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I recently went to an conference and found out that typical user acquisition costs ranged from $60k to $120k in order to get a top 25 title into the app store.

I recently went to an conference and found out that typical user acquisition costs ranged from $60k to $120k in order to get a top 25 title into the app store. Added to this was the fact that you pretty much had to give away the game for for free, and then hope to sell things in the game to the 2% of folks who would buy. So what this really means is that the launch of the game is really the start of an ongoing project to refresh the same title to keep user interest. These are quite daunting tasks to an indie developer who might be able to throw $20k at a project. The best advice that I came across was to make it a point to avoid doing what ever everyone else was doing. So go after a niche gaming audience and maybe even think of another platform where the well funded publishers aren't playing.

jonnathanson 14y ago
To me, the implication here is that you can no longer bank everything on one title. Your first title may need to be a loss leader for a second and third title, to follow shortly thereafter. Hopefully you build a fanbase with the first title, and you try to convert those fans to the subsequent games. This is not cheap, by any means, and for true garage-style indies, it will mean either raising some capital, partnering with others who have it, or being incredibly savvy with PR and guerrilla marketing. Or it may mean a really long, slow strategy, building up a loyal following over the course of a few years. (That's the way a lot of fledgling studios had to do it in the early console days, and it may be similar in the future.) The niche strategy is the other option. I've seen certain niches that have really loyal, under-served fanbases with deep pockets and a high willingness to pay for quality. Take the RPG segment, for instance. Square-Enix (an 800lb gorilla, sure, but still) recently released an RPG for a whopping $30 on the iOS App Store, and by all accounts, it seems to be very successful. I'm sure you can measure the number of people who paid for it in the hundreds of thousands, and probably not the millions, but still, that's a successful launch. A small, hyper-loyal niche without much price sensitivity can be the basis of a very lucrative strategy.
- jblow 14y ago
  Loss-leading is for losers. I mean, it works if you are a large entity with super-deep pockets and a long horizon before you need to make your money back. For small developers it is death. The first dot-com bubble was all about user-acquisition and loss-leading. Look where that ended up.
  - jonnathanson 14y ago
    Perhaps "loss leading" was the wrong term on my part. A more accurate description for what I was trying to get at would be expecting to break even or turn a small profit on the first game, then converting that game's base to a higher-margin second game. That being said, I don't think loss leading, in and of itself, is out of the question for a small developer. There are periods of time during which dropping your price to free can drive a significant boost in trial. This is a valid promotional strategy, assuming it's used sparingly and strategically enough that it doesn't piss off the userbase who paid for the game.

jonnathanson 14y ago

To me, the implication here is that you can no longer bank everything on one title. Your first title may need to be a loss leader for a second and third title, to follow shortly thereafter. Hopefully you build a fanbase with the first title, and you try to convert those fans to the subsequent games. This is not cheap, by any means, and for true garage-style indies, it will mean either raising some capital, partnering with others who have it, or being incredibly savvy with PR and guerrilla marketing. Or it may mean a really long, slow strategy, building up a loyal following over the course of a few years. (That's the way a lot of fledgling studios had to do it in the early console days, and it may be similar in the future.) The niche strategy is the other option. I've seen certain niches that have really loyal, under-served fanbases with deep pockets and a high willingness to pay for quality. Take the RPG segment, for instance. Square-Enix (an 800lb gorilla, sure, but still) recently released an RPG for a whopping $30 on the iOS App Store, and by all accounts, it seems to be very successful. I'm sure you can measure the number of people who paid for it in the hundreds of thousands, and probably not the millions, but still, that's a successful launch. A small, hyper-loyal niche without much price sensitivity can be the basis of a very lucrative strategy.

jblow 14y ago
Loss-leading is for losers. I mean, it works if you are a large entity with super-deep pockets and a long horizon before you need to make your money back. For small developers it is death. The first dot-com bubble was all about user-acquisition and loss-leading. Look where that ended up.
- jonnathanson 14y ago
  Perhaps "loss leading" was the wrong term on my part. A more accurate description for what I was trying to get at would be expecting to break even or turn a small profit on the first game, then converting that game's base to a higher-margin second game. That being said, I don't think loss leading, in and of itself, is out of the question for a small developer. There are periods of time during which dropping your price to free can drive a significant boost in trial. This is a valid promotional strategy, assuming it's used sparingly and strategically enough that it doesn't piss off the userbase who paid for the game.