The global game industry’s roller coaster ride in 2020 was nothing short of amazing. Revenue exploded as more gamers than ever ran for their consoles, PCs, and mobile devices and subscribed to a rapidly expanding selection of games and portals.
According to experts, 2020’s trends were just the beginning of evolving subscription models. Game World Observer’s managing editor, Oleg Nesterenko, predicts PlayStation Now’s audience will reach four million by the end of 2021; also, that Xbox Game Pass will gain twenty million subscribers generating $2 billion this year.
So how can you as a game developer unlock your game’s potential for 2021 and beyond? Partner with Xsolla. Our Subscriptions solution helps you unlock your video game’s potential by enabling you to offer value-rich subscriptions directly to players worldwide. Our partners count on subscriptions to increase user loyalty, boost their income, and provide a long-term added value for customers.
If your game’s monetization strategy is based totally or in part on subscriptions, you’re on the path to success; still, a meaningful pricing strategy is key to converting casual lookers into committed repeat players and subscribers.
It’s not just the dollar amount that matters to consumers; it’s whether your game’s promise satisfies a consumer’s psychological appetite. How you communicate the pricing, how you package options, and how good your audience feels about both the TRY and BUY of your game is the fuel that moves the needle from browsing to subscribing.
No one approach fits all; however, if you know your business and your customers, you can – with help from Xsolla – continue to improve your monetization model and your subscription program.
Here six factors that influence a consumer’s decision to dive into your subscription program.
One of the easiest ways to entice new gamers to commit to a subscription plan is to offer a free, time-limited trial for a no-commitment, first-hand experience of your game. Trial periods hook new players into the game and soothe new users’ concerns about the upfront cost.
To choose the optimal trial duration, look at your program’s billing cycle and offer free-to-play access for a period equal to about ten to twenty percent of their total plan duration. So if billing occurs every thirty days, limit the trial period to 3-6 days.
Consumers are motivated by different measures of value. Some are incentivized by dollars, some by time, and some by features. Multi-tiered plans are vital to giving your users power over their choice.
In this approach, benefits and access-time effectively define value for each tier. 1‑month, 3‑month, and 6‑month option prices differ, but all plans have the same functionality.
Feature-driven tiers offer options from basic to mid-range to premium (for example, Bronze, Silver, and Gold) – each with varying “packages” of benefits, bonuses, AND price.
Many say “variety is the spice of life,” but having too many choices scares us away when making purchase decisions. Human brains effectively perceive three sets of options presented to us, and the rest is more than we can handle. Two makes it hard to choose, while four leaves us confused or overwhelmed.
Marketers refer to this phenomenon as the “Rule of Threes.” While not applicable in every circumstance, it’s known that a subscription program with three tiers makes for an effective conversion model for video games and streaming content.
Whether you call your game’s subscription plans “Basic, Standard, & Premium,” “Bronze, Silver & Gold,” or “Affordable, Awesome & Epic,” customers can easily understand each level’s value. Though they will make the best choice for their budget, your players will likely choose the middle tier. It just feels right. Not too little and not too much. Goldilocks was, after all, a consumer – and probably a gamer.
The Rule of Three does apply to most subscription programs, but remember that you can always conduct an A/B test to uncover the optimal number of plans for your unique audience.
Another way to describe this approach is: Play more to pay less.
Gamers are a savvy bunch. They instinctively know that marketers put a price on loyalty. Offering customers an opportunity to pay a lower monthly price in exchange for their commitment over time makes sense, especially to players whose skills often include negotiation and critical thinking.
Structuring your subscription by duration (1-month, 3-month, 6-month), each with an increasing “discount,” is easily understood as a loyalty bonus by customers.
Xsolla Subscriptions solution makes it simple to reduce the plan price after the first month, so users receive a “discount” in exchange for their commitment. For example: The user pays $10 for the first month, but the price reduces to $7 a month once they sign up for a 3-month plan or longer.
Lifetime subscriptions are an alternative form of loyalty discount that works especially well for MMOs and other games or content services that include downloads, a mobile app, or other software to augment or enhance the experience.
The eternal subscription level often has a low or no monthly fee and typically lasts for either the game’s lifetime or the subscriber’s, whichever is shorter. Programs with lifetime plans are monetized either by initial software purchases plus upgrade costs or via microtransactions, virtual currency, and in-game stores.
Perceived as “free-to-play” by consumers because of the reduced or eliminated monthly cost, this model encourages in-game spending, which often rivals or exceeds what subscribers might have paid monthly for premium access.
A great example of a game with successful lifetime subscriptions is Lord of the Rings Online. EG7 continues to offer a free-to-play version of LOTRO for good reasons: Its wild popularity and revenue. As of December 2020, the MMO aced the former developer Daybreak’s third position for ARPPU (average revenue per paying user), at $51.90, with a 17% monthly payer conversion.
Showcasing your game’s premium-level value by including add-ons and downloadable content is an impactful move for already released games with established pricing. Layering enhancements, such as additional lives, currency, personalized avatars, ad-free play, or unrestricted playing time to your “Gold” or premium tier, motivates free and mid-tier players to level up their experience.
One caveat: Do be mindful of which items you drop monthly and how much loot you include. Add just enough virtual currency, weapons or powers to satisfy subscribers’ desire for value, but not so much as to dissuade your VIPs from continuing to enjoy microtransactions.
As your customers’ tastes change, so should your pricing strategy. A nimble pricing strategy is essential to ensuring business success. It’s a good idea to re-evaluate your monetization strategy once a quarter and – based on data and customer feedback – update your pricing model at least once a year.
Every customer group is unique with different cost considerations: For example, Russian subscribers must accommodate a different national economy than users based in the United States. You may want to adjust your pricing based on the differing needs of your global audience. Xsolla Subscription solution works with you to tailor your program to a wide range of consumer needs.
Rely on analytics as your guide, but consider your customers as your guru. Take surveys, ask for feedback, float new pricing to gauge reaction – from existing AND prospective subscribers. If you don’t ask what they want, you’ll make decisions based on only partial input.
Elevate your pricing plan by:
When you become an Xsolla partner, we can help take care of your Subscriptions program development and implementation, so you can focus on what you do best.
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