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How Clash of Clans earns $500,000 a day with in-app purchases
- danso 13y agoI luckily grew up in the time of BBS text games (TradeWars, Legend of the Red Dragon) and never got into the MMORPGs...but from my reading of articles about UO, WoW, and the like, I thought the average casual player could not stomach PvP? And yet in the OP, it sounds like a key mechanic in the game is to prey on players who don't log in as frequently. So while that's fun for the hardcore players, I would've thought that would drive off a large part of the target audience (i.e. casual gamers with iPhones).
- jpatokal 13y agoThat's the beauty of the setup: since things are cheap on the lower levels, raids aren't really a problem, you can earn enough anyway. It's only when you reach the higher levels that they start to become a major pain.
- danso 13y agoAnd so by then, the habit is strong enough to get the casual player to start forking over money? I wonder what the balance there is...I would've guessed that users who were used to playing consistently without paying would have a strong psychological reaction toward having to pay...but I guess if you warm the water in the cooking pot slowly enough....
- jpatokal 13y agoAgain, the psychology is clever: you're not being asked to pay to complete one specific thing, you're given the option of using gems for a huge range of things. So it's not "I need to pay $6.98 to upgrade my Wizard Tower" (which would make most people balk), but "if I let them charge my iTunes account a bit, I get this pack of 1400 gems, which lets me skip some tedious grinding and get all sorts of cool stuff quickly". Also, a lot of people get a single Builder early on for 500 gems ($4.99), and when you've done that once, the barrier to doing it again is lowered.
- epmatsw 13y agoYep, that first builder is hard to avoid. "I'll never pay for anything in this game. What, 50% increase in output? Well, I can reward the devs a bit I suppose..." And thus begins the gemming.
- vittore 13y agoThere is one quote that explains everything: >> Jorge Yao, the game’s undisputed champion, figures he has spent north of $2500 in real money >> on buying gems, and according to back-of-the-envelope calculations, the cost of fully fitting out your virtual >> village is on the order of $5000 when you include walls. It’s little wonder the top clans leaderboard is full of >> players like “>< Royal ><” from Kuwaiti clan “Q8 FORCE” and clan UAE’s “khalifa” (presumably from Bahrain’s >> ruling House of Khalifa). So just make game interesting for this Kuwaiti guys and you are bathing in gold.
- objclxt 13y agoZynga had (and I assume still have) a 'platinum purchase program' that let players deposit money for in-app purchases via direct bank transfer. It was kept rather hush-hush, but it was definitely targeted at those spending thousands of dollars. It also offered things like referral schemes. A sort of 'high rollers club' for social games. I wouldn't be surprised if Supercell (who make Clash of Clans) had a similar thing going. Link: http://www.businessinsider.com/the-secret-dealer-for-farmville-addicts-evil-corporations-in-action-2010-9 http://www.businessinsider.com/the-secret-dealer-for-farmvil...
- Ologn 13y agoFrom 1998 to 2000 I worked at a startup where the IT staff all obsessively played Age of Empires. There were two ways of playing - RM (random map, regular match) which most people played and DM (death match) which is what we usually played. We got to be pretty good as a team, but were never consistently as good as the masters of AOE DM, Team Sudden Death ( http://web.archive.org/web/20000816002743/http://www.laserefx.com/aoe http://web.archive.org/web/20000816002743/http://www.laseref... ). In a 2-on-2 or 3-on-3 against them, they would almost always beat us. One of the rumours that we heard at the time was that some of the children of one of the emirs in the UAE were crazy about Age of Empires, particularly DM mode. We heard a story that they had flown one or more SD members to the UAE for a week or so to teach them how to be master DM players. We heard that SD got very well paid for this tutorial.
- swombat 13y agoAnd how much more awesome would Clash of Clans be if the effort of squeezing every last cent out had been put into improving the game itself instead? Depends. If they were aiming to earn $182 million a year, then it's clearly pretty awesome. If they were aiming to build a great game, then perhaps not as much.
- programminggeek 13y agoI think League of Legends or maybe Team Fortress 2 are about as good as it gets in terms of over-delivering value and not overselling their micro-transactions. Not everyone is going to be so successful with the same approach though.
- trin_ 13y agoLoL is horrible compared to Dota2 in this regard. You cant play every hero and with added points you get addex abilities. Dota2 micro-transactions only pay for cosmetic items that you can (mostly) also get via trading with other players or as a drop after each finished game.
