2012/11/08

Online Marketing Lies

Online companies need proper b2b marketing. But they tend to confuse people who don't know a lot about the online games industry. Lets look at a recent example:

Innogames celebrates 100 million users and a revenue of 50 million this year (German link)

So investors are astonished. Wow. 100 million players. (Note: I like Innogames, I only use them as an example. Bigpoint does the same 'propaganda' thing)

No, no. Its registrations. LIFETIME registrations. And as Innogames has been founded in 2007 it means they collected 100 million registrations over the period of 5 years, resembling an average registration count of 2700 per day 54.000 per day (just one user noticed my calculation error? Shame on you!) Now that doesn't seem as much anymore is a lot. (calculation assumes linear reg numbers which of course is wrong, I simply use it to make a point).

This number only tells you one thing: their marketing is pretty good. That's all. It does NOT mean:

- they have 100 million players
- they have millions of players in one game anyways.

So lets look at the second number: 50 million revenue. That is very good. As they have 3 major games (Tribal Wars, Grepolis, Forge of Empires) you can basically assume most of the revenue is done by those games (neglecting their other games like The West etc.).

Grepolis is by far their largest, Tribal Wars WAS their largest and first success, Forge of Empires is their latest success. So we can roughly assume a revenue distribution of 3:2:1. Lets add 1 for the smaller games, i.e. 7 parts:

5 Million / 7 = 7.142 Million a share, or:

Grepolis: 21 million - or 1.75 million per month
Tribal Wars: 14 million - or 1.16 million per month
Forge of Empires: 7 Million - or 1 million per month (it was launched later)

Notes: Tribal Wars and FoE might be switched, depends how Tribal Wars suffered from the Grepolis launch. From my info it didn't suffer at all.

Now close to 2 million revenue a month per game is nothing special in the f2p space considering you operate world wide. Operating three good f2p games and making 4-5 Million per month is good. But its not perfect. There are iOS f2p games making 3x as much per month.

So I hope I put some of these numbers into perspective. Again, don't get me wrong. I like Innogames, I don't criticize them, I use them as an example. I just criticize the propaganda around f2p numbers.

1 comment:

  1. Teut, you're absolutely right. 50 million in annual revenue isn't much, particularly over a large suite of games. And 5 years of registrations is a long time to accumulate them. Look how far League of Legends has come, and how quickly, and their annual revenue must be much, much higher than Innogames'.

    For World of Tanks, our only F2P online game (at the moment), we have reached over 40 million registrations in just 2 years, but I can tell you we're making a heck of a lot more money than Innogames for sure!

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