even though I really want to make more characters, I have no intention of paying that. However, you can at least understand that extra characters take up more space on the server.
The issue I have is that it costs £4 to add one extra bag slot to a character and £6 to add an extra bank slot to your account. I’ve been tempted to get these upgrades, as they’d be very useful, but I never click ‘purchase’ because it seems like a bit too much. These upgrades obviously also take up some extra space on the server too, but if the game is designed properly, it shouldn’t be much and they’d sell a lot more of these if they were cheaper…
Some publishers might not like the idea of free-to-play, but a number of high-profile games have done it and they have done it by giving players unrestricted access to the game and making their money from cosmetic upgrades, boosts and convenience purchases. I think we can agree that the model is here to stay and that providing any experience more restrictive than this just seems greedy (I’m looking at you Star Wars: The Old Republic!).
It is not a guaranteed path to success, but if you properly manage the prices you charge for in-game items and properly motive the player into buying these items without twisting their arm, you just might make a butt-load of cash! Just remember that they’re called MICRO-transactions for a reason…