Comments on: Claim That Playdom is Making $50 Million Seems Overstated

By: EVCinNYC

EVCinNYC — Fri, 02 Oct 2009 22:44:32 +0000

Thanks for the comments Jon — I will have to go with my experience running PowerSoccer.com where we got a lot of trialers that came in and played the game, but the people who drove our sales were those that came back more than a couple times in the first couple days. Once we reached a certain level of engagement with the game, users were more prone to open up their wallet. The DAU to MAU ratio is indicative of the same engaged user to trailer activity. You may have great reach and get a lot of people to trial (a large monthly user base) but more engaged players (the daily user numbers) are the ones more likely to open up their wallets.

Of course I am also assuming that all else is pretty equal – that the items the developer has chosen are compelling and that the check out process and payment methods are optimized. For these large developers, I think they do a pretty decent job of this.

Again, the DAU/MAU is only an indicator, and I’d love one of the developers to provide what Daniel James suggests above. Lacking that, I think we have to fall back on the DAU/MAU metric to show relative potential of different games.

By: Lloyd Melnick

Lloyd Melnick — Fri, 02 Oct 2009 12:03:31 +0000

From my conversations with the various aggregators and other players in the space, a major element of monetizing customers right now is offers rather than direct pay. Thus, the MySpace customer has a lower average problem (probably because they are younger) but for that exact reason they are much more likely to complete an offer (and as they are younger they are probably eligible for more offers), thus generating more revenue than relying on direct pay.

By: Jon

Jon — Fri, 02 Oct 2009 04:25:32 +0000

“To generate revenue from users, a game has to be sticky: compelling enough to get a user to come back day after day and engaged enough to want to open their wallet.”

I’m unsure how dividing DAU / MAU validates these claims. Statistically it looks nice, but it says nothing of end user buying habits. Care to explain your reasoning?

Jon

By: Daniel James

Daniel James — Thu, 01 Oct 2009 20:48:36 +0000

I’ve been told that X-Wars style games monetize better than any other genre. So the balance of types of game may be a key factor.

Also, looking at MAU as a guide to revenue is probably misleading, as there’s a lot of churn. I’d take average DAU and revenue / day / DAU.

By: EVCinNYC

EVCinNYC — Thu, 01 Oct 2009 18:24:59 +0000

Wondering if stickiness wouldn’t be somewhat similar across the different platforms. I would usually think that first mover in a game genre has an advantage (e.g. Playdom with Mobsters on MySpace before Zynga got there, and the opposite on Facebook, with Zynga leading with Mafia Wars), but the FarmVille/Farm Town example leads me to discredit that a bit. Because if you think that stickiness is similar, the Zynga 2x stickiness, would more than off-set the Playdom 32% more installs on MySpace.

By: Eric Eldon

Eric Eldon — Thu, 01 Oct 2009 18:16:09 +0000

Interesting stuff, Eric. A few points:

These are Playdom’s direct numbers, not my interpretation of them

Game developers have long noted that MySpace users pay more, sometimes 2x what Facebook users pay. The reason, from my understanding, is that Facebook users are located around the world, and many of them use the site all the time but don’t have the money/desire to pay for things like virtual goods. The Quantcast numbers you cite only look at the US….

MySpace’s users are mostly in the US, which is the most lucrative market for games based on social networking platforms (I’m not considering China’s Tencent here, for example).

So, it is entirely possible for Zynga to be stickier, but as that stickiness is only visible on Facebook, the company would appear to have a hard time monetizing these users.

Also clouding the picture: MySpace only reports total installs, not monthly active users.

And finally, yeah, Zynga’s numbers could be a lot higher!

By: EVCinNYC

EVCinNYC — Thu, 01 Oct 2009 17:46:11 +0000

Or of course, the Zynga figure could be a LOT higher
Eldon noted that it is also possible that MySpace, with 63% of the users in the US, is paying out higher per user than Facebook (30% of users in the US), but I’m not sure based on the demographics of the users that this is enough to make the difference.