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Dude, Where's My Money? Or “Divvying up the Loot” (part 2)

by Nikolay Bondarenko on 08/29/18 10:18:00 am   Featured Blogs

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The following blog post, unless otherwise noted, was written by a member of Gamasutra’s community.
The thoughts and opinions expressed are those of the writer and not Gamasutra or its parent company.

 

This is the second of six articles dedicated to an overview of the entire process of publishing a PC game, from start to finish. The first article dealt with pricing, discounts, and the Steam wishlist. Now we’re going to discuss the role of good Steam page design, dedicated community engagement, regional restrictions, third party distribution, distributors, and alternative open platform options.

We won’t be needing calculators this time. Instead of boring diagrams, you’ll see lots of funny GIFs.

Design, Groups, and Curators on Steam

There’s another tool you might want to use that’s just as important as the wishlist: The Steam group. Groups can be a vital way to attract an audience quickly, within the first few days after launching your game. Based on my own experience, anywhere from a quarter to half of the users who are signed up for your Steam group on release day will buy your game within a week. To put it simply, these people are your most dedicated audience.

Whatever you do, don’t treat your group as an afterthought. Keep talking about the development process. Show your work in progress, including videos and GIFs. Ask for members’ opinions and actually listen to them (within reason). After launch, keep releasing clear and detailed patch notes and announce your patches when they drop. Keep your audience up to date on what you’re doing or planning to do.

Steam allows you to see all group members who are currently playing your game. Very simple scripting also makes it possible to cross-reference the group memberships of any two games on Steam.

Having lots of impressions and being featured isn’t everything — you have to make sure those views convert into page hits and, subsequently, sales or wishlist adds. Having a lot of views won’t do you any good if they don’t efficiently convert into sales.

Steam doesn’t offer much in terms of statistics, and what it does offer is often inconvenient to work with. However, pay attention to the click-thru rate (conversion into page hits) — this statistic is crucial for your promotional efforts.

  • Make sure that the first entry on your Steam page is a trailer with a strong focus on gameplay. This greatly affects conversion into sales — and especially into wishlist adds.
  • Try not to have too much text. Focus on placing a few attractive GIFs at the top of the page.
  • If your game has been reviewed by the games press, definitely make use of the “Reviews” section of your page.
  • Pay attention not only to the key art on your homepage or the game’s page, but to smaller thumbnails as well. These are the images that will be displayed on curator pages and in the “Updates” section (view cycles). They affect the efficiency of conversion to your page, and therefore your sales.

Publish your page as early in the development process as possible. This will give you more time to attract an audience for wishlist adds and allow you to test a wide array of designs for your page and key art.

Experiment with key art, icons, and design. A/B testing for involvement on Facebook can be a simple and effective measure prior to launching your game.

Curator communication tools on Steam are pretty weird. You can only send out 100 applications, and if you fail to withdraw applications ignored by curators in time, you’ll just waste them. If you don’t know a curator yet, make sure to leave them a message explaining the kind of game you’re making and why they ought to tell their audience about it. And ask them to get back to you if they decide not to review it.

Don’t ignore curators. Start getting to know them and try to come to an agreement with them regarding reviews 2–3 months in advance. Don’t be afraid to pester major curators. Contact them often, and be persistent.

My own experience involved contacting and negotiating with over 400 curators, and over 80 of them ended up giving us reviews or recommendations. This brought us 5.161 million views and 189,587 page hits within the first two months after launch.

Regional Restrictions

You probably already know about G2A, Kinguin, Gamivo, and other key resellers. And you definitely wouldn’t want your game to be sold there at a huge discount — at least not until you start selling it in bundles.

The biggest mistake you can make is to request global keys that are eligible for activation anywhere in the world, then sell them at regional prices. If your game sells for $8 in Russia, what’s to stop someone from buying an $8 key in Russia and selling it on Kinguin for $12? It’s a simple business model.

