Having read the CSM notes I left feeling a little disappointed at the lack of content regarding new customer acquisition. Why should we care? Well its not just a case that more players is more sand in the sandbox it’s also the case that more players means more money on CCPs side, money that with any modicum of common sense will result in more devs and more features for EVEs current players.
EVE is a social game, with us the players at its foundation. Instead of having a marketing team of a dozen people, why not make it thousands by outsourcing your marketing to the players as affiliates. Rewarding players with PLEX and game time is OK but why not reward the players with cash and support all of those awesome people who create content which drags in new players, as well as rewarding those who enhance other players by providing tools like killboard or fun stuff like Blink.
Gaming news websites are a potential source of new clients, especially those with a broad audience. Using tracking links and banners to advertise EVE could potentially bring in a lot of new customers, without requiring much setup time from CCP if using a pre existing affiliate management system such as Affiliate Window or Buy.At.
I’ve personally worked with UK based Affiliate Window and it never fails to bring in sales, it makes tracking really easy and is basic level admin work in effect. You have a single invoice to pay not 1000 small affiliate invoices, and you can also track your top affiliates contact them and help them develop their sales with you or encourage them to do so by providing them exclusive offers.
The current 5% that you can receive from ETC resellers really isn’t enough, and why is CCP letting the middleman make all of the money instead of its players who are providing awesome third party resources.
Lets take a look at some numbers:
Direct Subscription – £9.99 per month
PLEX Purchase – £29.99 for 2 PLEX
60 Day ETC Purchase – $34.99 – £23.50 (using PayPal)
5% commission from ETC Reseller site – £1.18
Guesstimated actual profit per ETC for reseller 15% – £3.53
It is not in line with the article but first things first; what the hell is CCP doing, how can I buy 2 PLEX cheaper externally than directly? cutting out the middleman is meant to be cheaper stop doing PLEX promotions and sort out your pricing strategy first!
We have our basics but we need a couple of other things to build a good affiliate program, something I know that CCP Games will have to hand too. The percentage of new customers that after paying their first months subscription continue onto a second month. The average life expectancy of a new customer. As I don’t have these numbers I will make them up lets say 20% and 6 months, I will also assume that CCP are losing about 20% of gross sales in various flavours of taxes I don’t know their tax arrangements so I’m purely pulling numbers out my ass here and creating a worse case scenario.
Now lets work with these numbers:
New customer pays £9.99
10 New customers pay £99.90
2 of these pays for 5 more months £99.90
Total revenue from 10 new customer acquisitions £199.80
Average revenue per new customer acquisition £19.98
Tax per new customer acquisition £4.00
Cost of goods sold £0.00 (Lets be honest CCP have capacity for additional players.)
Gross Profit per new customer acquisition £15.98
At this point there are a few directions CCP Games could at least consider having a three tier system:
1 – New customer acquisition 50% of initial subscription. This works out at £5.00 and the revised gross profit would be £10.98 per new customer. The percentages naturally change I expect the retention percentage to be lower but the average lifetime of a new EVE player to be longer, the idea generally is you can afford to break even on first transaction and build your business on repeat custom.
2 – New customer acquisition 75% of their first 3 months subscription but they must stay subbed the full three months, idea being you get players in and get the seller to keep them in game. This would suit groups such as GoonSwarm and Test and provide incentives for these groups to keep growing and keep players in game through providing engaging content. Lets say a player after their first 3 months of sticking with EVE is likely to stay with EVE for 18 months paying out £179.82 in total, then you can afford to pay the £22.48 to get that customer in the door.
3 – Current customer ETC sales provide 15% for ETC websites as they have the power to cross sell to other customers in their database and provide 10% through an affiliate scheme to everyone. That could be Blink, EN24, Battleclinic, Eve-Kill, large alliances and random gaming website – anyone. From high profile players to average Joes.
Also whilst we are at it lets fix your pricing:
1 – Make it so that ETC are location specific and accounts are location specific. So we have UK, US, Euro and Asia accounts with ETCs that are set to the regions. Want to buy a ETC for your UK account then you need a UK PLEX with UK pricing. Currently there will be a lot of people, like myself, that exploit this hole in the pricing system.
2 – Increase external prices for ETC sellers to +10% of your direct website PLEX sales, alternatively make it so that ETCs can not be converted to PLEX and that ETCs are +10% of the direct account subscription prices.
3 – Encourage PLEX purchasing by moving the pricing closer to subscription pricing even on small packages +50% is plain old silly and means you are pricing yourself out of the market. Its 21.6% cheaper for me to buy through an ETC seller and convert to PLEX.
And a couple of random suggestions:
1 – Advertise on Google Adwords for ‘Buy ISK’, ‘ISK Sellers’, ‘ISK seller brand name here’ etc and make a simple advert ‘Buy ISK without the ban from as little as £20’. You then achieve two thing you discourage ISK purchases by informing people as they go to buy they will get banned and you make money by informing them how to convert PLEX to ISK. The cost per sale here will be relatively low we’re probably talking around £0.70 per click I’d pull another number from my ass and guess about £3.50 per sale whilst honorably fighting the ISK seller scum.
2 – Make it easier to gift ETCs to players, I have RL EVE friends who I would buy PLEX for their birthday rather than give them a gift card. Also my family know I play EVE, a lot, and I would actually appreciate it over another HMV voucher… which I can’t even redeem anymore.
So what have we achieved in all of this? Well we have two major changes to EVE with a good affiliate scheme that rewards new customer acquisition and current player ETC sales separately for maximum gain for CCP. The first and obvious one is OMG every EVE player with influence can market on CCPs behalf, dragging potential new clients and helping to keep them from every dark un-EVE-educated corner of the interwebs. The second benefit is you are funding individuals who create EVE content that helps to retain current customers, killboards, news sites, guides, tools you name it EVE would be very different without these tools. More people will be interested in developing on CCPs behalf making EVE more engaging, Somer Blink is an excellent example I choose to pay £11.75 instead of £9.99 per months subscription just so I get 100mil Blink credit per account subbed to feed my addiction.
What is blatant to see is that CCP are underutilizing their players to make them more money, and its a shame to see happen. I would work my ass off to help EVE succeed especially if it meant more spare cash for myself and extra devs to finish all of the ship rebalancing by the end of 2013.
- Danny Centauri.