The Business of “Steambirds: Survival”

Today we launched Steambirds: Survival (SB:S), the first true sequel to the original Steambirds. It’s essentially “Steambirds meets ‘Horde Mode’ from Gears of War” — your goal is to fight off ever-growing waves of enemies for as long as you can manage. Aside from this central conceit, the key differences between SB:S and the original SB are:

  • In SB:S, you can choose from 24 planes, all of which need to be unlocked, and nearly all of which have very distinct characteristics which heavily impact your play style.
  • In SB:S, when enemies are shot down, they leave a collectible powerup where they crash. Judiciously deciding when to collect these (and how to use them) is key to your survival.
  • In SB:S, there are microtransactions. Seven of the twenty-four planes in the game can only be unlocked with cash. One of the twenty-four planes is unlocked for free, if you create an account and sign up for our newsletter.

Monetization headaches

Adding microtransactions to SB:S proved to be non-trivial. To understand why, you need to understand our distribution strategy. We’re excited about Flash because it opens up such a huge audience to our games. Part of that huge audience comes from the hundreds of Flash gaming portals who will happily host and promote your game for free, without any negotiation or formal arrangement needed, in exchange for the opportunity to monetize the game via their own site’s advertising system. Normally, all you get in return (aside from exposure) is a prominent link (or links) in the game to other websites of your choosing. But we wanted more than that – we wanted to monetize content inside the game, no matter where it was hosted. That turned out to be a huge pain in the butt.

If you’re a relatively small company like Spry Fox, there’s no way you’re going to implement your own secure billing solution for microtransaction-based games. You’re going to use a 3rd party solution like Mochi, Social Gold, Facebook Credits, etc. Unfortunately, none of these solutions support a virally-distributed game (Social Gold has been promising support for ages, but they haven’t delivered on those promises and it isn’t clear when they will, if ever.) After wasting quite a lot of time trying to identify a solution that would work, we finally settled on Gamersafe, which is run by the same people who run FlashGameLicense (FGL) , a well-established auction site for flash games. Chris Hughes, one of the co-founders of FGL, worked directly with us to implement Gamersafe in SB:S and has been a huge help, in general.

Many flash game portals will happily host Gamersafe-enabled games (especially since Gamersafe pays them a small percentage of all microtransaction revenue generated by the game.) However, some of the very largest flash game portals will not accept a Gamersafe-enabled game, sometimes because they have their own microtransaction system they want you to use, and sometimes because they simply don’t want a third party API for currency or achievements to be active within their portal, which is not too surprising. In such cases, we’ve decided to either integrate the portal’s own currency system if that is an option, or to insist on a very prominent link back to Steambirds.com (the link appears instead of the cash-only planes in the game.)

A prominent out-link may seem like a trivial thing, but it is not. Large portals don’t like it when the games they host feature prominent out-links, and will often insist that such links be removed. But as a Flash game developer, you have to ask yourself: why are you creating games? To eke out a modest income cranking out disposable content? To be perpetually firewalled from your fans? That’s just not a sustainable business model.

Encouraging conversion

Because we just launched SB:S today, I have no idea what our conversion rate (free user to paying user) will look like, but I promise to post something about this in the future. What I can tell you is that we’re not expecting much – 0.5% would be a real win in my book. The reason for my “low” expectations is this: SB:S is a completely single player game, so we’re missing many of the social hooks one would typically employ to encourage purchase. Additionally, while I think SB:S is an incredibly fun and extremely replayable game, it isn’t particularly “deep,” and that’s going to impact our retention, which will ultimately impact our conversion rate.