- programminggeek 13y agoThat may be, but I've got tons of hours of enjoyment out of LoL and I kind of like the champ unlocking mechanism just because it gives me something to do/earn, but I'm weird like that.
- Pxtl 13y agoOn the other hand, you can't really blame Riot for needing to grab more money than Valve. Valve has deep pockets and is willing to take a small profit if it means they survive in the long run. Also, Valve's brand is strong-enough that they have players beating a path to their door no matter what they publish. Riot has none of these options. Every player they earn on the strength and reputation of the game alone. They have no cash to fall back onto if LoL doesn't make money for them. If LoL doesn't make money for Riot, the developers don't get to eat. So yeah, I'm not surprised they went with a F2P model with a little bit of pay-to-win in there, and their variation on it (rotating characters and you pay to keep the ones you liked) is a novel and fair approach to it.
- sardonicbryan 13y agoRiot is now part of Tencent, which has a market cap of about $90B. http://allthingsd.com/20110204/chinas-tencent-buys-riot-games-for-400-million/ http://allthingsd.com/20110204/chinas-tencent-buys-riot-game... http://finance.yahoo.com/q?s=0700.HK http://finance.yahoo.com/q?s=0700.HK
- a-stjohn 13y agoI missed the reference about the earnings? Was there one? Are they generating 500k a day or was this projected / estimated somehow?
- keithwarren 13y agoWhere did the 500K per day number come from? The Forbes article put their revenue at 2.4m per day between CoC and HayDay. http://www.forbes.com/sites/karstenstrauss/2013/04/17/is-this-the-fastest-growing-game-company-ever/ http://www.forbes.com/sites/karstenstrauss/2013/04/17/is-thi...
- itsybitsycoder 13y agoThis was the author's source for the 500k number (linked in the article text): http://www.insidemobileapps.com/2013/01/10/supercell-generating-1m-a-day/ http://www.insidemobileapps.com/2013/01/10/supercell-generat...
- kissickas 13y agoThe title only refers to CoC.
- simias 13y agoSo it's the very definition of "pay2win". What I don't understand is how they get people to keep playing once they realize they don't need skill to win, but rather a valid credit card number. Certainly it must feel like using cheatcodes? The victories must feel empty and you'd get bored pretty quickly, at least I think I would.
- msrpotus 13y agoYou can do pretty well without playing but it's just much slower.
- czzarr 13y agoIt's called addiction. They get people addicted to the power that gems confer them. People don't care that they need no skills. They just want that high that the gems give them.
- sharkweek 13y agoAs a former WoW player -- I remember the "thrill" I would get anytime an achievement alert would pop up; those silly little accomplishments became rather addictivie
- dlhavema 13y agoi very much agree, i played an old web-game back in college called OGame that came out before the "pay to win" model, but the basic premise was the same, the more you login the better you do. and what's best was you had to protect your stuff ( planets/fleets ) 24/7 from people from all different time zones.. it very much became an addiction...
- Osiris 13y agoI played a web game for a while that was free to play but had a subscription model that gave you features that made management of a large number of assets (villages) easier to do than in the free version. I played for free for a long time until I ended up with so many resources to manage that I couldn't do it well anymore. I had to pony up the $6/mn to get the advanced features. The problem with these small transactions is people don't see how much it's costing them. If they priced the game at $20 no one would buy it, but they'll be willing to spend $100 if it's spread out of 100 $1 purchases.
- kyrra 13y agoI've been playing Clash of Clans for a few weeks now. I have to say, it's a pretty fun game. Most games that follow a similar layout and design are no where near as polished. The developer behind this game did a really good job making it fun to play. While I agree that the general formula laid out in the blog post, there are a lot of more subtle game mechanics that I feel help to balance the game (though I am no where near the top-tier of the gameplay yet). I can see at the high levels where the money generation vs cost of things would become a problem, but at least where I'm at, it's fun to play. If I get to the point where I hit a wall where Gems are required to really make progress, I'll just quit.
