Monetisation 101

How to effectively generate revenue in your Roblox Game

Roblox Game Developers have made over $83 million dollars in revenue since the launch of the platform. In December 2018 alone, the average top 25 game brought in over $200,000. This is quite a lot of money. Today, I wanted to talk about how game developers can ensure that they are maximising the monetisation of their game while maintaining an ethical focus, and ensuring bounce rate of users is not affected.

I’m aware that my name is not really known around here, so let me introduce myself. I’m Jed and have garnered 5 years experience designing and monetising different game products - primarily in Minecraft. My systems have generated up to $2.30 per average user ( ~R$650 equivalent ) for a free to play product. Obviously, Minecraft is not Roblox, and I’m by no means senior in regards to the games industry as a whole. What follows are merely the things I’ve learnt since I’ve started.

The primary broad goal of this is so that game developers and designers can incorporate these lessons into what they already operate with. Hopefully, the result of this is more refined monetisation for your Roblox game. The more revenue the games on this platform produce, the more talent is attracted, and the more money there is to invest in bigger teams and grander games. Snowball ad infinitum.

Let’s talk Terms

Before we really delve into this, I wanted to talk about a couple of terms. These will not only allow quicker communication within this writeup but if people start using them within the community itself, will also hopefully an increase in communicating monetisation strategies and data across the platform as a whole.

ARPU - Average Revenue Per User

The amount of revenue, on average, a user generates.

F2P - Free to Play

When a game does not cost anything to play (a vast majority of Roblox games are F2P).

P2P - Pay to Play

When a game costs money to play

Hard Currency

A virtual currency backed by real worth (Robux is a hard currency, as you can buy more with actual money).

Soft Currency

A virtual currency that is not backed by real worth (there is no way to exchange this with actual money).

P2W - Pay to Win

Something your players will call your game if they think you’ve over-monetised.

What even is a Player?

In game design, players are classified into different groups depending on what mapping is used (for example, players are made up of Achievers, Killers, Explorers etc). This classification is defined by how the player plays your game. When it comes to monetisation, however, we don’t really care about that. We want to focus on how the player spends their money.

As such, there are 3 different types of player. It is very important to design a monetisation system around these, ensuring that you are maximally targeting each group. Note that these player types are relevant to F2P a lot more than P2P, with no additional monetisation.

First Purchase User

This user has purchased a single item within your game. The first purchase is always the most difficult to convince a player to take, so once a player becomes a First Purchaser, consider this a big win. Generally, the first purchase is not going to be worth a lot of money, and the player will often make their purchase to either congratulate themselves on achieving something within the game or - a lot less frequently - buy something as a ‘thanks’ to the game developers.

Once players have made their first purchase, they’re also now more invested in your game and generally will end up playing it more. If dealt with correctly, you can ensure this increased level of engagement causes them to move over to the next category of players. We know that 95% of people who purchase Robux purchase it more than once (from 2018’s RDC talk), so this is definitely viable.

Repeat Purchase User

Once that first purchase has happened, it becomes a lot easier for the player to quantify purchasing more things within your game. Generally, this includes the player being comfortable with spending more money at a time as well.

At this point, players will still generally look to purchase items as a form of self-congratulating on achieving something, but as their engagement within the game increases, a number of players will start making repeat purchases to allow them to progress through the game quicker. This is especially true in competitive games.

If you manage to retain a Repeat Purchase User for long enough and provide them with intelligent monetisation design, you may convert them to the next and final category of player.

Whales

Pick a random game that’s been monetised. There is pretty much complete certainty that at least 75% of that game’s revenue is generated by only 1-5% of its player base. These players are called Whales - a reference to their massive monetisation potential! With such a large amount of revenue generated by these players, a game generally lives or dies depending on how many Whales it can retain.

It requires a lot of work and time to convert a player into a Whale. First, you have to convince them to make that first purchase, so they become First Purchase Users. Then you need to continually provide them with a plethora of different monetisation options for them to become Repeat Purchase Users, and continue to do so in an intelligent manner so that they generate a relatively large amount of revenue for your game. Whales are pretty much the only player group who are comfortable with purchasing expensive items and are generally your most engaged players.

Time to open the Toolbox of Monetisation

As hinted at in the above section, converting a player to the next category requires a slightly different approach each time. As such, there are lots of different things that games monetise. This section goes through some of the primary different tools that designers use to create intelligent monetisation.

Pay to Join

This is when the player has to purchase the game before playing it. It’s also the most simple implementation of monetisation. If this is the sole monetisation method for the game, then a lot of the lessons here are not necessarily relevant - all you have to do is convince the player to buy the game, then their financial worth to you is nothing.

