This post was originally published on GameFront, which is no longer in operation. It is replicated here for posterity’s sake.
Free, microtransaction-driven games are here to stay.
It seems like every multiplayer title on the computer or phone these days is using the free-to-play (freemium) model. While the genre is still in its infancy, most developers tend to adhere to a few specific design styles that emphasize the old gambling adage of “separating a sucker from his money.” The best defense against being tricked is knowing the tricks yourself, and I’ve got the lowdown on all the ways developers aim to part you from your money.
This knowledge is not an inoculation against the temptation of freemium games. Rather, it will allow you to make an educated decision as to whether you really want to give a developer your money. By knowing all the tricks, you can figure out whether or not you want to fall for them. It’s entirely possible that you will do so quite often! I’ve shelled out far more than I care to admit for some freemium games.
Before we get started with the different design styles, you need to understand the basics of the freemium model. Developers who produce freemium games measure their users by a few metrics: average revenue per user (ARPU), lifetime value (LTV) and churn. ARPU is simply the total revenue of a title divided by how many people play it. LTV is how much a player puts into the game while their account is active. Churn is how often players – especially players that have paid – leave the game.
Think of it like an ocean where the players are fish and the developers are fishermen. The fishermen want many fish (ARPU) that are nice and plump (LTV). However, if the fish are constantly escaping the nets and warning other fish off (churn), the fishermen can go out of business. Developers want maximum ARPU and LTV while maintaining minimal churn. They want you to stay addicted and pay without being forced away through frustration or anger.
The players who do this – keep playing and keep paying – are called “whales” (a term from gambling circles). Their LTV is off the charts, and the often spend hundreds or even thousands of dollars on decking out their accounts with all the cool stuff they can. Whales are the current focus of freemium design, and developers aim to convert as many players into whales as possible. A small percentage of whales can contribute immensely to a game’s revenue, and the continual conversion of subscription-based titles to the freemium model – with accompanying revenue boost – is proof of just how much players are willing to pay.
So now that you know what freemium developers want from you, it’s time to tell you how they take it.
Time Compression
Time compression is the most common mechanic in the freemium world, bar none. If you are familiar with games like FarmVille, Mafia Wars, League of Legends, or Planetside 2, then you know all about it. It is an ubiquitous mainstay on the experimental landscape of freemium games ever since players complained about “paying for power,” and it will never go away. But what exactly is it?
If time compression sounds simple, that’s because it is. Developers create a massive grind that players must surmount to progress. While you can technically play and achieve everything, it would take many hours per day just to keep up with the pace of newly released content. This is either because the content released has a steep price tag (economic compression) or because it requires a high level in order to use (experience compression). It is akin to a developer setting up a long, winding, snake-like road from point A to point B.
However, there is an alternative. You find out that you can take a toll road that goes straight from the start to finish instead of traveling the arduous path. All it takes is a measly five dollars. In less metaphorical terms, the developer offers to eliminate the grind for you completely, but at a small monetary cost. You get your gear, and the developer gets your money. Boosts also fall into this category. It’s a win-win! We all get what we want. Except not really.
Why it works
Time compression works because every system in a freemium game is naturally weighted to require a large time investment. Developers rig the system so that it is very undesirable for you to continue with the grind. The house always wins, and in this case the bet is whether your patience can last the entirety of the grind you are told to do. Most freemium developers know you – statistically, anyway – better than you know yourself, and getting you to crack under constant pressure is their job.
In addition to this test of patience, those that do continue grinding find themselves behind their fellow players. What starts as a mere inconvenience of time turns into peer pressure to keep playing. All players want to keep pace with their friends and competitors, even if the competition is as simple as watching spreadsheet numbers tick up.
Time compression fails when the grind-to-reward ratio is too high. This time investment ratio is interesting in that different cultures have different values regarding grind. Westerners, particularly Americans, have a difficult time accepting large grind in their games. Titles which do have such steep time requirements – like Tribes: Ascend, before costs were lowered – tend to be hammered by annoyed consumers who don’t want to spend countless hours on what may only be a marginal upgrade. In comparison, steep grinds are a distinct feature of Asian MMOs. The threshold between tolerance and anger is a fine one.
Cosmetics
Everyone loves looking pretty. Good-looking outfits and decked-out houses are status symbols, after all. The virtual world isn’t that different. Cosmetics options in freemium titles show that a character is, as the song goes, a man of wealth and taste.
Cosmetics are generally broken into two types: pure and hybrid. Pure cosmetics are what you would expect: garish and fancy clothing for the discerning character. Hybrid cosmetics roll additional bonuses in with your purchase so that you are purchasing both new gear and a new shirt. In other words, players pay to win at the game. The harsh feedback from such systems resulted in hybrids shifting away from raw power buffs and more towards time compression buffs, like a shirt that gives you more XP or gold as long as you are wearing it.