To avoid this, you’ll have to deal with regional restrictions on the launch or activation of your keys prior to release. By default, you can’t make packages with regional restrictions on Steam.

You’ll have to contact Steam Support in advance, explain your needs, and request additional regional packages, at least for the Commonwealth of Independent States, China, and Latin America.

Keep in mind that many stores use regional prices, and third-party distributors can use currencies other than the US dollar. This means that you’re going to have to distribute keys with regional restrictions to each of these stores.

There are two types of restriction on Steam keys: restriction on activation and restriction on launch. You’ll need both. Among enterprising Chinese resellers the most typical “hack” is to buy keys that are only restricted in terms of activation at a low regional price (in Russia, for example). Just change the IP address using a VPN or proxy, and voila — the key is activated. Now you can go back to your original IP and play without any restrictions. With the launch restriction activated the player will need a VPN or proxy connection every time they want to play.

Whatever you do, your keys are going to show up on these marketplaces one way or another. There just isn’t all that much you can do about it. Key resellers are a highly autonomous group with strong connections to regional stores.

Third-Party Distribution

There are a huge number of stores and platforms in the PC game distribution market (join the effort to complete the list, by the way). Several dozen of them are quite large, and you’re going to have to work with them either directly or through your publisher or distributor.

Most distribution is handled via Steam keys. If you take the entire third-party market for PC games, expect to earn 90–95% of your revenue from Steam, and only the remaining 5–10% from other platforms.

If you’re very lucky, if your game is really good, if you’re a marketing god, or if you know a couple of magic tricks, this portion could be higher. However, it’s very unlikely to ever be more than 15–20%.

When you sell through third-party stores, you also share your profits with them. The split is usually 70/30, sometimes 60/40. The difference is that Steam doesn’t get a cut. You bring people to Steam, and they install your game on Steam, but the profit is only shared between you and the store.

It’s worth noting that you request your Steam keys in advance, but you only get paid once they’re sold by the third-party stores. Meanwhile, Steam can refuse to generate keys for you without providing a reason — and they actually do it sometimes.

From time to time third-party stores will use their share of the profits to introduce exclusive discounts. Rather than collecting their 30% cut, they might only take 20% and “invest” 10% as a “super-discount” for a game that does well on their store. Everybody wins — you get sales, and the store increases its audience and income.

Remember the pay gap? All third-party stores work differently. Some transfer your earnings monthly, while others do it quarterly. The large ones such as Humble Bundle allow you to set a minimum amount of funds to withdraw on your own. A number of stores require you to pay an additional banking fee if you try to withdraw less than $1,000.

The guys above have just found out that the vast majority of third-party stores have no marketing plan whatsoever. They never plan more than one to three months ahead — at best. Keep in touch with all the stores. Ask them about the new activities they plan to roll out and whether you might be able to participate in them. The more stores you’re engaged with, the more managers you need to stay in contact with. Every month.

Discounts and sales are the driving force behind third-party distribution, and you need to consider the unique features of each of your partners. For example, Indiegala has its own unique “Crackerjack” format where your game gets a page of its own for several days. The store also advertises it using a large mailing list and announcements on various social networks. The main condition is that the discount needs to be around 10% below the lowest discount you’ve given thus far. You have to take this seriously — if you ever drop a 30% discount anywhere, your only chance to participate in a sale like this would be to offer a 40% discount, or even higher.

If you know your game is highly anticipated or if it sells well, don’t hesitate. Say that you’re ready to make some exclusive offers in order to get your game featured. It works. Everyone’s used to it, and it’s a common practice in the industry.

A large number of platforms (maybe all of them even) are always clamoring to be the first to feature the biggest discounts. If you want your game to be featured, you’re going to end up giving bigger and bigger discounts. That’s just the way it works.