Most Roblox games don’t do this, with the notable exception of Bloxburg and Vesteria. A number of developers also use this while their game is in development, which is a very clever way of adding simple monetisation without any additional work for the developer.

Generally speaking, it seems the thumbs up percent of a game is increased if it has a cost entry. This makes sense, as every single player is a First Purchase User, and therefore is already engaged within the game before they even join it for the first time! I would not personally recommend this be a strong factor when designing your monetisation system, however, as it does not necessarily correlate to success (as shown by games at the top of popular with a markedly lower thumbs up percent that less popular games). When substantial traffic for the biggest games comes in via YouTube, that thumbs up percent matters less.



A majority of games are Pay to Join, although it’s slowly getting less popular

Subscription

This is when a player pays periodically (normally monthly) for an item. Within video games, this is one of my personal favourite types of monetisation. The catch with Roblox is that there is currently no functionality to automatically charge a player when their current subscription runs out, so it’s benefits are slightly reduced on this platform.

One of the powers of subscriptions is that the player doesn’t buy something upfront. As we’ve learnt previously, first purchase users do not generally like making a large purchase. A $3/month item seems a lot more preferable than a $20 one off purchase.

Since the shift to F2P, subscriptions now are generally offered alongside a free option. Runescape is a notable example of this - you can play the game for free, but to unlock additional content (skills, maps, quests, and more), you have to pay a monthly fee. This provides non-paying players with some content while showcasing how much more awesome their gameplay experience would be if they purchased the item.

There is also a much larger - and more recent - implementation of subscriptions that are perhaps a lot more relevant to Roblox. Battle passes, made popular by Fortnite, are found in a multitude of competitive games; particularly Battle Royales. For people who have not come across them before, the work a bit like this: every couple of months, a new battle pass is released. This has a level associated with it, and players have to succeed in the game (generally by winning specific, changing challenges) to level up the battle pass. At every milestone, they get some reward within the game itself. However, if the player actually purchases the battle pass (which is generally at a medium price point), the amount of milestone rewards they receive increases dramatically. As a final nail in the coffin, a large amount of the major rewards are exclusive to that battle pass only.

I previously mentioned that players - especially players that you have yet to convert into engaged Repeat Purchase Users - often make purchases to reward themselves for achieving something within the game. This is a perfect match when it comes to the battle pass, as players feel like they are gaining all these rewards by playing well, not from a purchase - as such, they feel much better.

Notable implementations of this also play with the pricing in clever ways. If players purchase the battle pass and max out its level, they can receive just enough currency to buy the next battle pass. This provides a strong argument for converting first-time users, because they just need to purchase a single item, and they should receive increased rewards from that point onwards. Seems like a bargain! However, this is where games release exclusive items to purchase with the currency between each battle pass. It is within their interest to make the player buy something so that they cannot afford the next battle pass with in-game currency. They then feel obliged to buy it with physical money instead.

Fortnite’s battle pass implementation. Note the free rewards in the top row and the paid rewards in the bottom!

Currencies

It is at this point that we start to actually unpack microtransactions. I’m aware this write up is not specifically about economy design - and there’s enough to get through as is - so I will skip over that.

Robux is a hard currency. Chances are, your game should also have a hard currency. This is a powerful tool in monetisation because it provides an easy platform to tease interest within players to buy something within your game. Companies who make mobile games - particularly the studio Supercell - are particularly good at this, and have invested a lot of time and money into researching how best to utilise hard currencies. As such, we should definitely try and learn from the way they implement things.

In a game such as Clash of Clans, you will notice that you slowly accrue the hard currency (in this case gems), just by playing the game. Why is this? The designers have definitely not created this feature out of the kindness of their hearts towards non-paying users. Supercell is a company after all.

People want what they can’t get, and there is no better way to exploit that than showing them what they could have, then snatching it away again. The slow accrual of gems in Clash of Clans allows players to make small, infrequent paid purchases. If they want to purchase something meaningful with their gems - well, they’ll have to increase the amount they have, and that requires getting out the credit card.

As previously mentioned, I don’t want to delve into game economics here, but something too important not to consider is ‘exclusivity’. All economies - virtual or otherwise - have sinks and gains, namely places where worth leaves the economy, and where worth enters the economy. We also know that generally speaking, the rarer something is, the more players want it. If players can spend $5 to buy some gems, or just play for 10 minutes to get the same amount of gems, which one do you think they’ll go for?