That said, there are still things we could theoretically do to nudge the conversion rate upwards, and we’ve done them. Here are some examples:

  • Instead of having eight awesome cash-only planes, we have seven awesome cash-only planes and one awesome plane that you get for free if you simply register a Gamersafe account and our newsletter. This removes one of the major barriers to purchase: the annoying task of giving us your username, password and email address. It’s all totally optional, of course.
  • Some of the coolest planes in the game must be earned with a very large amount of unpaid currency (aka “copper.”) But you can earn those cool planes more quickly if you fly other planes with a high “copper bonus”, which is simply a multiplier that is applied to all the copper you earn during a mission. There are free planes with a high copper bonus — you just need to work your way up to them, and then you can use those planes to unlock the more expensive ones. But if you’re in a hurry, you can purchase a plane with a really high copper bonus straightaways. Or, if you don’t mind spending a bit more cash, you can pay to unlock every plane in one fell swoop.
    • It’s important to note that because this a single player game, and because every plane has its own leaderboard, unlocking planes for cash confers absolutely no competitive advantage on paying players – it simply enables them to progress through the game faster and/or experience more gameplay variety sooner.

I hope this insight into the business thinking behind SB:S has been useful to you. If so, you can return the favor by checking out the game and better still, tweeting about it, posting an update to Facebook, etc. :-)

251 Responses to The Business of “Steambirds: Survival”

  1. Thanks for sharing this David (I tweeted it by the way :))

    I have my concerns about how this flash portal thing is turning out, it seems as soon anybody gets million plus monthly users they’re going to have roll out their own api they want you to use on top of being more and more touchy about links,things are changing it seems (ad revenue not enough!?) which is certainly going to be more of a headache for some.

    I’m creating my own back-end so I pretty much have to use a solution like Social Gold to support the feature set (http://ping.fm/s5OM7) I want to incorporate, hopefully with the Google purchase, things will move quickly for 0’11.

    I guess my content will have to be compelling (as it’s going to be) to remove any friction that may exist due to this choice. I hope SB:S does well for you :)

  2. Why do games with micro-transactions have two currencies? There is always one of low value, you can acquire through playing and one high value you must pay for. From farmville to steambirds I see this all over the place. Why not using a single currency?

  3. @Monkeyget: the reason is generally because f2p games have two different audiences, those who have time but not money, and those who have money but not time. The “earned” currency is generally one that requires substantial time and/or skill to acquire, but no cash. The “premium” currency requires only cash. When you provide both, you enable both audiences to enjoy the game, and in the proces, you actually manage to earn a living, which is a novel concept for many game developers. :-)

  4. Making money off your work? How peculiar!

  5. My dev cycle is long so I’m going to implement some kind of direct monetization in my next game. I haven’t decided on a vendor or if I’ll go it alone.

    I’d be very curious to hear your conversion rates! Personally I think 0.5% might be low, but it may depend on what metric you’re using for player (e.g., hit landing page, finished loading, started game, finished at least one level, etc.)

  6. Cheers for sharing. When you say ‘none of these solutions support a virally-distributed game’, what do you mean? Is it that none of them automated what you ended up building in yourself (ie switching from micropayments to prominent link on certain portals) ?

  7. @colm – if you want your flash game’s SWF file to be picked up and hosted by any game portal that wants it, you can’t use most payment providers. They generally require you to host games with their functionality only on websites that you own and control.

  8. It’s been some time. Can we get details on the monetization success and conversion rate of Steambirds: Survival? I’d love more information on how to most successfully use microtransactions, especially in terms of what payment processors work best/easiest.

  9. David J Edery

    Hey Matt — SB:S has generated about $10k in microtransaction revenue at this point, which is a bit more than we expected given that we didn’t directly integrate any major payment providers (relying exclusively on Gamersafe) and didn’t do anything after launch to modify the game in response to data. I definitely believe that direct integration of Paypal, Credit Cards, and mobile payments is pretty crucial if you want to maximize your revenue. More importantly, you’ve got to keep updating your game and responding to player feedback… which we have been, but we’ve put our ongoing effort into the mobile edition of Steambirds: Survival, which has pretty substantial changes to both its design and monetization. I recommend that you check that out (its free to play) when it is released — you’ll learn a whole lot about our evolving thinking on microtransactions in single player games just by playing the original SBS and comparing it to the mobile version. I’ll write more about this in a future post as soon as I can find the time!

  10. Thanks for the information, David. I’m new to the industry, and I have to say microtransactions are probably the most intimidating thing that I haven’t done yet, just because so much rides on them being successful. So I’m very appreciative of any information about making them work well. I’m very much looking forward to a full post on the subject, when and if you find the time to write it.

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