1. F2P the Wrong Way: Age of Empires Online kperry@microsoft.com GDC 2013

2. Overview In this session, we will discuss the story of Age of Empires Online, an MMORTS that launched as an okay game but with a bad F2P business model. We’ll identify the problems with the initial model, detail the proper fixes, and then show how we applied them to a live game.  Business model and design changes  Population growth strategies  Results of all the above In this session, we will discuss the story of Age of Empires Online, an MMORTS that launched as an okay game but with a bad F2P business model. We’ll identify the problems with the initial model, detail the proper fixes, and then show how we applied them to a live game.  Business model and design changes  Population growth strategies  Results of all the above

3. The Beginning Age of Empires Online (AOEO) launched in August 2011. Why?

4. The Beginning Age of Empires Online (AOEO) launched in August 2011. AOEO launched with:  Insufficient Content and Missing Features  Causing Daily Active Users decline  Poor Business Model  Causing Revenues decline And therefore acquired:  Small Poorly Monetized Player Base AOEO launched with:  Insufficient Content and Missing Features  Causing Daily Active Users decline  Poor Business Model  Causing Revenues decline And therefore acquired:  Small Poorly Monetized Player Base

5. The Beginning Insufficient Content and Missing Features  Only two civilizations and one booster  Perceived as much less content than previous Age titles  Significant changes in design intent not understood by franchise fans  No skirmish mode  Very popular low time commitment mode  Does not depend on new content to drive repeat play  Level and gear-based PVP  Hated by competitive PVP core gamers who prefer pure skill-based matches  Small in number, but loud influencers  Slow Leveling Curve  Annoyed players  Forced repeat of already limited content Insufficient Content and Missing Features  Only two civilizations and one booster  Perceived as much less content than previous Age titles  Significant changes in design intent not understood by franchise fans  No skirmish mode  Very popular low time commitment mode  Does not depend on new content to drive repeat play  Level and gear-based PVP  Hated by competitive PVP core gamers who prefer pure skill-based matches  Small in number, but loud influencers  Slow Leveling Curve  Annoyed players  Forced repeat of already limited content NO SOFT LAUNCH FOR BRANDED GAME

6. The Beginning Poor Business Model  High Price Point  $20 per civ, $10 per booster  Required expensive minimum commitment  Capped Spending Opportunity  Max spend at launch: $50 ($75 with limited vanity items)  Revenue of F2P games dependent on players who spend more than others Poor Business Model  High Price Point  $20 per civ, $10 per booster  Required expensive minimum commitment  Capped Spending Opportunity  Max spend at launch: $50 ($75 with limited vanity items)  Revenue of F2P games dependent on players who spend more than others Biggest Problem

7. The Beginning In Summary:  We built the core of a good game.  But didn’t finish it before launch.  And built a business model predicated only on the sale of very expensive, slow to create content, set at a high price. All these things were fixable, but needed time. The game is live. All our fixes have to be done in the public eye. In Summary:  We built the core of a good game.  But didn’t finish it before launch.  And built a business model predicated only on the sale of very expensive, slow to create content, set at a high price. All these things were fixable, but needed time. The game is live. All our fixes have to be done in the public eye. Fixes begin December 2011 Fixes begin December 2011

8. The Fixes ProblemFixResults Limited Content No Skirmish Gear-based PVP Grindy Gameplay High Price Point Limited Spending Small Player Base

9. The Fixes ProblemFixResults Limited Content No Skirmish Gear-based PVP Grindy Gameplay High Price PointLower Price PointRevenue same; half price, twice sales Limited Spending Small Player Base Easy Probably a mistake

10. The Fixes ProblemFixResults Limited ContentTwo New CivsSales and DAU spike No SkirmishSkirmish ModeReleased free, positive reviews Gear-based PVPNew PVP ModeReleased free, positive reviews Grindy GameplayXP OverhaulReleased free, positive reviews High Price PointLower Price PointRevenue same; half price, twice sales Limited Spending Small Player Base Steam LaunchTripled DAU, revenue spike Community Overhaul Doubled base and engagement EasyMedium

11. The Fixes ProblemFixResults Limited ContentTwo New CivsSales and DAU spike No SkirmishSkirmish ModeReleased free, positive reviews Gear-based PVPNew PVP ModeReleased free, positive reviews Grindy GameplayXP OverhaulReleased free, positive reviews High Price PointLower Price PointRevenue same; half price, twice sales Limited Spending ECON OVERHAUL JUNE 2012 Small Player Base Steam LaunchTripled DAU, revenue spike Community Overhaul Doubled base and engagement EasyMediumHard Biggest opportunity

12. The Fixes The business model had to fundamentally change.  DAU is driven by major expensive content releases  We cannot create civs fast enough to sustain the business  Small but dedicated player base  Increasing monetization WITHOUT alienation The business model had to fundamentally change.  DAU is driven by major expensive content releases  We cannot create civs fast enough to sustain the business  Small but dedicated player base  Increasing monetization WITHOUT alienation Economy Overhaul in Summer Update: June 14 2012 Economy Overhaul in Summer Update: June 14 2012

13. Monetization Changes Before June 2012:  Limited PDLC  Purchasable through G4WL or Steam  Sharply limited amounts Before June 2012:  Limited PDLC  Purchasable through G4WL or Steam  Sharply limited amounts Max On Steam for $16 or $30

14. Monetization Changes After June 2012:  UNLIMITED purchases After June 2012:  UNLIMITED purchases No Max

15. Monetization Changes This was a much bigger change than just adding more items into the store. We moved the game onto an Internal Currency Model, where players purchase content with Empire Points. Empire Points are earned through normal play, or can be bought to speed progressions. This converted AOEO into a true free-to-play game, where players choose whether to spend time or money on content. This was a much bigger change than just adding more items into the store. We moved the game onto an Internal Currency Model, where players purchase content with Empire Points. Empire Points are earned through normal play, or can be bought to speed progressions. This converted AOEO into a true free-to-play game, where players choose whether to spend time or money on content.

