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Sep 20, 2022

A Beginner’s Guide to User Acquisition for Game Developers

Gaming

Sanlo Team

Here’s a riddle for you: if a game doesn’t have any players, is it any fun?

As a developer, you’ve spent a lot of time fine-tuning your game’s mechanics, crafting an engaging storyline, designing your core game loop, building out characters, and making sure all the moving parts fit together for the ultimate goal of making an experience that’s fun and memorable.

But once the release date comes around, the focus changes from making sure the game is as good as it can be to making sure that there are enough players to actually enjoy it — and to generate revenue for your business.

User acquisition (UA), the process of gaining users for a game, app, software, or subscription service, is an essential part of growing a game and making it commercially viable. 

While there’s no set formula that you can use to get more users, there are some general models and strategies you can follow. Here, we’ll give you a quick overview of common UA channels, explain how you can measure the success of your efforts, and give you some tips that you can use to attract more players.

The two types of user acquisition

User acquisition falls into two broad categories: organic and paid.

Organic user acquisition refers to strategies that don’t utilize any paid ads or promotions. For example, an organic UA strategy might use content marketing, such as blog posts or YouTube videos to build interest in the game. One particularly important type of organic user acquisition is app store optimization (ASO), which is sort of like SEO for app stores — we’ll cover it in more detail later on.

Paid user acquisition includes any marketing techniques that require payment, such as paid ads on websites, TV, YouTube, Facebook, Instagram, or other social media platforms.

Of course, even organic marketing activities will typically involve some sort of cost (development cost to build and launch features that encourage virality or paying for video production costs or blog writers or streamers, for example), but the divide here is between marketing that requires direct and indirect payment and can be attributed to players it ends up bringing into the game.

Paid UA can bring the types of users you want to bring into the game through the right targeting and can do that more quickly, but it’s expensive and not always sustainable in the long term. Organic acquisition, on the other hand, tends to be slower to get started but compounds over time, so it’s generally a good idea to apply both methods simultaneously. 

Measuring UA: user acquisition KPIs

Before beginning any type of user acquisition campaign, it’s important to know how you’ll measure your success. Since the goal is an increased user base, it may seem like you can simply measure that in terms of installs (or downloads) and active users (daily, weekly, monthly).

And that’s true, to a point. But when it comes to modern games, things are a bit murkier.

In the past, if someone went to GameStop and bought a hard copy of your game, they were a user. Period. But in the current gaming landscape, where games are filled with purchasable content, there are many different shades of “user.”

In other words, you wouldn’t want to categorize someone who downloaded your free-to-play game and then let it sit untouched on their phone the same as you would someone who buys a new in-app item every week.

To account for that, it’s often more useful to look at KPIs (key performance indicators) that attach a price, time, or other value to your users. This is not an exhaustive list of KPIs, but is a solid list to get started with:

  • Lifetime Value (LTV): The total value that the average user brings over the entire time that they use your game. There are multiple ways to calculate LTV. However, in a nutshell, it requires for you to know the average purchase value multiplied by the average number of purchases over the course of a player’s lifespan with the game (how long they stay active). 

  • Cost Per Install (CPI): The cost of ad spend over a period of time divided by the number of installs during that same time period. This gives insight into how well your strategies are getting people interested in your game in the first place, but doesn’t indicate engagement. When your LTV is greater than your CPI, it is a good indicator that you are running a profitable marketing campaign.

  • Return on Advertising Spend (ROAS): ROAS tells you what return you get on UA spend. For example, if you spend $100 today to acquire 1000 players, and in 12 months, that cohort of players ends up generating $120 for the game, then your ROAS for 12 months is 120%. You should know your major milestones and targets for this KPI, such as 3-month, 6-month, and 12-month ROAS.

  • Payback: It’s a different way of looking at ROAS, and basically means how long it takes to recoup the full amount spent on advertising. For example, if you spend $100 today to acquire 1000 players, and it takes 3 months to collect $100 from that cohort of players, then the payback is 3 months. Paybacks are important so you know when you get UA spend returned and when you can “recycle” it back into the game (or other games) to reinvest.  

  • Retention Rate: The percentage of people that actively continue using an app or playing a game. Typical time frames are day 1, day 7, day 30, day 90 and day 180. To take day 7 retention as an example - that means out of the cohort of users that installed and started playing a game on the same day, how many of them returned to the game on the 7th day since install. Different durations shed light on important aspect of the game - for example, day 1 retention is a good indicator of how good and engaging your onboarding and first player experience is, whereas day 90 retention is a good indicator whether there is enough content and/or re-engagement features for players to come back even 3 months after they installed the game. 

