From the revolutionary breakthrough of Pong back in the early 1980s to today’s Clash Royale, games have been evolving with new technology, platforms, controls, and monetization strategies. Nowadays, more game developers are moving towards a freemium model in the hope of gaining more exposure for their games (as cost, a barrier to entry, has been removed). This change is most evident in mobile games, where 90% of games on the Apple App Store and Google Play Store are free-to-play. With this relatively new business model, developers rely heavily on In-App Purchases (IAPs) and advertising to gain revenue.
Only a small percentage of players will spend real currency in a game, and the majority of a game's revenue will be generated by them. Therefore it’s imperative that game developers find creative ways to bring in revenue from those players. One example would be the increasing popularity of “chests” as a type of virtual good offered to players (Crossy Road comes to mind as a good example of a game that has popularized this item).
Chests: What Are They And What’s Inside?
Chests usually offer players:
1. Item(s) that are guaranteed
2. Item(s) that have a chance to be inside
Now, what’s inside a chest will vary depending on the game and the chest “type”, but there is always a level of uncertainty and/or chance. As an example; Clash Royale offers players different types of chests. You can see what’s inside a Super Magical Chest (Arena 10) below:
On the surface, this may not seem like gambling but with the added element of chance..isn’t it somewhat of a gamble?
Why Do Chests Work?
- People love to gamble… 😃
- Users purchasing chests aren’t necessarily receiving the item they're hoping for - this can lead to more purchases by the user...see here.
- This also slows down the player's progression, keeping them engaged for longer.
- Opening a chest is more exciting than just receiving an item...the surprise is everything!
- Players may receive free chests as they continue to play
This gambling mechanism is commonly referred to as gacha mechanic in game design literature. If you take a look at many of today’s successful mobile games, you will see that they offer the gambling mechanic to players (check out some examples of chests here). When reviewing the top 10 grossing games of 2016, we can see that the majority of games offered a type of gambling mechanic for a chance to receive a virtual item.
Chests aren’t only popular in the mobile game market but in the console and PC market as well. Premium games like Battlefield 1, Call of Duty, and Rocket League all offer players chests to unlock new items. It’s safe to say, it looks like this monetization technique is here to stay.
If you need help finding a creative solution to maximizing revenues in your game, get in touch!