Updated: Feb 12
Thus far we have investigated my near-miss with freemium gaming, what freemium gaming is all about, the size of the freemium gaming industry, and its links to gambling. In the last article we covered the underhanded tricks it uses to maximize profits at player’s expense. In this, the fifth and final episode in the series, we will investigate what the freemium gaming industry thinks of the people it exploits.
Players into Payers
Considering the sheer size of the freemium gaming market and its multibillion $ a year turnover, you might be surprised to learn that most of the freemium gaming player-base will never spend a single dollar, pound, or euro on their freemium games.
Therefore, it is the remaining minority of players who are generating these vast sums of revenue.
The freemium gaming industry is well aware of this of course, which is why they are on a constant mission to turn players into payers.
To achieve this, they must overcome a ‘hump’. This hump is that many players have an ‘I will never pay’ mindset. To overcome this hump freemium games will often use a ‘hook’, using one or more of the mind-games covered previously. This might take the form of a one-time offer that looks too good to pass up - especially for someone who has already invested time and effort into the game and are thus likely to keep playing.
This leverages the ‘Ikea effect’, a term used to describe our tendency to assign value to something we have made ourselves, even if that something has little-to-zero real value. In a freemium game, this might be a character the player has leveled up to a reasonably high degree or the large size of their farm in Farmville.
One of the tricks of the trade used to turn players into payers is ‘anchoring’. Here the first price offered is high. This primes the player what prices to expect. Then the player is offered a significant time-limited discount. This gives the player the illusion they are getting an excellent deal, whilst the time limit leverages the F.O.M.O. (Fear Of Missing Out).
This might be just enough incentive to get over the hump and turn a player into a payer. Once a player has made that initial purchase, they are statistically far likelier to spend again, and again, and again, since it sets a psychological precedent.
This is why I describe my experience with Family Guy the Quest for Stuff (FGtQfS) as a ‘near miss’. If I had made that initial purchase, I undoubtedly would have made many, many more. “After all, it's only £1.35 to unlock that character…”
This is the first part of the Hook-Habit-Hobby cycle, which is designed to be addictive and habit forming. If you type it into a search engine you will find no end of business gurus advising companies how to make their products (social media apps and games in particular) more addictive. I shan’t be linking to them for ethical reasons
Let’s go Whaling
You might be wondering how I know all this. Do I have a shady anonymous source revealing the freemium gaming industries’ dirty little secrets?
Nothing so exciting I’m afraid. No meetings in badly lit parking structures were needed. The freemium gaming industry not only makes no attempts to hide its business practices, it is proud of them! It even aids other developers to do likewise. But don’t take my word for it - get it from the source.
Let’s go whaling: Tricks for monetizing mobile game players with free-to-play
NB - I don’t habitually do trigger warnings, but for this, I will make an exception. This video may induce rage and disgust, especially if you, or someone you know, has been a victim of freemium gaming’s tactics.
Video by PocketGamerbiz
Amongst the already small percentage of players who become payers, there is a clear hierarchy, based on average spend per month. Below you can see the dehumanizing terms the freemium gaming industry use to delineate these tiers.
Designation Average monthly spends Percentage of paying players
Freeloader $0 0%
Minnow $1 50%
Dolphin $5 40%
Whales $20 10%
(Data from https://www.gamesbrief.com/)
It is the ‘Whales’ that the freemium industry is the most concerned with. Although they make up the smallest percentage of the paying player-base by number, they generate the most revenue overall. This follows the power law.
Whales may not have a budget, and so might spend in the tens or even hundreds of thousands of $/£/€ on a game over several years.
The freemium gaming companies know who these people are of course. They may send gifts and keep in contact with ‘their’ Whales, complimenting them on their achievements and generosity.
This can make the whale feel validated and special, and thus more likely to keep playing and paying. Considering that some whales are particularly vulnerable people, this is especially underhanded.
The Human Factor
Thus far we have concentrated on single-player games. The situation in multi-player games can be even worse.
A major added problem in multiplayer freemium games is peer pressure. In games where microtransactions are for purely cosmetic items, the pressure may come in the form of bullying those who have not spent money in-game. Allegedly, young Fortnite players have been shunned for their avatar wearing ‘default’ costumes, as it suggests their family is poor.
Indeed, the word ‘default’ is allegedly now used as a general-purpose insult amongst some children and teenagers, both on-line and off.
In team multi-player games where microtransactions do have a tangible in-game effect, some players have allegedly been denied entry to a team, or even expelled from an existing one, for failing to spend enough to keep their avatar at a competitive level.
Positive reinforcement may also play a role. Other players complimenting a payer-player on their avatar, and the quality of their in-game equipment, may encourage the payer-player to continue playing and paying.
The ability to pay-to-win can also be a powerful motivator in some multi-player games, as it will allow a Whale to show off and dominate other players.
A ‘keeping-up-with-the-Joneses’ effect may also play a role, as payer-payers may not wish for their avatar, farm, clan, etc. to appear ‘unfashionable’ or ‘weak’ in the eyes of other payer-players.
To legally qualify as a free-to-play game, a freemium game must be possible to play effectively without paying. However, designing it so that it takes an inconveniently long time to make significant progress is acceptable.
This is as important psychologically as it is legally. A player may be reluctant to pay for an in-game item if they do not feel it is particularly valuable to them. However, their time probably is valuable to them. Therefore, they may be more willing to pay for the convenience and the time they will save by not having to grind for it.
Legally qualifying as a freemium game is only the first step on the path to obscene profits. In addition, there are several gameplay mechanics that a freemium game will need to implement. These are;
One: There must be no upper limit to ho