I’ve really enjoyed SimCity despite some of the features many would note as negative. The franchise is taking a serious new push into a heavily stylized system optimization kind of city builder which I don’t think is a bad move. While some of their operations and implementations of strategies have been poorly done, I was really impressed by a new initiative they have recently started – community engagement.
The concept here is basic – get users more involved with the community through organized challenges. There are a few reasons this is being done.
– Organized community initiatives draw users back to the game who previously felt little structure to the game
– Players feel further engaged with the franchise by watching what others are doing for the challenge and networking with others players. Gamers who play socially have a remarkably higher lifetime duration than those who don’t
– Players are going to get involved in the community through social platforms and forums to take part in the challenge therefore opening up more touch points with the franchise
An important side note to be aware of during this discussion. When observing the marketing perspective in a community there are 3 distinct objectives an initiative will fall under. Without going into too much detail as to what each are really about we’ll quickly cover them. Awareness is leveraging your current audience and community to gain further exposure to the market and new users. Conversion is specifically designed to upselling your current community with expansion installments, MTX discount promotions and cross product line conversions. Engagement is instead pushing your community to be more involved with the current franchise which would organically translate to a higher LTV (the difference between conversion and engagement is that conversion is an explicit attempt to upsell a customer where as engagement is creating the desire for the customer to stay involved with the franchise). Again, this is strictly talking about marketing purposes in respect to community management.
Back to SimCity
The objective is really smart for this franchise. SimCity has long made their intention known that they want to offer numerous expansions and microtransactions to current customers to acquire an increase LTV. This creates a relationship sell (longer lasting relationship with fewer customers but higher LTV) instead of a transactional relationship (many customers but lower LTV) which is smart given the fact that city building sims are somewhat niche in the gaming market place. Drawing the established unstructured community into organized challenges sets the foundation for a more consolidated approach to driving higher engagement. You might also notice that these initiatives started roughly around the time the first expansion pack was delivered. Likely a marketing analyst noticed the number of active players was dropping uncomfortably faster than desired and in order to maximize the sales of the expansion the community needed to be rallied.
Here’s the math behind an initiative like this. Mid 2013 EA revealed they have sold roughly 2 million units of SimCity. Following the fairly standard monthly active user percentage of a game in this category at this stage of product life , 35%, there are roughly 700,000 users. Normal conversion rates on expansion packs I’ve seen sway around 5% – 15%. With the bad press the franchise has received combined with the price of this unit, we’re going to assume 7.5% for this argument. At $30, EA makes roughly $1,575,000 for an expansion like this.
So what about this new initiative and how does it factor into the equation? Generally, an engagement initiative like this (done properly) will look something like this. Every touch point the franchise has with the customer will be used to communicate the challenge and draw users to be involved. This now includes users who are not active on a monthly basis!
We’ll make a few assumptions here based on what I’ve seen as fairly standard behavior.
– 3.5% of users signup for newsletter – 70,000 reach
– 25% of users engage socially, with growth hacking professional run social campaigns – 500,000 reach
– 10% of users engage through forums – 200,000 reach
With a duplicate relief of 75% we’re left with 577,500 users in reach of marketing. Reaching a user through any direct communication in the gaming vertical has a 21.6% CTR yielding 124,740. A conversion rate for an disengaged audience will generally be around 3% meaning roughly 3700 more units will be sold due to the engagement initiative creating $110,000 more revenue to be collected. Another way to state this is that by having solid engagement practices means a franchise can yield 107% of static revenue.
This involved quite a few concepts so if there is anything you want further clarified please let me know below!