- thangsten 13y agoThe way this article is written leads me to believe the writer has not played the game for long enough to make a fair assessment on the gems currency. I have been playing this game for roughly over a month, and put $10 into gems in the beginning. My roommate started a little over a month before me, and refuses to put money into the game. The amount of time to invest into buildings/resources/farming scales up with how progressed your town is, and gems are present to alleviate this strain. The implication that gems are necessary to win are unfound. The game follows a simple town building principle, use currencies (gold / elixir) to build/upgrade buildings, however you can only upgrade them to the limit your town hall level will allow. The way to gain currency is attack other towns (to steal their resources), or use gems. Even if you use gems to upgrade your things, you are simply progressing further in the game, at the risk of opening yourself up to more powerful enemies. When you attack weaker enemies, there are diminishing returns (look up the loot multiplier). So while gems allow you to progress, you must also adapt and attack higher level towns. These higher level towns can be achieved without any monetary investment in the game. Gems just allow you to reach that stage sooner. I bought gems in the beginning, because the game uses a builder mechanic to limit how many buildings you can build/upgrade at one time. When you start out, you have 2 for free. You can have a maximum of 5, however these are bought with gems and the cost increases each time you buy one. With $10, I soon had 4 builders. With this, I was able to progress much faster than my roommate. I am catching up to his level quickly, almost at where he was in two months time with one month invested. Additionally, gems can be attained for free by clearing brush, however it will be a nominal amount versus buying them outright. But to say gems are required to win this game is not true, but it does save you time versus waiting around a week for a building upgrade to finish. The main thing most people need to realize is this game isn't about spending money, but investing more time into it. The game is a continual uphill grind where the true currency is how much time you devote to it, but I'm still having fun with it for now.
- mcintyre1994 13y agoIt's a shame, though totally understandable, that we won't see these sorts of games without pay to win mechanisms on mobile. They seem perfectly suited for mobile, but even if you charged monthly I doubt you'd make this sort of money.
- kmfrk 13y agoClash of Clans on iOS is doing well.. supercell is making 1 mil a day off of microtransactions? former_zyngite: So much more than 1m a day from what I understand. Yes. Clash of Clans is doing well. That's the understatement of the year. http://www.reddit.com/r/IAmA/comments/1fpbv1/i_was_one_of_the_520_people_laid_off_by_zynga/cacjaab?context=1 http://www.reddit.com/r/IAmA/comments/1fpbv1/i_was_one_of_th...
- cageface 13y agoI really hope this game model suffers the same kind of crash that felled the arcade business in the 80s. At some point I think people are going to collectively realize that they're being manipulated and burn out en masse. http://en.wikipedia.org/wiki/North_American_video_game_crash_of_1983 http://en.wikipedia.org/wiki/North_American_video_game_crash... The overwhelming dominance of this kind of app in the app store has killed a lot of my enthusiasm for mobile, unfortunately. There are a lot of very interesting things you could do with a pocket computer that's always online and equipped with a bunch of sensors but nobody cares because if you're not playing these kinds of slimy games with the rest of the top 20 you might as well not exist in the store.
- kyle_t 13y agoI couldn't agree more, nothing is more frustrating than getting hooked on a game only to realize that progress is essentially crippled without massive amounts of free time or a few in app purchases. I would much rather pay an up front fee (or perhaps instead of crippling the game, a one time fee to unlock the rest of the game).
- ig1 13y agoThat model doesn't really work for apps which are dependent on external servers for multiplayer, etc. as the vendor has on-going costs. Hence revenue needs to be recurring as well. In practice that means ads, subscriptions or IAP.
- simias 13y agoWhat really annoys me is when a game that might potentially interest me chooses to go the pay2win way. For instance, tribes:ascend. I wanted to get into it but forums were full of people saying each time they released a paid upgrade the balance went FUBAR. What annoys me the most is there's no way to do it "the old way" and pay a bigger sum of money once and get the full game without having to upgrade for every single new weapon. That's where you realize that the microtransaction model is a scam, because if you want to buy all the upgrades at once it would cost you several hundreds of dollars. I wish they'd go back to the older model of freeware demo + one time buy full game. I remember buying Doom that way.
- baddox 13y ago> * If you’ve ever played Starcraft, Age of Empires or pretty much any other real-time strategy game, you’ll know the drill, and the buildings and units come off as almost painfully derivative.* That's a strange claim. In fact, I would claim that, if you've ever played Starcraft, Age of Empires, or pretty much any other real-time strategy game, you would be aware that they have very little in common with Clash of Clans.
- coherentpony 13y agoThis makes me feel sick inside. These kind of apps are the wood rot of the modern gaming industry. As soon as I see a "beat your opponent by buying more of our shit" I delete the app. Good fucking riddance.