As such, hard currencies must be carefully designed so that they remain rare. This gets harder if you consider that your game might be live for years, with a living, breathing economy. It requires continual monitoring to ensure that you walk the fine line between making it too readily available and frustrating players by its scarcity.

Clash of Clans’ store

Random AKA Loot boxes

This tool of monetisation - generally produced in the form of loot boxes, allow the player to purchase an item that provides an unknown reward. This reward might be rare, or it might be worthless, the player just doesn’t know until they’ve purchased it. This one is a can of worms. In China, it is illegal for a game to provide random purchasables without first showing the player everything they can get, and the chances they can get that item. If you’ve been following the news over the last couple of years, some European countries are currently investigating if this is gambling. If it is, it’ll become illegal for minors.

Loot boxes, in particular, are so popular because they generate so much revenue - players will continue to purchase until they find what they were looking for (which, if it is very rare, might be quite a while!). The gaming community as a whole is pretty aware of loot boxes and strongly dislikes them. You can thank EA’s over-exploitation of them for that.

However, there is definitely a correct way to implement them into a game, and in ways that players like. For one, you could offer only cosmetic items within the loot boxes. While this removes any comments of ‘P2W’ in your game, it is very difficult to get right. As they don’t provide functionality, you have to absolutely nail the exclusivity factor discussed above to make a strong case for players to actually purchase anything. The other approach is to effectively follow what China has, which is complete transparency into what the player could possibly get. This ensures that the player knows precisely what they’re getting into before they make a purchase, and are not fully duped into what is arguably gambling.

Getting some rewards from an Overwatch loot box. Note the differing rarities!

Gimme the where’s

That’s a lot of different tools which a designer can utilise when designing their monetisation system. However, we also need to consider where monetisation is best placed.

One of the easiest parts of this issue is cosmetics versus functional. Cosmetics are items that do not provide any functional benefits to the player that may make them more powerful in the game. To sell these, you have to sell the social value of the item (“Wow, I’ll look really cool with that item, and everyone will notice it”). They generally do not monetise as well, but players will prefer to see cosmetics monetised in a game over functionals.

A functional item is something the player could purchase that does actually provide them with a bonus (for example, a sharper sword, or better gun). These will definitely monetise better, but you have to be very careful. If a player repeatedly loses against people who have purchased items, they will feel cheated, and stop playing your game (trying to get someone to purchase an item to fix this is never good, as you always want to offer purchases with a positive outset rather than a negative one). Moreover, if a player purchases something that removes the challenge in the game for them, they will no longer be engaged, and also eventually leave. This is particularly bad because you want these players to definitely stay around and continue purchasing things.

This issue is more pronounced in competitive games - especially if they’re player versus player. It’s a careful line to walk between increased monetisation, while not lowering retention due to the issue of player’s purchasing too much power within the game.

It’s aliiiive! I think? Let me check

I’ve now spoken about the different player types, a bunch of different tools available to the designer, and good places to monetise. How to fit all these different pieces together, though?

It is highly important that a strategy correctly targets each group of player, with the primary goal of converting them into the group above. To that end, let’s look at converting a single, non-paying player into a whale.

Challenge 1 - How to make them buy their first item

This step is definitely the most difficult. This is why a large number of games will add a fake time constraint to items so that they can prompt immediate purchases (for example, you only have 5 hours to purchase this awesome new thing that is 20% off!). While this helps, it is not actually the strongest tool in converting someone into a Single Purchase User. As previously mentioned, players want to congratulate themselves, and they also want exclusivity.

This set of requirements actually allows the design of a very interesting purchase option. When the player hits their first milestone achievement (maybe it’s hitting level 5, reaching a new area, of finishing their 3rd quest), they will want to congratulate themselves on it - now is the perfect time to suggest a purchasable. The time for this should be 30-60 minutes into gameplay, just as they start to get engaged within the game. This purchase option is specifically just for them, as well! That’s the exclusivity box ticked. And finally, we have the item as that 5 hours to purchase a 20% off bundle. The pricing of this item needs to be carefully calculated. It should feel like a cup of coffee to someone - they’re enjoying the game, doing well, and this is a great deal? Why not put a couple of dollars into the game. Challenge 1 complete.

Challenge 2 - How to make them purchase again

As previously talked about, the player will immediately be more engaged once they make that first purchase. The hard part is over - now, the system just needs to carry on what it was doing. When the user achieves their next goal, a couple of hours later, prompt them with another exclusive bundle - only this time, it’s a little bit more expensive. You can continue using this tactic throughout the entire player’s game experience - just ensure that it does not frustrate them at any point.

