Timo Riikonen

There may be someone in the team who says that they should use same metrics as what management board uses as if their game is killed, what is the point? That is understandable statement, but it means that they get overly attached with the games they do. And roles of management and for development teams are and should not be the same. Basically management team gives the budget and then it is task for development team to utilize that budget in the most useful manner. So they should not focus on preventing that their game gets killed. Getting the axe, typically does not mean shutting it down, but putting it to basic maintenance only. Instead they should focus on making it the most interesting and the most profitable, so that due to these reasons it will happen as late as possible. So although development teams may have more-or-less competition with other teams, they should not focus on this competition, but they should focus on what is good for the company and hope that it will suffice in possible team and game competition.

1.     Retention rate + return rate (metrics)

Basic underlying mechanics have not disappeared: make a game that people like to play and you will get many players and you will get profits as well. So the most important point is in making a good game and when you talk with analysts, they call that as retention rate. And use a comparison point to see where you are doing well already and where you should focus to. Flurry is one of the options as a comparison point. But if you use Flurry make sure you use correct number from it and not the one you may want to show to venture capitalists.

As Eric Benjamin Seufert has stated, you should not attempt normally to calculate retention for each major change. Instead accept the fuzziness that you can’t calculate everything in precise manner as calculations are not a goal by themselves, but only one of several tools to make a good product.

So developers should focus on retention rate, but give some leeway to those that will work on return rate as well. Such as marketing manager who wants to send a campaign to players who have quit already. Thus this value has return rate added to it as well, at least if the campaign is a permanent one.

2.     Lifetime value (metrics & estimation)

We wanted to show profit to management, but still we want to focus on revenue with the development team. Why is that?

So simplified Profits = revenue – maintenance – development – marketing. Development team won’t focus on marketing. They do focus on how much added benefit you gain for your development efforts, so they focus on how much they can create in spring cycle. But here the development means development expenses and besides asking for a raise every now and then, they should not focus on that either. They can think maintenance expenses, but they should never focus on that. It should be enough to have one person in the gaming company to check which games use more money on maintenance / active player than other games and then to notify about that to corresponding teams. If they don’t get this notification, teams should focus their attention to elsewhere.

So in other words the only point in profit that development teams should focus on is making revenue.

Now it doesn’t matter if the revenue is generated by whales, dolphins or minnows as long as you get it from somewhere. But if you are lacking with revenue generation ideas, you could focus on each of these groups separately and gain better insight through that. I am not sure if you should follow these categories separately though: again the focus is in generating revenue; it is up to you to decide what methods give you best results with that.

Other much more dangerous metric is calculating revenue / player or $/DAU. This number can be more useful than revenue as a bulk, but the cavity is in that having fewer free players increases this number and that naturally contradicts with your targets very much. So revenue as a bulk is a safer metrics to follow.

But the best metrics for revenue isn’t revenue itself (metrics), but instead lifetime value (LTV) that is metrics combined with estimations. It is easier and faster to change LTV value and naturally it is better to measure something you can affect on easier if it serves the same end goal.

3.     New users and buzz factors

It can be very hard for development team to create buzz on their product and someone might say that it is impossible to do that. But there are a few methods how it can be done and even when team is not directly responsible for all of the actions that can be done, they can at least give suggestions and support for those actions.

I am partly cheating here telling you about three factors to follow and focus on, but partly not: it is best to follow these two numbers together. In theory you should get buzz first and then you will get new users, but your numbers will show if this is true or not. And that will also tell you how effective mechanism buzz creation is or is not. And thus you will know if you should give interviews to create buzz or if you should focus on creating a good product and get the players through that.

So buzz factor is calculated from internet: how well the game has been ranked in game store and by rankers, how often it is googled, etc. It may take some time on finding a best way to represent “buzz” that is some of all or selected values from the full list.

There are several options on how to measure new users metrics:

• Reuse same calculation as what is used for management board.

There are two options how you can show k factor:

• Active on day 7 with marketing removed or

• Active on day 7 with marketing removed / total customer base (k factor)

 If you able to calculate k-factor: how many other players new players bring in, that might be useful. Most likely this factor would be more assumptions than measured metrics, so I do not expect it to help you.

For a single game at least in theory it is better to calculate sum of their activity: how many levels they have advanced during the day and how much experience they have gained during the day. Note that you need both of this metrics as first one if high for new users and second one is high for old users. But this value is not comparable between games and therefore this is not the primary metrics to follow on board level.