Distributors

This’s a certain class of companies whose business is closely tied to third-party distribution. Their job is to make your life easier by connecting you to dozens, or even hundreds, of stores large and small all over the world. You sign a single agreement with the distributor, and they do all the dirty work. This includes signing contracts, distributing keys, collecting money, managing discounts, providing reports, and sometimes even translating marketing materials.

It’s a very simple process: you sign an agreement in which you offer the distributor slightly more favorable terms compared to Steam (65/35 versus 70/30, for example). By the same token, the distributor and the store split their profits 75/25 rather than 70/30. The difference in the split is where the distributor rakes in its profits.

Most of the large distributors I know split their profits 70/30, but different arrangements tend to be typical for smaller companies.

Then there’s payment speed to consider. A distributor can make your life easier as a developer, since they handle large portfolios of games and usually get paid more often. Sometimes large distributors have their own systems for analytics and key management that are integrated by the stores at the end of the chain. This allows for better oversight of the sales process.

Open Platforms

Getting on GOG is in many ways identical to Steam — the most difficult part is getting past the platform’s internal review process. If your game suits them, you’re greenlit. The difference with Steam is that you’ll get no guaranteed traffic whatsoever.

You can negotiate featuring with your manager at GOG. Outside of featuring, the organic traffic is almost nil. Just as with Steam, the lifecycle is all about discount sales: Summer Sales, Winter Sales, genre-based sales, or sales arranged individually with managers. Unlike Steam, however, GOG managers are usually very helpful. They’re responsive and eager to negotiate promotions and discounts with (you can’t change the price of your game on your own on GOG).

Itch.io is the de facto standard platform for small indie devs. It has about 10 million unique users, almost all of whom are in the US. The platform operates at an open rate: you can give them anywhere from 0% to 30%. The recommended rate is 10%.

I know plenty of people who sell stuff on Itch, and their average annual earnings range from $400 to $1,200.

The platform is highly democratic and chaotic. In order to get your game featured you need to get in touch with the platform’s creator or one of his two colleagues. If they like you, you get put on the homepage, front and center, which will guarantee you some views. The average price for a game is $5–10. Many games are free or sold on a pay-what-you-want basis. Take a look at their statistics for 2017 if you want more insight into the success stories on the platform. I’d like to make special mention of their publishing tools: everything from setting up your page to uploading your game is surprisingly convenient, clear-cut, and simple.

GameJolt is Itch’s twin and operates in a very similar way. Its most recent statistics are from 2016. Most of the platform’s audience comes from Latin America and the US, and it’s half the size of Itch’s audience. All else being equal, I suggest ignoring this platform and not wasting your time on it.

Then there’s a group of platforms such as Utomik, Hatch, Jump, and PlayKey that are trying to become the “Netflix of games.” These platforms operate on a subscription basis. This can entail either paying for time spent in-game or buying a traditional monthly subscription to the entire catalog.

You might want to read Brendan Sinclair’s article ”Netflix of Games” a threat to developers. At this point in time, in the year 2018, I’m inclined to agree with the skepticism of both the author and the developers who have joined these platforms.

Up and coming stars include Kartridge from Kongregate, Discord, Shard from Fig, The Abyss from Destiny Games, Robot Cache from Brian Fargo, and KorroBox from guys who used to work at Riot Games, Blizzard, Twitch, and Gung Ho. And a dozen more are about to be launched in 2018 and 2019. At least two of these — Kartridge and Discord — look very promising.

Keep in mind that there are some technically closed platforms with very large audiences that might open up under certain conditions. One example is Ubisoft’s Uplay, which sells some games that are neither owned nor published by Ubisoft.

File this one under “for what it’s worth”: Origin (EA) is preparing to open its doors to third-party products. I’ve heard about this from two different projects currently in development (B and AA), both of which were in talks with EA in early July of this year. If you’ve got any further information about this, please get in touch.

EPIC plans to create its own game platform. Rumor has it that there will be no royalties for games that run on Unreal Engine (the fee for using the engine remains the same); other games will pay a royalty of 12%.

What lies ahead


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