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Monetization in Video Games: The Pros and Cons of Different Models

Video games have come a long way from the days of simple arcade games that you play for a few minutes before putting more coins in. Today, video games are multi-billion dollar industries, with games for all platforms ranging from mobile devices to consoles and personal computers. Monetizing these games has become an important aspect for game developers and publishers, and there are several models that they can choose from.

While there are many different approaches, one of the most common is in-game purchasing. Some games allow you to buy special outfits, weapons, and other items with real cash. Others offer you virtual currency that you can use to purchase in-game content. You can find this type of monetization in most major video games.

  1. One-time purchase model: This model is the traditional way of monetizing video games. Players pay a one-time fee to purchase the game and can play it without any additional costs. The advantage of this model is that players know exactly what they are paying for and do not have to worry about hidden costs. However, the disadvantage is that players may not be willing to pay a high fee for a game that they are unsure about.
  2. Subscription model: Under this model, players pay a monthly or annual fee to access the game. This model is popular among massively multiplayer online (MMO) games and is a great way to generate recurring revenue. However, players may be less likely to subscribe to a game if they feel like they are not getting their money’s worth. Examples of popular subscription based games include Blizzard’s World of Warcraft, but most early massively multiplayer games adopted the model also before transitioning to a Free-to-play model as subscriber count declined.
  3. Free-to-play with microtransactions: This model is becoming increasingly popular, especially with mobile games. The game is free to download and play, but players can pay for in-game items or upgrades using microtransactions. The advantage of this model is that it removes the barrier to entry and allows players to try the game before committing to a purchase. However, some microtransactions can be predatory and overpriced, leading to players feeling like they have to spend money to progress in the game. Most mobile games use this model or advertising-based monetization, but many recent games like Genshin Impact use the model on other platforms also.
  4. Advertising-based monetization: This model involves displaying ads in the game, either interstitial adverts in between levels or as in-game banners. The advantage of this model is that it provides a revenue stream for game developers without requiring players to pay anything. However, ads can be intrusive and take away from the player’s experience. In more immersive games this can be a big factor, but I would not generally consider this an issue in casual games unless you’re spamming adverts and annoying the player.
  5. Downloadable Content (DLC) and Expansion Packs: DLCs are additional content that can be downloaded and added to the base game, while expansion packs are larger additions to the base game that often include new features and storylines. DLCs can range from cosmetic items to new maps and characters. The advantage of DLCs is that they allow players to continue to enjoy the game and add new content without having to purchase a new game. However, DLCs can also be overpriced and feel like a cash grab for developers and publishers.
  6. Preorders, Preorder Bonuses: Preordering a game allows players to purchase the game before its official release. Preorder bonuses often include in-game cosmetic items, such as weapons and costumes, but can also include early access to the game. The “advantage” of preordering is that players get access to the game early and can enjoy the bonuses. However, preordering can often dramatically increase the cost of the game and the bonuses may only be a few cosmetic items. Preordering the game also often reduces your possibility for a refund and there is no guarantee that you will get the game you paid for (*cough* Cyberpunk 2077, Anthem…).

Taking the time to learn more about monetization is the right move. The right strategies can make your game more successful. Whether you are developing a console or mobile game, the key is to create an economy that rewards your audience for their loyalty.

The best way to do this is by structuring an ecosystem around your game. Doing so can improve the overall economy of your game while increasing the capital available to you. By doing so, you can better manage your economy and ensure that your game stays relevant over the long term.

In conclusion, there are many different ways that video games can be monetized, each with their own advantages and disadvantages. The rise of mobile gaming has caused the industry to move towards the free-to-play with microtransactions model. However, it is important to note that some microtransactions can be predatory. Developers and publishers should strive to strike a balance between monetizing their games and ensuring that players have a positive experience. As the gaming industry continues to expand, companies have to figure out ways to monetize their products while maintaining a quality user experience.

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