Why It Works
Cosmetics options work because we are, at our core, social animals. We want to be accepted and admired by those we deem our peers. This is just as true in MMOs as it is in the real world, and is an incredible driving force behind sales. Cosmetic options can even give players prestige that is unearned and unwarranted, as their fancy new outfit gives the impression that they are more successful and well-versed in the game than they actually are. Who do you value more, after all: the king in his glowing magical robe, or the warrior in shoddy leather armor?
A good example of this in action is in League of Legends. Among lower-tier games, skins are often seen as a sign of skill. After all, who would waste real money on a skin for a character they don’t play obsessively? The result is that players value regal-looking players higher than those in the default skins. A player’s money has bought them status in the virtual world, despite that status potentially being undeserved.
Withholding Features
I really, really detest developers that withhold features. It’s not a very common practice, but it instantly drives me up the wall when I see it in a game. For good reason, too: While time compression relies on game mechanics being fun or addicting enough to hold a player’s attention, withholding features relies on that fun being ransomed. It’s a terrible practice that still has proponents in freemium designs.
Feature-withholding is the act of restricting a player’s access to features based on how much money they have paid. You could argue that this includes time compression (since that nominally witholds features, like new skills and items), but the distinction between time compression and feature-withholding is that you can’t get these features by just playing the game. While a lot of games do this to some extent or another, a few outright prevent players from accessing basic quality-of-life features unless they shell out money. Want an in-game bank to store items? Pay money. Want access to all your crafting skills? More money. Actual XP gain? Keep giving us money!
Why It Works
It doesn’t.
No, seriously. Withholding features doesn’t work. On a large scale, at least. It results in an increasingly pissed-off player base that rails against design decisions and rebels against developer rule. It is the worst kind of low-blow freemium nonsense, and it (deservedly) can cripple a game’s profit margins. It is the freemium equivalent of on-disc DLC or restrictive DRM, and players hate it.
The most egregious example of feature-withholding that I can think of is Star Wars: The Old Republic. Free players earn XP at a far slower rate, can’t train all their crafting slots, are forced to get abilities and mounts later, can’t hold as much money, can’t use the bank, can only use a tiny amount of market slots, and countless more arbitrary and upsetting restrictions. Take a look for yourself. This is not how to design a freemium game. It’s a way for you to twist the screws to force people to pay when they don’t want to.
The moral difference between withholding a feature and time compression is that, ultimately, time compression relies on the user’s weakness rather than a built-in problem with the game. Grind is steep, sure, but surmountable. Feature-withholding relies on the game being weak to force the player to pay to make it strong. It is an incredibly awful method of designing, and I detest every game I’ve ever played that has it.
Odds And Ends
Most freemium games have a list of “odds and ends” that contribute to their revenue without being one of the above mechanics. The two that are most common are expansion packs and lockboxes. While both share some elements with feature-withholding, they frame the decision in a way that is a bit more palatable to the end user.
Expansion packs – otherwise known as adventure packs, or dungeon packs, or any number of other titles – shouldn’t need much of an introduction. If you play MMOs, you surely know about them. However, most MMOs have begun the shift toward expansions being free, named updates rather than big boxed sets. To replace this revenue, developers have taken up releasing “miniature” expansion packs that consist of self-contained storylines and abilities.
Lockboxes, on the other hand, are simply a way to make rare drops give the developer cash. Rather than having rare and legendary items drop from normal monsters, lockboxes drop. Characters can spend a dollar or two to buy a key that unlocks the box. The items contained therein are usually (but not always!) significantly better than the items you get via mission and normal drops. Oftentimes they include other freemium items like boosts or cosmetics so that there is an element of gambling to the system to make players return.
Why They Work
Expansion packs work because they aren’t necessary. The main story arc, the missions and professions you wish to do, and all the gear you could ever want are in the game you started playing. Expansion packs may give you more options and customization, but they aren’t required to have fun. Oftentimes developers will even include “demos” for expansion content by allowing limited access to all players.
Lockboxes work because they are powerful. Games like Team Fortress 2 and Star Trek Onlinehave functional lockbox systems because you get fantastic – often normally unobtainable – items out of lockboxes. For example, you can only get strange items and parts in TF2 from a lockbox. While opening a box is always a gamble, most developers weight the system so that players feel like they are getting their money’s worth out of the unlock, even if it is just a small boost and some minor rares.
In both cases, the players that pay are those that are dedicated enough to the game that they dump money to “complete their collection.”
While these are not the only ways that a developer can cajole you into paying, they are certainly the most popular. When done right, they can provide a valid incentive for players to pour money into the system and keep the developer afloat. When done wrong, they hold you for ransom by building addictions and forcing you to pay for them. Now that you know how developers push you into spending your money, you can better pick out the games you truly enjoy. And while there are plenty of unscrupulous and awful freemium designers out there, some developers truly want you to enjoy yourself. They just want some compensation for it.