How can Western mobile games monetize like Japanese ones? According to Ngmoco’s Swedish studio head Ben Cousins, if developers can the change the emotions their games play to during the monetization process, the money will follow.
Cousins — a long-time veteran of the video game industry who worked on free-to-play titles like EA’s Battlefield Heroes before joining Ngmoco — tells us he’s learned from the best. “We’ve really learned how to monetize users from DeNA. At EA I was considered an expert in freemium monetization, and I’m nowhere near these guys in Japan,” he says.
DeNA’s sales figures don’t give much to argue with. The mobile-social gaming giant reported sales of $448 million in its third quarter alone, good enough for $79.2 million in net income. At home, the company sees between 10 and 15 percent of its audience monetize, a far cry from the 1.6 to 2 percent of Western players that currently pay for Ngmoco’s games.
Cousins explains the main problem with monetization in Western free-to-play titles is a focus on negative emotions. Western games typically monetize players who want revenge and in-app purchases usually remove barriers the developer has placed in front of the player or sell a competitive gameplay advantage. Cousins describes these methods as “about as exciting as buying insurance” and thinks they make games less engaging in the long term.
“On Battlefield Heroes, we decided under pressure from [EA] executives to start selling a gameplay advantage in the game,” he explains. “We didn’t see a drop in the audience, but I think we would have seen the audience grow quicker if we hadn’t done that.”
Japanese games, on the other hand, focus on creating experiences where it’s fun to spend money, something he compares to buying a round of drinks for friends or throwing dice at a casino. Cousins believes combining Japanese monetization mechanics with an audience of highly engaged core gamers is the key.
“Our figures tell us something like 40 percent of console gamers in the western world own a smartphone and 20 percent of them own a tablet,” he says. “There’s a lot of untapped demand with these guys, so they might be playing Mass Effect or Need for Speed on a console, but they don’t have so much choice on mobile in terms of getting the same experience.”
Of course, it’s no secret that a well done core-focused title can do well on iOS. Epic Games made more than $30 million in revenue from its Infinity Blade series. While those games are paid, Cousins thinks there could be an even bigger opportunity for free-to-play game of the same quality because core-focused free-to-play PC games like League of Legends have already laid the groundwork.
“There is a kind of unknown, but very nice business happening in core freemium in the western world now,” he explains. “There are companies out there making a lot of money with satisfied audiences. If you can create a world that is visually beautiful, makes sense, and has a strong social element you can do that. If Mass Effect was a freemium game, you’d certainly find people willing to spend $3,000 to $5,000 lifetime on it.”
Cousins’ team is currently working on a free-to-play title that he says will match the tone, gameplay and graphical fidelity of a AAA console game and will marry what he calls “the core freemium experience” with DeNA’s lessons from Japan.
Although still the preliminary development stages, Cousins did reveal some details about Ngmoco Sweden’s upcoming game. It will be original IP and include both single and multiplayer components. He also tells us the game features an all new, never-before-seen control scheme and it doesn’t make use of any buttons or virtual joysticks. The game is due to launch on iOS at the end of 2012.