Category Archives: business

Ad conversion analytics

October 23, 2019 | Filed under: business

So…. In the complete and utter absence of any interest from curators, youtubers, the traditional press, or platform/store people to promote games these days… how is a struggling indie able to get any eyeballs on what they make? I guess its back to the wonderful world of adverts…

So I have been running facebook ads for AGES, and have loads of stats, and recently decided to break out excel and go through some stats on how advertising spend to promote production line stacks up against actually earning a profit. This stuff is extremely opaque, and because valve will not let devs have any kind of store page conversion tracking…we have to guess as to how our promotional efforts work :(

So I have a big spreadsheet that tracks the following things on a daily basis:

  • Ad spend on that game for that day
  • Raw steam revenue for that game (and its DLC) that day
  • Estimated net revenue after valves cut, chargebacks, returns etc
  • Profit for that day!

So if I look at a nice selection of 48 days (not during discount sales) data, I can plot these against each other and then analyze them in various ways to see whether I am doing something sensible or not. To do this I am just comparing columns of data using the excel CORRELATE() function, and the results are thus:

A raw correlation over those days of ad spend vs revenue gives this:

Simple ad spend vs revenue correlation: 0.50

Thats positive, which is yay! showing that I *am* actually driving revenue (not mere eyeballs, which is obviously working…) from my ads.

If I look at the correlation of ad revenue to profit I get:

Simple ad spend vs profit correlation: 0.39

which is weaker but still good, implying more ad spend == more profit. However, this is pretty useless as a metric, because the impact of an ad is likely not instantaneous. Someone sees an ad, follows a link, then thinks ‘gee! what an awesome game! (they are 1950s sitcom schoolkids), and then they add it to their wishlist to remind themselves to buy it the next day, or some such effect… so really I should look at pairs of day spending against pairs of days profit, to iron that out giving me this result:

rolling 2 day ad spend vs rolling 2 day profit: -0.32

Which is kind of wtf? If I go one steps further and average things over groups of 4 days I get this:

rolling 4 day ad spend vs rolling 4 days profit: 0.92

Hmmmm. This is a positive result, but actually I wonder if I’m actually doing it wrong. After all.. if there is not much variety between the ad spend on a given day, or profit on a single day, then how can I really draw conclusions. I probably need to go on a financial analytics course or do a lot of reading to understand this.

For example, if I do a correlation of a days ad spend, against the profit of that same day PLUS the 3 following days, I get a NEGATIVE correlation (only just) suggesting this is all bullshit :D

What I really need is some way to assess what the correlation is, and revenue really attributable to ads is… given the level of confidence I can get from the level of volatility in my ad budget... or what I imagine is called ‘volatility adjusted correlation’?

A bit of googling suggests this is called R squared, or ‘adjusted coefficient of determination) and on my rolling 4 day figure I get an RSQ of 0.84. I *think* this suggests that I can sensibly attribute 84% of the variation as being correlated, so effectively 84% of my profit each day is attributable to ads? Or is it that I can be 84% convinced that 92% of my profit is due to ads? In that case roughly 79% of my profits are ad-driven…?

No wonder most devs are confused by this stuff… I need to go back to school.

So we now have an official coming soon page for the new Production Line expansion pack (Design variety pack). Here it is in all its amazing html glory:

https://store.steampowered.com/app/1174730/Production_Line__Design_Variety_Pack/

Obviously the most exciting part of the page is the ‘add to wish-list’ button, which i thoroughly encourage people to do, as gossip among indie devs is that having high wish-list numbers converts into valve sending you nicer chocolate at Christmas, or something like that (I forget the details). Actually the best thing for me to do is probably embed the steam widget thingy:

I have no idea why there is a scrollbar on that widget. I think its safe to blame the mess that is wordpress…

Anyway at the moment the store page is not translated into each language but I’m getting that done now. All the actual content is done, and tested in game, and the new cars look lovely. Its purely cosmetic, so don’t yell at me if you can’t afford it for ruining game balance or whatever. I read that epics cosmetic DLC earns them a bazillion dollars and I’d like to retire eventually (ha!.. will never happen), so somewhere in that paragraph is my reasoning for adding content to the game…

On less business-y levels… I’m tracking down some ultra-rare but annoying Production Line bugs right now. One is a thing where very, very rarely, sounds stop streaming, or the music stops (after a good number of hours). I am digging into this, but its super hard to pin down.

