How to run offers in F2P games and avoid backlash?

It’s a never-ending debate: On one hand, temporary discounts on IAP prices will generate a quick spike on revenue. On the other, if badly managed they can harm the baseline revenue.

To discount or not to discount? And how to do it to avoid issues? In this article we propose an answer, and share some tips on how to limit long term negative effects derived from running offers on IAP prices and other game content.

Quick disclaimer: This is a short follow-up to my article on IAP packs balance and design. So you may want to check it out if you haven’t already.
Note also that I won’t speak here about how to build and present those offers. If you’re interested on that, I suggest you to check this amazing article from Matthew Emery.

SHOULD I RUN OFFERS ON MY IAPS?

Short answer? Yes.
I believe that, in most games, running discounts on IAPs at it’s a good idea because:

Just make sure you don’t follow an easy-to-stop pattern: On this post at the RAID: Shadow Legends reddit, engaged players have realized that shutting down their spending gets them the best deals in the game, and actively encourage others to limit their spending to get them. Yikes!
Players will expect big discounts on Black Friday and therefore moderate their spending on the week prior, etc. This is going to happen no matter if you plan to run Black Friday offers or not.
But if you don’t run any offer on that day, they won’t spend the money and might be mad.

Potential negative effects

But before we all start running hyper-aggressive discounts of 90% off on all your currency packs, it’s worth talking about the dangers it involved if you make mistakes.
The biggest risks of a badly managed discount strategy are:

Clash Royale runs offers every single day, but in a way that strongly gates their access:
The pattern is unpredictable (the player doesn’t know what stuff will appear on the Special Offers and Daily Deals, and they actively avoid offering wide-use currencies) and the offers have strict limits (can only be bought them once per day).
In Monster Legends we used to run heavy discounts on IAP with certain periodicity, but offers were synchronized with a range of gem-sink liveops, or the critical final hours of big time limited events, in order to make the players gem stocks return to the usual values.
A superb advice by Tom Hammond, who is one of the best accounts to follow on LinkedIn regarding F2P.
Players consuming game content much faster than they should can be particularly problematic if that progression content is particularly expensive to generate, such as in narrative-driven games like Homescapes.

In competitive games with rotative meta, players reaching endgame content too quick can also force the developers to accelerate the release of new content, which may also make the players reluctant to spend because you decrease the usefulness time of the competitive content (Why should I buy the “most powerful unit”? It will be replaced next month…).

And last, even if you can shrug off all previous problems with the release of cheap new content, allowing your player access new playable content too fast also devaluates the novelty value of your content.
If the new content is just the same thing with bigger numbers (like in most RPGs), or has mechanics that are very similar to the ones that the player has already seen, you risk that the player starts to see the game as boring and repetitive faster.

Summarizing, all these issues are born from breaking the golden rule of discounts and offers: You should never provide enough to your players.

Best PRACTICES

Both Brawl Stars and Rise of Kingdoms explicitly mention that their offer packs only allow a limited amount of purchases. This allows them to deliver insane discount values (x5, x8…) without risk of generating long termed unbalances to the game economy.
Don’t take rush decisions based on realtime data, use a 7-days or 14-days rolling average instead (or longer). Is this the first crossover ever on a mobile f2p design article? Maybe.

These kind of actions should be taken without thinking on the rest of the monetization holistically. Due to that, I am personally a great fan of having a clear owner of the entire game economy and revenue. Someone who is in charge on handling the current revenue but also guaranteeing its ability to create more in the future.

If you’re building a product management team, I would advise against having roles whose function is exclusively to create and run offers and will be evaluated based on how well the offers performed instead of an holistic view of the game economy performance and health. That is likely to end up in near sighted decisions.

Apple plans ahead the progressive lowering on the price of their devices, usually linked to the announcement and release of superior ones. Similarly, your plans should include a prevision on when your hot content is going to be discounted, and when it’s going to be replaced by a newer, more powerful stuff.

Q&A

How to detect when offers are CAUSING DEVALUATION?

This is a particularly tricky topic and — in my opinion — is a conclusion that has to be reached by putting together several indicators on different points on the economy, rather than looking at a specific KPI.
Another point here is that you will not be able to know devaluation by asking paying users directly. In my experience, the perception of aggressiveness of a game monetization by engaged users is likely to range from “it’s too expensive” to “it’s ok but the game would be more profitable if it was cheaper”. You’ll have to go to the data

I think it’s pretty reasonable to assume that offers need to be reviewed when you detect several of these indicators:

How to fix a game that IS ADDICTED TO offers?

As we’ve seen before, running an aggressive schedule of discounts may force the game to keep on running them in order to make any money, accelerating the issues previously mentioned. So if you’re on that trench already, how can you get out?
To be honest, I don’t think there is a perfect method to solve this (or, if it exists, I don’t know it), but here are my 2 cts.

A successful strategy I’ve successfully used in the past is to build new healthy sections of the economy and then try to progressively focus the monetization towards on those new, healthy areas.
For example, introducing a new currency and establish a value around it of being valuable and not present on offers. This resource could be only way to get the latest gameplay content or some other high value elements, thus quickly making the endgame revolve around its acquisition.

But what if the compromised parts of the economy are too core to make feasible that players ignore them (for example, if it’s the Hard Currency)?
In that case, the opposite can be done as well: Build new sections of the endgame economy and then focus the unhealthy practices on them, progressively healing the more critical and permanent parts of the system.

In Monster Legends, we were able to decrease the amount of offers on hard currency by introducing a new one (Heroic Orbs), which was the only way to access a new set of super competitive units called Warmasters. Offers and discounts progressively started to focus more on these new Orbs, and less on Gems.

FINAL THOUGHTS

Offers can be extremely profitable if done right, but it’s extremely worth spend extra time making sure that they don’t cause harm to future revenues.
The key learnings are that offers should never provide enough to players (so that the economy doesn’t break), and that your players should never take offers for granted.

I hope you enjoyed this piece. It really took way longer than I expected to write because I had to deal with a spike of work (you know how it is!). I’ve a couple more articles on the oven so I hope they don’t take as long. Until then, please stay safe and enjoy Black Friday!

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JBDev

I’m a game designer, economist and F2P specialist with +10 years of experience on the games industry. I write at https://jb-dev.net/