At this stage, the player may want to look at a normal store as well, so it’s important to ensure that the player can easily access this. As they’re more engaged in the game, they may go and make purchases on their own. A lot of games will often make the user go to the store interface to collect some free items - even if they immediately close out of it after collecting their reward, it will gradually cement the store’s existence to them, and ensure that they see every promotion, sale and event.

Challenge 3 - How to make them purchase again, again

At this point, the success of converting the player into a whale also depends on their personality and disposable income. However, you need to ensure that they remain perfectly engaged within the game for lengthy periods of time to increase this chance.

Most games on Roblox are offered as a service - they have continual updates and improvements after they’ve launched. This is obviously different to the latest CoD or Halo release. The ability to release these updates allows the designer to create systems that provide continual opportunities for whales to repeatedly purchase medium to large sized items. The previously talked about battle passes are a prime example of this.

How do you know that your system is even monetising well? This is where analytics step in. Roblox obviously provides some base analytics for all games, but these are not specific to the systems you may have in your game. As such, they do not provide meaningful enough insight into how your monetisation is going.

Much like economies - this writeup is not about gathering and reading meaningful analytics. You should, however, be tracking gameplay data that at least allows you to answer the following questions:

What’s the average time for a user to become a First Purchase User?

What about repeat?

What is the percentage of users converting into the next stage?

This is obviously a deep, highly interesting rabbit hole to wander down. Another time, maybe.

A couple of pretty good Case Studies

As I start to round this all up, I think it’s a good idea to look at some case studies, and how they monetise. These case studies are of course not from Roblox itself - looking into the games industry for lessons is going to be the key to successfully improving the average quality of games released on this platform.

Brawl Stars

This is a F2P mobile game developed by Supercell. A majority of its monetisation is via a hard currency called ‘Gems’. Players purchase gems with real money, and can then spend them on cosmetics, as well as loot boxes. These loot boxes can provide rewards such as other currencies, as well as brand new characters for the player to play as. Some of these characters are very rare, increasing their perceived worth. However, I would argue this is still a relatively ethical implementation of loot boxes because a character does not inherently provide a bonus over another player, just a different playstyle.

Note the targetted bundle on the left-hand side. They’re trying to convert this user into a purchasing one!

Apex Legends

The recently released Battle Royale game was developed by Respawn Entertainment. Much like Brawl Stars, it also has loot boxes that can be purchased (I told you they made lots of revenue!). However, these loot boxes provide purely cosmetic changes - due to the game being fiercely competitive, there is no way to implement something that isn’t cosmetic without everyone labelling it as ‘P2W’. The cosmetics come in different rarities, and there are literally hundreds upon hundreds of different types. As such, players will buy multiple crates so they can get that legendary skin.

Apex is also launching a battle pass in the near future (a week or so away at the time of writing this). Looking at the success of Fortnite, this is blatantly an extremely powerful monetisation tool for all games.

Some of their timed-exclusives on the store. Look at the different currencies they have - one hard, and two soft.

Runescape

I hope I’m not showing my relative age here too much by talking about this older game developed by Jagex. This is a classic game, that has been very simply monetised. Players are split into two groups - normal, and premium. By purchasing premium - which is a monthly subscription, players get access to over double the content they would otherwise. This allows players to become engaged with what is a fantastic game, before making that purchase choice.

They also utilise the lesson outlined in the ‘currencies’ section above about teasing paid features. Players can trade bonds with each other, which is an item that can be redeemed for a set amount of premium member time. This promotes players to play the game more so that they can achieve this - but of course, if they’re more engaged, they’re more likely to just go ahead and make the purchase themselves anyway.

You’ll notice they try and also entice with a trial of the membership. This is them trying to hook the user.

I would recommend taking a look at some of your favourite games that have monetisation beyond just being P2P. Large games put a lot of research and money into how to monetise properly, so studying the successes is a very good way to gain valuable insight into improving your own monetisation systems.

This is the part where I leave

Well, that’s all folks. If you got this far, thank you very much for taking the time to read about what I have to say. I hope you found it helpful!

I would love to hear your thoughts about what I’ve written, or monetisation generally. If you want to reach out to me privately, feel free to PM me on these forums, or add Jed#1512 on Discord. I’m also on Twitter: https://twitter.com/peraldon.

I would also like to know if you would be interested in some other things that I’ve learnt - maybe expanding on the analytics or economy design that I very lightly brushed over. Let me know below!

For the Super Geeks

If you’re sad like me and would like to read some further articles written by people a lot more intelligent than I am, here are some links: