Get the latest Education e-news
 
  • Analyzing Early Access Finances Of Our First Indie Game

    [05.31.18]
    - Tomer Barkan

  • Conclusions from Sales Analysis

    My main conclusions from the sales chart analysis are as follows:

    • Discounts are profitable. Even a 10% discount, if you don't want to devalue your game, still has a large impact on sales.
    • Increasing price towards the end of Early Access did not seem to have any effect on our bottom line. It may have other effects further down the road - such as allowing larger discounts or more negative reviews due to a higher price setting higher expectations.
    • If at first you're having a rough patch - do not despair! Hard work and dedication CAN turn things around. After launch, our monthly sales were very low, we had an income of under $2,000 per month, not nearly enough to cover our costs. However, several months later we were earning more than $10,000 monthly without discounts, and as much as $30,000 in months with discounts.
    • Supporting new languages can create a spike in sales. Ticking that new language in the store pages seems to generate increased visibility for a time, and increases conversion rates in those countries.

    Marketing Expenses

    Depending on your situation, marketing costs can be minimized and allow for a more bootstrapped approach. I would not recommend, however, to skim on marketing. Unless you already have experience releasing and promoting a PC game, or know someone that does and is willing to guide you, I would highly recommend using a marketing consultation service for as long as you feel you can benefit from it. If you are incapable of having a team member spend a lot of time on marketing, then you should also consider hiring a PR firm to do the legwork.

    We used a consultation service for almost a year before launching EA, which proved very helpful. We then did the EA launch ourselves, spending a lot of time doing all the hard work. The main reason we did it ourselves was avoiding the expense at that time when our cashflow was rather low. Later on, when we were too busy working on the game and felt that we were neglecting marketing, we hired a PR firm to do much of the work for us, and a few months ago we hired a new team member who spends 50% of his time on marketing and community management (150% of his time since we announced the upcoming full release).

    Conferences

    Participating in conferences we classified as a marketing expense. I highly recommend participating in some of these. Seeing and learning from other indies is the main reason while staying in touch with the industry, meeting with press/influencers and having a great time are a few others.

    It is our experience that showcasing in a conference - in our case the ndie Arena Booth @ Gamescom - is not directly profitable. We spent far more than the extra sales we got. However, I still strongly recommend it, because it helps with all the other benefits I mentioned, especially getting to know other indies and learning from each other. It's also a great opportunity to have strangers playtest your game.

    Paid Ads

    As for paid ads, it was my impression that like showcasing in a conf, they are not profitable. We paid around $0.75 per click on average, and less than one of 50 page views end up in a purchase, making the cost of every purchase 0.75 * 50 = $37.5. Considering our game sells for $19.99 of which we get around $12 - we paid more for each purchase than we earned from it. The exception was reddit ads in which we managed to create a very targeted audience and reach a price per click of 0.12$. However this was not scalable, and the maximum we could get with such specific targeting was around 100 clicks per day, no matter how much we were willing to pay.

    Some things that are important to keep in mind:

    • I am no expert. While I did my research before setting up ads, an expert may be able to get better cost-per-click ratios by setting up better targeting or a more appealing ad.
    • PC game stores do not provide accurate measurement of conversion rates. I manually calculated the ratio by dividing the total store page views by the total sales. This ratio may be better or worse if you only consider visits originating from ads.
    • There may be hidden benefits other than immediate sales, such as stores preferring to promote your game due to external traffic, the mere exposure effect, or influencers seeing your ad and promoting your game.

    Stay in Touch

    This is our story so far. A small team of two-become-three working for three and a half years, and finally releasing a full version of the game. We love chatting with other indies, so you're all welcome to join our Discord server and discuss our story or tell us your own. I'll try to post some more of our experiences during Early Access in the future.

Comments

comments powered by Disqus