Another bug is related to an error message in logs (which is now harmless…but bugs me) relating to shaders, and some visual artifacting. I discovered that the two different systems I was using to set and unset shaders may potentially have come into conflict, so I fixed that abominable code architecture by ensuring the game only has one possible system for turning shaders on and off, and hopefully now there can never be a conflict or a shader ‘stuck’ on. This will all be in the next patch, just before the DLC release.

Oh…and expect more Democracy 4 update goodness soon

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I know there have been surveys and studies in the past that show how many indie games on steam have sold a very small number (like under 10) of copies. Its no secret that many indie games are total flops. Its also no secret that the indie games market has skewed in recent years to be more hit-driven than in the past. There are a relatively small number of games making huge sales and a LOT of games making virtually no sales. I think that a lot of devs attitudes to this are somewhat fatalistic, and probably counter-productive and I want to explain why.

The general, subconscious ‘common-sense” supposedly rational mental model to how work equals success looks something like this:

But in actual fact, it seems to me that the real graph, in the real world is actually a lot more like this: (excuse my quick crappy hand drawn mess)

Which is something we are absolutely not used to dealing with, because we do not naturally encounter anything like an exponential curve in our primitive ape-like brains. here is a great article explaining just how ‘against common’ sense this is:

(Scroll down to ‘All of This Could Happen Soon‘ to see an amazing animation that shows just how much exponential curves totally fuck with our brains).

This should be intuitively obvious. Our primitive ancestors did not ever have to deal with exponentials. We hunt for an hour and find a single wild squirrel to kill and eat (my knowledge of primitive man is…sketchy). We hunt for 2 hours, we find and kill 2 squirrels. At no point did we ever hunt for 8 hours and then find/kill 32,600 squirrels. This is not in our experience. In fact, its not been in human experience, in the day-to-day sense, until EXTREMELY recently. Until the internet, we had ‘natural barriers’ to extreme success. To be popular as an entertainer in Michigan, you needed to live in Michigan, or have a sales team/rep in Michigan, or at the very least in the USA. Now anybody can make and sell anything anywhere. The total audience size for your product is probably a few BILLION people. Sell a $20 video game and you can potentially make $40 billion. Its extremely unlikely…but its POSSIBLE.

And even if you never achieve that, you have to accept the fact that other people are doing it. Fortnite and Minecraft are not selling to hundreds of thousands, but to hundreds of millions of people. NOBODY is safe from the financial and marketing reach that those games have. That includes you.

To put it another way: the natural result of global reach due to the internet, is that the big can get bigger, and bigger and they can and WILL compete with you. There is no local home-team advantage. There are no barriers. We are in the age of exponential entertainment. EVERYBODY knows about Game of Thrones, The Avengers Movies, Harry Potter et al…

So thats just fab…but how does that help a struggling, probably failing, probably bankrupt indie dev?

You have to learn to embrace and enjoy exponential growth.

In practical terms, what it means is that every improvement to your product yields an increasing relative improvement in sales. It also means that the very earliest upgrades and improvements to your product are the least rewarding, in comparative terms. When you check out the graph above you can see that if we make linear steps to the right along the X axis, each step yields a higher and higher boost in sales.

To put it yet another way, the first patch for your game will boost sales by a tiny, almost unnoticeable amount. The 99th patch for your game will double its sales. Yes really.

