Analyzing Idle Games Ad Revenue Models

What exactly is an Idle game? Quite simply its a game that you click to build points which allows you to more quickly complete a task. Nate Barker of Kolibri games described it best as “An idle game is a spreadsheet with an interface.”

These games are basically resource builders where you build up currecny and once it hits a certain amount, your resource building increases. You can generally buy the ability to gain points faster to progress through the game.

Examples of Idle Games

  1. AdVenture Capitalist
  2. AFK Arena
  3. Almost a Hero
  4. Bitcoin Billionaire
  5. Clickpocalypse II
  6. Cookies, Inc
  7. Egg, Inc
  8. Idle Miner Tycoon

A good example is a summary of the game Taps to Riches, “Tap to make money, tap to upgrade your city’s business buildings, and tap some more! Unlock, hire, and collect as many Advisors and Bizbots as you can to upgrade your business value, build your cities faster, and earn a stash of cash as you rise from rags to riches!”

Idle Games Industry Profile

Traditional gaming has changed a lot with people using their phones for gaming.. The average age of a mobile gamer is 36.3 (compared with 27.7 in 2014), the gender split is 51% female, 49% male, and one-third of all gamers are between the ages of 36-50.

Running a PPC Campaign For Idle Games

When a company runs pay per click ads for their Idle games, whether in an app store or through Google, they are looking at a variety of factors. One of them is, what the ROAS (return on add sales) is after 30 days.

Important Formula: ROAS = Revenue / Cost

Ads are run to see how profitable they are after Day 1, Day 10, Day 30 to see how many users stay in the game and make purchases. They’ll be able to see often by Day 30 how profitable the campaign for various keywords has been. Some ads will break even, or be profitable after 30 days, some won’t.

Ad channels include: Facebook, Applovin, Unity, Apple Store, Google Play Store

Playable Ad Channel: A highly used channel where through the ad, players are able to fully interact with the game and see the highlights before deciding to download it.

Acquiring New Players

When acquiring new players, it is important to go about it in the right way.

1. Balance your marketing and monetization methods
2. Focus on acquiring players rather than just users
3. Keep getting feedback and build your strategies on that feedback.
4. It is hard to find good quality players so make sure you understand who those players are to best target them.

Retaining New Players

Maintaining players is the hardest part of the process after initial acquisition. If the game is over monetized, it could turn players off and lead to a quick drop off. Most strategies recommend finding a balance between the life time value of a player (LTV) and the average revenue per daily user (ARPDAU). Put simply, how does a game balance revenue with value to provide a great experience, but still remain profitable?

Keeping the game mechanics fun and rewarding players is a great way to keep them motivated. As mentioned in the case of monetization, as well, the in ad interruptions to game play also need to be carefully planned. Do you make in game ads that can be skipped in 5 seconds, 2 seconds?

How Do Idle Games Earn Revenue?

For many of these gaming companies, ads are split between in app purchases and advertisements within the game. Users have the ability to either make a purchase to progress faster or purchase the ability to make upgrades through points, in game currency, etc.

Important KPIs To Measure

How do we measure success? There are several Key Performance Indicators to pay attention to when advertising in the mobile games industry.

  1. Mobile Downloads
  2. Installs / Uninstalls
  3. In App Purchases
  4. In Game Ad Revenue
  5. Retention Rate (see the formula below)
  6. Session Length / Depth / Interval
  7. Stickiness (see the formula below)
  8. Average Revenue Per User
  9. Cost Per Acquisition (see the formula below)
  10. eCPM (see formula below)
  11. ARPDAU – Average Revenue Per Daily Active User

KPI Formulas

Retention Rate = ((C– CN) / CS)) X 100
C= number of customers at the end of the period
C= number of new customers acquired during the period
CS = number of customers at the start of the period

Stickiness = Daily Active Users / Monthly Active Users

Cost Per Acquisition (CPA) = Cost / # of Acquisitions

eCPM (Effective Cost Per Mille) = Cost for Advertising X (Impressions / 1000)