Friday, August 30, 2013

Pay-to-Win Games, Part 2: Money-Making Secrets

This is Part 2 of my series on designing pay-to-win games. Those who haven’t read Part 1 may read it here.

The design of a pay-to-win game should encourage players to spend their real-life cash instead of camping. In the parlance of so-called “social games” (i.e., pay-to-win games that you usually find on Facebook and mobile devices), camping means spending days or even weeks at a time accumulating resources to purchase items that can improve the player’s stats without leveling up. As I explained in my previous blog post, leveling up too fast is bad for players. Those who realize this may camp over long periods of time to try to maximize their stats before doing anything that will earn them experience points. From a developer’s standpoint, camping is undesirable because not only does it make for a dull game, but it also allows players to get away with mooching off your hard work. While you can’t expect the majority of players to part with their money, you should aim to get a significant minority to pay you on a fairly regular basis. This blog post reveals the various game designs I’ve seen that encourage players to be repeat paying customers.

Be warned that what I’ve written here sounds downright manipulative in some parts. If you believe that game designers should be as guileless as Santa Claus, stop reading now. If you don’t want your faith in humanity shaken to its core, go to some other website that will fill you with childlike wonder. I’ll level with you. I don’t like the pay-to-win mentality, but I’m amazed that a significant number of players support it. Even if you choose not to make a pay-to-win game, knowing what works in these kinds of games may help you understand what makes players tick. On the other hand, if you prefer to cash in on the pay-to-win scene, you may learn a few tricks from this blog post. Either way, you’ve come to the right place.

Bulk Discounts on Premium Currency

Pay-to-win games usually feature two kinds of currency. The standard currency is earned by purchasing certain items that provide regular income. Premium currency is gained by purchasing them with real money. This kind of currency is then used to buy premium items. Designers will generally want to provide bulk discounts on premium currency to encourage players to spend more of their real money.

Pricing Premium Items

We can categorize premium items into three types. The first type provides a direct and permanent increase in players’ stats. This type of premium item is what pay-to-win games are known for. Depending on the game, these items may come in the form of weapons, armor, units, military buildings, and whatnot. Regular premium items of this sort are available on the market all the time, but others are “limited edition” items that are sold for only a few days before disappearing from the market entirely. Afterward, a different set of limited edition items will be sold. Limited edition items usually provide much better stat boosts than regular items of a similar price.

The second type of premium item does not provide permanent stat boosts but helps in the completion of certain activities. Some premium items refill players’ energy so they can continue to do quests. Others accelerate the time it takes for players to complete a task, such as constructing an income-generating building or traveling from place to place. Others, such as spells in some games, offer stat boosts for a limited duration.

The third type of premium item comes in the form of packages that contain other items that may or may not provide a permanent stat improvement. These packages are rather like booster packs in collectible card games. Some of them are purchased with premium currency. Others are acquired by completing quests but may require the use of premium currency to open. The random content of these packages makes acquiring or opening them a form of gambling, one where the odds may not always be disclosed. This may be legally problematic in some countries, so I won’t discuss them further in this blog post.

Regular premium items (as opposed to limited edition items) that provide a direct and permanent stat boost should be very expensive relative to the benefits they provide. In fact, they should be overpriced. The higher the stat improvement they give, the more exorbitant they should be. If players are desperate enough to purchase these items, they should pay through the nose for them. Other types of premium items that provide an indirect benefit, such as energy refills and temporary spell boosts, should be relatively cheap.

It may seem odd that I would recommend setting too high a price on the very items that pay-to-win games are known for. If developers do that, aren’t they effectively discouraging players from buying them? Yes, they are, and that’s a good thing. Among premium items of the first type, developers expect players to buy the limited edition items rather than the regular ones. They also expect to sell more of the second type of premium item, especially when they are used with quest ladders, which I explain below. The expensive items are actually decoys. They serve as a reference point for making the cheaper items seem well worth their cost. The use of expensive decoys is called price relativity, a topic that has been studied extensively in behavioral economics. It is known to work effectively, which is why developers of pay-to-win games use it.

Loss of Resources to Attacks

In pay-to-win games, nothing irks players more than losing resources to rival players’ attacks. These resources may be units or buildings that are destroyed during an attack, but what’s more common in most games I’ve seen is for players to steal standard currency from each other. Since premium currency is bought with real money, it should be never be subject to theft.

It may seem irrational for players to get outraged over the theft of virtual money, but that’s human nature for you. What’s astonishing is that some players are willing to spend real money on premium items to protect their virtual money. Again, that’s part of human nature. Behavioral economists have known for some time that people fear loss much more than they desire gain. It seems that many people fear virtual loss as much as they fear actual loss. Developers can take advantage of this by providing rewards for getting players to attack one another. This will encourage more players to protect their virtual assets by purchasing premium items.

Rewards versus Experience Points

When deciding whether to complete a quest, players will balance the items and currency to be gained versus the experience points offered. Remember that in pay-to-win games, items that boost players’ stats are good but leveling up is usually bad. Hence, items equate to rewards, but experience points equate to risk. Currency by itself isn’t much of a reward unless it is high enough to purchase sufficiently powerful items. If the rewards cause players to be more powerful than if they were to camp, players will ditch camping in favor of fulfilling quests. Campers will then find themselves helpless against more active players. For this to work, however, players will have to know what they stand to gain by fulfilling the quest. If they don’t know what the risk and rewards are, they may choose to camp instead. As long as the rewards are high enough vis-à-vis the risks, players will be eager to complete them.

Developers should not make all quests particularly rewarding to fulfill, however. Only those quests that may require the use of premium items to complete should have good rewards. These types of quests are generally Limited Time Quests, which I discuss next.

Regular Quests versus Limited Time Quests

Most pay-to-win games have quests that may be completed at any time. Since there is no urgency to complete them, players may camp all they want without missing out on anything. These quests typically reward players only with in-game currency and experience points, so campers tend to undertake them only when they are ready to level up. Limited Time Quests, however, start at a particular date and time and have to be completed before the given deadline. Because some Limited Time Quests are so difficult and time consuming that they require the use of certain premium items such as energy refills or spell boosts to complete them, they tend to offer much better rewards than regular quests. These are the types of quests that should encourage players to be active instead of camping.

By hosting Limited Time Quests at least once every two weeks, developers are more likely to get a steady income stream than if they were to offer only regular quests.

Quest Ladders

Some quests are actually composed of a series of progressively more difficult quests. I call them quest ladders for lack of a better term. Completing one quest in a ladder leads to the next quest in the series. The first quest is easy, but the succeeding quests are more difficult than the last. Likewise, the rewards are initially small, but they get exponentially more desirable as players rise up the ladder.

The best quest ladders I’ve seen are also Limited Time Quests. In these quests, the rewards should be much, much better than whatever premium items may be bought directly. By the time players reach the higher rungs, fulfilling the quests on time may be so difficult as to require the use of energy refills, which can only be bought with premium currency. With the ultimate reward in sight, a number of players will deem the cost worth it.

If players can acquire superior premium items that can only be gained through a combination of effort, energy refills, and temporary spell boosts, they will feel that their expenditure is well worth the cost. In fact, the inferior premium items that can be bought at an exorbitant price are there to make the energy refills and spell boosts look cheap by comparison. Besides, players tend to feel much better about themselves if they get ahead in the game by “playing smart.” Just as predators prefer to hunt living prey than eat something that is already dead, players prefer to win a prize through effort than simply paying for it outright. The best pay-to-win games require their players to earn superior items by being active while paying to complete the more difficult quests on time.

Team Quests

Some games allow players to band together in teams that can pool resources and gain common rewards. Developers can design quests that only teams can complete. Some of these may be regular quests that the team may finish at its leisure, but the quests that are more likely to spur the team to activity are Limited Time Quests. If the rewards for fulfilling team quests are better than those of individual quests, players will generally prefer to band together. The same reward may be granted to all members of a team, or the rewards may be prorated according to how much each team member contributed toward completing each quest. If experience points are given to everyone regardless of their participation in team quests, then even campers in the team may find themselves leveling up faster than they want to. Campers who are not in any team may soon find themselves being trounced by team players.

Evolving the Game

Even after releasing their game, developers should continually mine their data on player behavior to adjust the game as needed. If more and more players resort to camping or simply drop out of the game, developers should try to find out why. If player participation is high but sales of premium currency drops, developers should determine what needs to be fixed. The game should evolve as the need arises, changing the benefits of some items if necessary and introducing new types of quests. If the game never changes in any significant manner after its release, players may get bored and seek other games to play instead.

Wednesday, August 28, 2013

Pay-to-Win Games, Part 1: Why, Oh Why?

When I first got an iPhone, I immediately downloaded several free-to-play games to check them out. It didn’t take me long to realize that for a number of these games, leveling up too fast is an insidious trap. Leveling up only gives you a token number of points to improve your avatar, but the bulk of your avatar’s strength actually hinges on getting other players to ally with you and equipping each of them with certain items that you acquire in the game. These items usually come in the form of weapons or armor, although in some games, they appear as superpowers of some sort or creatures that can fight under your allies’ command. The net effect of having these allies and items is to raise your avatar’s attack and defense stats. There are other items that can be purchased that provide income for your avatar over a period of time. You’ll need this income to purchase better but more expensive items. It takes a long time to generate enough in-game money to acquire the best items that can be purchased at any given level, so leveling up too fast will pit you against players who’ve taken the time to make themselves powerful.

The reality behind many free-to-play games is that they are actually pay-to-win. Most items can be purchased using in-game money, but there are also premium items that can only be acquired by spending a second type of currency that is bought with real money. Players who spend lots of real money on premium items are more likely to trounce players who don’t. This is why games that feature these types of microtransactions are called pay-to-win games.

I find the idea of bringing in real money to acquire significant advantages over other players both disturbing and fascinating. Games are supposed to be tests of skill, so it seems patently unfair to allow players to buy their way to victory. One might argue that professional athletes make use of expensive gear and training to give them an edge in their sport, but the fact remains that no matter how much money they spend, it is still their skill that wins them the day. With pay-to-win games, on the other hand, enough real-life mullah can easily substitute for whatever skill their simple game mechanics involve.

Nevertheless, the pay-to-win business model actually works. I assume that most players don’t spend real money on these games, but the ones who do spend enough to keep the developers afloat. While developers of paid games lose some potential income to piracy, developers of pay-to-win games don’t have to worry about piracy at all. This puts pressure on some developers to abandon their traditional business models in favor of pay-to-win models.

Pay-to-win isn’t a fad. Like it or not, it’s here to stay. From a developer’s standpoint, the question is how to design pay-to-win games that are commercially successful. In my next blog post, I will expose a few tricks that I’ve observed.