16. Monetization Changes True Free-to-Play model gave us many wins.  Good press story, positive coverage (PC Gamer from 65 to 90)  Great community reaction, sparking additional word-of-mouth  A larger player base overall Using internal currency gave us a significant win as well.  Vastly simplified store operations  One set of currency offers per store  All other store changes handled in-game  Allows agility at the team level without Live/Steam dependencies True Free-to-Play model gave us many wins.  Good press story, positive coverage (PC Gamer from 65 to 90)  Great community reaction, sparking additional word-of-mouth  A larger player base overall Using internal currency gave us a significant win as well.  Vastly simplified store operations  One set of currency offers per store  All other store changes handled in-game  Allows agility at the team level without Live/Steam dependencies

17. Initial Results Summer Update went live on June 14, 2012. After the first month: Summer Update went live on June 14, 2012. After the first month:

18. Initial Sales First 5 weeks of new model = Previous 15 weeks of old model Same player base TRIPLE REVENUE

19. Internal Economy 55% bought ratio --- 3% surplus

20. Internal Economy 38% of EP purchases to categories that did not exist before

21. Design Changes Design changes were occurring along the way as well. We did not design to monetize. We designed to ENGAGE. Engaged players spend more time with the game. They then spend more money naturally. We did not design to force players to do things. We provided additional rewards to promote behavior that increased engagement.  Alliances to promote end-game engagements  Milestones to promote multiple civilization purchase  PVP focus features to promote PVP play  Feature-level conveniences to reduce annoyances  Empire Vault  But base given free Design changes were occurring along the way as well. We did not design to monetize. We designed to ENGAGE. Engaged players spend more time with the game. They then spend more money naturally. We did not design to force players to do things. We provided additional rewards to promote behavior that increased engagement.  Alliances to promote end-game engagements  Milestones to promote multiple civilization purchase  PVP focus features to promote PVP play  Feature-level conveniences to reduce annoyances  Empire Vault  But base given free

22. Overview Business model and design changes  Population growth strategies  Results of the above Business model and design changes  Population growth strategies  Results of the above

23. Population GROWTH Two complementary strategies to population management. Requires: Marketing Spend PR Traction Discoverability Requires: Marketing Spend PR Traction Discoverability Requires: Content Releases Polish and QoL Engagement Requires: Content Releases Polish and QoL Engagement MAINTENANCE Launch = HIGH Launch = Very Low After = ZERO Therefore…

24. Population 13% MAU rise on econ shift, but did not stay

25. Community In a Game as a Service, Community is as important as Operations. Without Community management, players do not come to or stay with the game. AOEO Community Management has taken an innovative approach to increasing engagement, as well as focusing on outreach to make up for the lack of marketing commitment. In a Game as a Service, Community is as important as Operations. Without Community management, players do not come to or stay with the game. AOEO Community Management has taken an innovative approach to increasing engagement, as well as focusing on outreach to make up for the lack of marketing commitment.

26. Community Why is all this important? A highly engaged community is much more monetizable. Since we have limited access to new customers (poor discoverability) and cannot communicate well with our current customers (GFWL policies), we must engage them with community tactics. This has a proven effect on revenue and DAU. Why is all this important? A highly engaged community is much more monetizable. Since we have limited access to new customers (poor discoverability) and cannot communicate well with our current customers (GFWL policies), we must engage them with community tactics. This has a proven effect on revenue and DAU.

27. Community Forums are an incredibly important tool for the AOEO Community. Due to GFWL privacy issues, we cannot directly email our customers. We generate key information in blogs and aggressively drive traffic back to the forums. Approximately 10% of the user base regularly uses the forums, which is 5-10% higher than industry standards. Facebook traffic was initially a result of people interested in AOEO. Now we use Facebook to drive people to AOEO.

28. After the Fix So we fixed the business model, revamped the design, and kept string community involvement. So what happened next? So we fixed the business model, revamped the design, and kept string community involvement. So what happened next?

29. Population New civ released. No effect on population. Sales, but no player spike.

30. The Most Important Slide New content didn’t move the needle. Not anymore. Existing players wanted deeper features and more expensive content, and the same content wouldn't bring new people. New content didn’t move the needle. Not anymore. Existing players wanted deeper features and more expensive content, and the same content wouldn't bring new people. BUSINESS MODEL PRODUCTION MODEL ! = The production model was unsupportable, no matter how good the business model. The content was too expensive to create. The production model was unsupportable, no matter how good the business model. The content was too expensive to create.

31. Population Population steady state.

32. Overview Business model and design changes Population growth strategies Results of the above Business model and design changes Population growth strategies Results of the above

33. Final Word We have known for a while that disastrous technical launches were recoverable (sometimes). We’ve also seen several games change business models entirely, with mixed results. Age of Empires Online proved that it is possible to pivot within a business model fluidly and while keeping the game open and alive. Keeping the players engaged is the key to any successful game as a service. You cannot be afraid to change if the outcome is better for the players. We have known for a while that disastrous technical launches were recoverable (sometimes). We’ve also seen several games change business models entirely, with mixed results. Age of Empires Online proved that it is possible to pivot within a business model fluidly and while keeping the game open and alive. Keeping the players engaged is the key to any successful game as a service. You cannot be afraid to change if the outcome is better for the players. kperry@microsoft.com