  • Average Revenue per User (ARPU): ARPU is a holy grail metric of monetization and is a strong indicator of how healthy and sustainable are monetization mechanisms of a game. This means revenue generated divided by the total number of users over a specific time frame (weekly ARPU, monthly ARPU, lifetime ARPU, etc.). As a side note, some companies prefer to track ARPDAU, which is an average revenue per daily active user (daily ARPU).

Each of these KPIs tells you more than just a simple absolute number of installs can — they give insight not only into how popular your game is, but how effective your marketing campaigns are in terms of cost efficiency and engagement.

Tips for improving user acquisition

Although there are no hard and fast rules to follow when it comes to UA, here are some tips that can help you along the way. 

Use paid and organic channels in tandem

It’s generally considered best practice to combine both organic and paid UA channels so that you attack the problem from multiple angles.

Organic user acquisition often takes longer to see returns, so it can be fruitful to consistently build out an organic UA strategy while driving more immediate results with paid ads.

You can also think of organic UA as ensuring that your online presence is large enough that people can easily find your game — especially after seeing an ad. When running paid campaigns, many potential users will see your ad, skip it, and then for your game later. You can use organic UA to make sure that when they go looking for you, they actually find you. 

Utilize App Store Optimization (ASO)

ASO is essentially search engine optimization (SEO) for app stores. It’s the process of making sure that the app store listing for your game is strategically filled out to appeal to potential users and to be easily findable when searching the app store.

That means ensuring that your app store listing is visually appealing with screenshots, videos, and uses current design trends, but also includes keywords that potential users might be searching for.

For example, if you developed a sci-fi puzzle game, you’ll likely want to include that as a keyword somewhere in the listing. That way, people who have never heard of your game can find it while browsing, and people who saw your ad but forgot the name of your game will have a better chance of finding it again. 

Know who you’re marketing to

One of the most fundamental parts of any marketing strategy is understanding your ideal customer profile or buyer persona, an imaginary person that represents the market you’re trying to capture.

For example, Facebook found that nearly 75% of mobile matching & word/brain/board puzzle game players in the US were female and more than 60% were over 35 in 2020. So, if you were developing that sort of puzzle game that year, your ideal customer profile would likely have been a female over 35. From there, you can start to fill out more details, such as location, device type, etc.

Be nimble

User acquisition is not a “set it and forget it” endeavor. You’ll want to observe major demographic splits, such as iOS vs. Android across major geographic regions and see how their KPIs are performing. You’ll want to stop poor performing segments and increase budget on high performing segments.

Experiment

Try several strategies and see what works best for you. Test different creatives and designs for your ads. Try different types of ad formats such as cross-promotions with similar games, playable ads, and video ads. It’s important to not make any assumptions and experiment, and let the metrics guide you.

Get financing to boost user acquisition

In many cases, indie game developers don’t have the funds to continuously run successful paid UA campaigns. Without that financial backing, great games can stagnate and lose momentum due to a lack of growth in the number of engaged players.

To bolster their UA efforts, developers often seek out financial support in the form of loans, investments, or game publishing deals. However, these traditional options may require developers to commit to inflexible repayment schedules or give up some of their creative and financial control. It’s important to either have internal resources to efficiently “recycle” or reinvest returns from previous UA campaigns or access financing that can be accessible on a short notice and have paybacks that are in sync with paybacks for the UA campaigns - or some combination of these.

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About Sanlo: Sanlo’s non-dilutive financing plans can help fledgling developers get a foothold in the market. Take a look at how we helped StarBerry grow to over 3 million downloads in less than a year with non-dilutive capital: https://www.sanlo.io/blog/case-study-starberry

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We offer fast, flexible financing for game developers so you can grow on your own terms. Try Sanlo now and get funded within 72 hours.

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Copyright © 2022 Sanlo
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Financing for game developers, by game developers.
Contact
Questions? Drop us a line👇
Copyright © 2022 Sanlo
Made with ❤️ across the Globe
Financing for game developers, by game developers.
Contact
Questions? Drop us a line👇
Copyright © 2022 Sanlo
Made with ❤️ across the Globe