I am fully on-board with this mentality because my latest game (a car factory tycoon game called Production Line) is about bottlenecks. Like all factories, a factory in production line will move at the speed of the slowest link in the chain. The first few improvements to your line will maybe only raise production from maybe 1 car/hour to 2 cars an hour. The final ironing out of bottlenecks will take you from maybe 250-300 cars an hour.

Think about the effort required to improve fortnite by 1% in terms of content, quality, or presentation. Now think about how to improve your game by 1%. Its probably not a MASSIVE difference. Game engines and game design are very similar whether a game is a smash hit or an also-ran. But a 1% boost in your games sales will buy you a coffee, whereas a 1% boost in fortnite sales buys Belgium.

The problem is…people give up. They put in ALL THAT EFFORT to update their game with less bugs, more polish, more features, or a tweaked balance/difficulty/onboarding process and they earn an extra cup of coffee a month. WHY BOTHER? That is 100% the way most rational humans think. They then abandon the game, and start a new one from scratch, or leave the industry.

Do Not Do This

Read every article you can about compound interest. Then read about the chess rice wager, or simply watch this video to understand exponential growth:

And yes…its seems MAD doesn’t it? Like there is NO WAY that simply doubling something regularly so rapidly builds a pile of rice so high it stretches to the edge of the solar system. Those numbers MUST BE WRONG.

A bit like…. the sales figures of minecraft and fortnite.

So back to indie games… the point of the update that only has the impact of earning you a cup of coffee, is that the extra player (just one) per month builds a bit of momentum. The next update gets you another cup of coffee/month PLUS the extra 1/4 shot of coffee from a partial signal boost from the extra player and so on and so on… until every time you update the game you get a huge boost in the success and sales. This can take a while, and MOST people give up.

I am currently working on update 81 for production line. You can read the list of updates to the game on steam here: https://steamcommunity.com/app/591370/allnews/

Its a very, very long list. Its also enabled me to run a lot of steam visibility rounds on the game. I think the last one was number eight, and every time I run them, they are being shown to a bigger, and bigger audience, which helps grow the game even more because now we have more sales and thus more eyeballs and thus more sales and thus more…

The average indie gamer with mediocre or disappointing sales is at the 3rd or fourth square on the chess board. they have their 16 grains of rice, and they go take a job at facebook which pays them 64 grains of rice, which is obviously a better deal. Meanwhile Tim Sweeny and notch are sat on a pile of rice larger than Everest wondering why everybody else gave up so early.

TL;DR: The first post-release update for your game is the least effective in driving sales. This should be mathematically obvious, as its being delivered to he smallest ever number of customers. Giving up at that point is common sense AND totally and utterly wrong.

Democracy 4 Update

October 03, 2019 | Filed under: business | democracy 4

YES! We are working hard on this, although its been mostly under-the-hood tech and background stuff so I haven’t been updating people much on progress because there has not been *that much* we wanted to show yet, but that is going to be changing a lot real soon…

So, for those in the dark about this, Democracy 4 is the upcoming sequel to Democracy 3 (what a shock!) which is positech’s best selling game so far. Its a politics strategy game where you play the role of President/Prime Minister of a real world country and have to keep the economy in decent shape while staying popular enough to be re-elected, AND presumably helping change the country for the better (in your opinion :D).

For people who have never played the original games, the user-interface is unusual because its basically just a complex connecting web of icons. here is a screenshot from the main screen in Democracy 3:

And here is the current (work-in-progress) equivalent for Democracy 4:

Obviously the general style, fonts and so-on have all changed, but also we have moved the voter groups from the middle to the left. This gives us some interesting options, because this is now a list that can be (at the players discretion perhaps) sorted by popularity, or by membership, or any other metric. Or sorted alphabetically even, none of which were options in the old UI.

its really hard to see in a static screenshot, but the big under-the-hood changes for D4 are that its unicode from the very start (hello Russian and Chinese!), and also most of the UI is being done with vector-art rendering, meaning everything is pixel perfect regardless of screen resolution or zooming/scaling. For a game that is mostly UI, this makes a BIG difference. basically no more blurry UI elements anywhere :D. Its also cross platform from the start.

