Summary
Avid gamers look forward to the release of updates on such games, and examples of these are new items that the players can collect or add for customization. As long as the users are there to support and play the game continuously, developers and marketers can continue to make revenue even after purchasing the game.
Developers use games as a Service (GaaS) to gain more revenue even after downloading the video game. It uses a variety of methods to monetize as well as get user engagements continuously.
For example, you may download the video game for free, but certain items in the game need to be purchased for skill enhancements or more features to be unlocked. Generally, its business model has gained popularity among video game developers and marketers because it can create more revenue than traditional business models.
GaaS has contributed the majority of revenue with 78%. In fact, GaaS is an effective business model since it creates a relationship between developers and their users. The users then continuously help and support the game they’ve loved to thrive for many years.
Now, I’ll share how GaaS works, its effectiveness, and the lapses it can create for marketers. You’ll also get to know the games that use this strategy.
Games as a Service (GaaS) vs. Pay-To-Play
Traditional video games have been using pay-to-play more back then. It’s where you can access and play the game once you purchase it. Pay-to-play usually based their revenue on the number of purchases.
Generally, the game developers would know they’re a successful hit if they sold millions of copies of the game. Therefore, the marketing for pay-to-play is focused more on advertisements and promotional discounts.
Games as a Service (GaaS) acquired more revenue through in-game monetization, such as access to levels or parts of the game, new upgradeable items, and monthly subscriptions.
The Games as a Service (GaaS) Model
The Games as a Service (GaaS) business model has different ways for the game to monetize, which is either directly from users or through advertisements.
Payment Options
The Games as a Service (GaaS) Model has different types of transactions for the users to get exclusive access to the paid feature.
Tiered Billing
Users are charged based on the set of prices for each unit or package selected. Tiered billing can be seen on online software that offers premium packages with different price offerings and other exclusive access as the price increases.
Examples are online CRMs like Zoho or ticketing software like Freshdesk that offer different packages with different price ranges, which users can choose from depending on their budget.
Flat Billing
Flat billing includes charging users a fixed rate or the same amount, either weekly, monthly or annually. Spotify or Netflix has this type of feature where the payment to their subscriptions can be continuously charged from the user’s billing account.
Volume-Based Billing
Volume-based billing is charged depending on their consumption. For example, you want to buy two expansion packs from the game, but if you bought three instead of two, you could have all three at a lower price. Therefore, the more purchases the gamer makes, the cheaper the items are sold.
Microtransactions
Microtransactions are much more affordable for users than pay-to-play games that need one-time payment, which is usually expensive. So microtransactions are more convenient to users since they can still have access to the game and have the option to purchase add-ons that are cheaper and quicker transactions.
You may be familiar with Mobile Legends and how they’ve incorporated microtransactions within their game characters. Their users would purchase skins from their selected character in the game and make upgrades through certain items.
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Virtual Currency in Games
The virtual currency used in games adds elements to the game design and can be used directly within the game. You can convert your real money to the game’s coins, jewels, diamonds, or whatever tokens are used that have value within the game.
Additionally, cryptocurrencies, such as bitcoin, are also used across games. Brands can also collaborate with video games where users can purchase their products in return for double XPs or limited items they might need in the game.
Ads Placement in the Game
There are many avenues through which games can make revenue from their content and other added upgrades. Ads from different brands have been placing their ads on video games since there are millions of users to spread brand awareness.
Since ads across online video games are now common in gamers’ eyes, these have become part of the gaming experience and culture rather than distractions from playing. Online video games are monetizing these ads but can also get them removed so that users can avail of ads-free premium features within the game.
Games That Uses Games as a Service (GaaS)
The following games have incorporated Games as a Service (GaaS) into their content, and you can see it through the game design that uses this strategy.
Fortnite
Fortnite by Epic Games is free to play, but it uses microtransactions through paid features like add-ons or costume upgrades. Its 350 million users and counting have already made $9 billion in revenue in its first two years.
World of Warcraft
World of Warcraft uses monthly subscription services to gain revenue, which is $14.99 per month. In 2020, it had already made $8 billion and made a very active gaming community.
Sims
Sims has many paid features with many customizable items and upgrades you can do with the character and its environment. The Sims franchise, especially Sims 4, has turned into a free-to-play game in 2022.
Sims 4 has used the Games as a Service (GaaS) business model, particularly using subscription service, where subscribers will be given access to exclusive expansion packs.
Candy Crush
Candy Crush Saga was released as a browser and mobile game. The game is also free to play, but as you progress through the game, you can quickly go further in the game through the paid features. Additionally, Candy Crush already got 2.7 billion mobile downloads in 2014 and still is played by millions of users today.
Pros and Cons to Users and Developers
Games as a Service (GaaS) can be promising when it comes to monetizing more features of the game. These pros and cons let you understand the business model to the convenience of its users and the difficulty for developers maintaining the game.
Pros
Exclusive and Early Access
Users, especially fans of the video game, would want early access, and giving them the option to do so, makes them more excited and engaged throughout the game. The early access can produce immediate feedback and suggestions that the developers can take advantage of to fix issues or improve the game.
Fans of the games would appreciate it if the developers would listen to their suggestions since they may have encountered them first-hand.
Fresh Contents to Look Forward to
Fresh content for the game makes the users more enticed by the video game. Users would want to look at your social media updates and keep the community discussions alive. Developers would need to keep the game in demand since they have users to maintain to gain revenue.
Continuous Support for Developers
Video games have turned users into fans, and they would solely show their support by getting monthly subscriptions or purchasing paid game features. The developers, in turn, give back their gratitude for the support, through monetization, in making more content or series in the game.
Cons
Needs New Content and Updates Regularly
The video game in demand would be a great opportunity to use the Games as a Service (GaaS) business model. This means new content within the games must be released regularly to keep the users hooked. The marketing team would always have to be cautious of game leaks that can spoil the marketing and revenue-making strategy of the people behind the game.
Customer Service
As a video game gains millions of users, user engagement, such as in customer service, should have a large scope and team to be flexible to address the users’ concerns. With the fast-changing upgrades or updates within the game, the customer service team should be able to communicate, keep up, and manage the issues regarding the gamers’ complaints.
Final Thoughts
Games as a Service (GaaS) has effectively copied how services are monetized, which will continuously make revenue as long as players are hooked on the game. You may not be new to this concept, as Spotify and other apps have also adapted to giving access to services once you pay for them.
The microtransactions also provide insights depending on the revenues of each paid feature. So, you can tweak minor improvements of the in-game offers or mechanics to increase monetization effectively.
In the digital world, users consume content, and marketers can make revenue by giving them more access to such content. So always leaving them wanting more may be effective, but making fresh content should be maintained for the users to keep looking forward to games that use this business model.
Want to know other apps’ marketing and revenue-making strategies? Check any of these posts!