- jamieb 13y ago"... I can’t really complain about the hours of entertainment I’ve gotten in exchange." "Yet I still can’t help but cringe as I run into all the ways the game is intentionally crippled to get you to pay up, and the way its Pavlovian triggers to come back for more operate on fear." So, sir, you like war games. You observe that this game makes you cringe, and is designed entirely to make you pay up through the experience of fear. Despite this you are willing to pay $4.99 "largely as a token of appreciation to the game’s makers". Game companies that make games that don't intend to extort money out of you are laying people off left and right, and here you are "appreciating" developers that make you cringe. This makes me feel mad and sad. If you are willing to pay $4.99 for a game that makes you cringe, might you be willing to pay $5.99 or even $39.99 for a game designed to make you experience joy? The classic Master of Orion I&II are available for $5.99 from GoG. If you demand a modern experience, the latest XCOM is a bargain at $39.99 on Steam. The original XCOM is $4.99, also on Steam.
- jpatokal 13y agoOP here. I paid the $4.99 quite early on, when I was still at the "joy" stage and before I realized the full extent of manipulation going. But I don't regret it: CoC is a good game, and I enjoyed playing it earlier on. I've now just reached the stage where it's pretty much impossible to keep playing without paying. And for what it's worth, I paid for Master of Orion back in the day when it was still shiny and new, and was quite happy to fork out $15 for the full version of Minecraft, the most "joyful" game I've seen in a long time.
- ebbv 13y agoThis model is Unethical Freemium which has been around for a while now, Clash of Clans is not unique or doing anything new. IMHO, you should not support games that use this model. It's often called "Pay to Win". I will only play games that use the Guild Wars 2 or Path of Exile model; all paid items are cosmetic/fun/convenience only and don't really assist in one player being more powerful than another player. Pay to Win model games are never going to be fun long term because the game will be won/dominated by the people willing to sink the most money into it, rather than the player who invests the most time/thought/skill/etc.
- andypants 13y ago> the game will be won/dominated by the people willing to sink the most money into it, rather than the player who invests the most time/thought/skill/etc. What is wrong with that? Some people have more money to invest than time, and others the opposite. Find a game that suits you.
- ebbv 13y agoBecause it's not really a game then, it's a store where you buy a thing that says "Winner" on it.
- dlhavema 13y agoand you have to keep buying the items or the "Winner status" goes away..
- andypants 13y agoIf the developers put themselves in a non-game category of the app store, it would be alright? Whether something is a game or not isn't defined by how much money you need to spend to play it (or to win it). Plenty of games and hobbies require purchases to play, and plenty give better chances of winning if you spend more.
- danielweber 13y agoA game that rewards who can spend the most time in it isn't really a game, then, either.
- jonnathanson 13y agoIn fairness, the "gems" system isn't unique to this game. I've seen it in quite a few others, especially in the Tower Defense genre. Where it gets particularly annoying is in games with difficulty curves I can only assume were designed to require more resources than the player is allotted naturally, thus forcing him to buy gems and trade them for upgrades. It's not literal payment-gating of advancement, but it is de facto payment-gating of advancement.
- xsmasher 13y agoThis is gross, not net, right? If they're spending 500,000 a day on advertising / paid installs then it's not as impressive. They have the volume, but are they making a profit?
- jkkorn 13y agoI read somewhere, a while ago that games like Clash of Clans are really just payment apps disguised as entertainment. On a somewhat related note, I tried playing Clash of Clans for a month and once the time to complete a building took too unbearingly long, i just became disinterested in the game and opened it less often. Feels like there some variation of the law of diminishing returns, or at least a system suggested by the post that weeds out the patient and stimulates instant gratification. Glad I didn't get addicted :)
- not_that_noob 13y agoCan I buy HN karma points like this? PG could clean out :) I feel like I am addicted to increasing my karma points sometimes. I submit so many things and so few of them get up there on the main page. The one thing that made it to the main page got me addicted to trying, but sadly the ones subsequent to them haven't had the same effect. And imagine - instead of flame wars, we could deploy little hacker-warrior-bots!
- ChikkaChiChi 13y agoPlague Inc. is a great example of a pay model I think works wonderfully. If you want cheats or you want to skip content, you can pay. If you want advanced expansion packs, you can pay. But you don't have to. The concept of a "free" game has been completely destroyed by garbage like this.