So far we are still at the ‘getting the core engine working right’ stage along with the ‘commission loads of art’ stage, so although a lot has been done, there is not a LOT that we want to show you in terms of new events, policies or situations yet. However, that will be coming soon. We already have a bunch of new ministers and voters…

Once we are putting in new simulation content, I’ll start doing regular blogs (probably video ones too) that detail the progress made on the game. I’d love to be able to tell you an exact date for us to go early-alpha (likely direct sales), Early-Access beta and final release, but I just cant be sure about those dates just yet. Obviously I’m well aware that 2020 is a US election year and we want to be coming out before the election :D Stay tuned for more updates etc, you can follow me on twitter, or join our mailing list (see sidebar) if you don’t want to miss anything.

Hi, I’m an indie game dev. I have been since the early days when we had to sell our games at a market stall on punched cards. Actually no, that was a JOKE but still…

I remember before the invention of the compact disc. I remember the fall of the Berlin Wall & nelson mandela being freed. I recall Ronald Reagan being elected president. My first car had one wing mirror and a manual choke. I went to see Metallica’s ‘master of puppets’ tour. I grew up during the cold war and recall Brezhnev as leader of the USSR. I remember TV with only three channels to choose from.

To put it another way…I’m 49 years old. I’m a proper Gen Xer. Not gen Y, or gen Z, or millennial. Gen X, the cool generation. What little hair I have left is about half grey. I read dead-tree newspapers at the weekend and proper books. I saw the original theatrical release of ‘star wars’.

Because I live in a village whose average community gathering looks like a Dark Crystal cosplay convention, I’m known as ‘that young man’, whereas in fact, not only am I ‘middle aged’ but as far as the indie development community is concerned I am…almost dead.

When I think of indie game devs my age or older… I mostly strike out. I know Jeff Vogel certainly looks around my age, but honestly who else? maybe Jeff Minter? was it it about indie devs called Jeff? The other UK-based indies I know of are all younger. yes even the slightly grey-haired Cas from puppygames or Jake ‘I don’t dye my hair yet’ birkett of grey alien games, both younger than me. Even ‘elder statesman indies ‘introversion‘ are all younger than me.

Now I get it…someone has to be the old timer, and I guess its me, and frankly I don’t give a fuck. Middle age is frankly awesome. You can go out for a meal without caring if your clothes are fashionable or if your ass looks too big or if anybody fancies you. Car insurance is trivial, and I bought my house when they cost about as much as a mouse mat. Oh I forgot…you don’t remember mouse mats do you?

..anyway…

I don’t CARE that *I* am old, but I do care that the age-range of indie devs seems to be…roughly 16-21 years old. I exaggerate for hilarious comic effect, but here is a random group of people. See if you can guess which one is NOT an indie game dev.

Hahaha, we old people are so funny. However, maybe this isn’t funny at all. Maybe in all the excitement and righteous identity politics crusading of the last decade or two about making sure indie game dev is ‘inclusive’ we forgot one group of people. One really big group of people. One really obvious group of people… older people.

(BTW dont go all angry on my ass about that pic. I used those 3 people because I know them, not because they are somehow indicative of anything other than being devs I know).

In theory, there should be OVER-representation of middle aged people in indie game dev. Think it through: We have WAY more development experience than you youngsters have. We likely already have experience of triple-A dev and have learned from their mistakes. Finance-wise, we are no longer paying off college debt. We bought our houses CHEAP and are not saving for a deposit for a house. We are likely married, and thus may be able to balance out the riskiness of starting a business with a 2nd income from a spouse…

Go a bit older, to my age and things may be even EASIER. Our kids have left home, the house is paid off, so is the car… and we have even MORE experience, both as coders/artists and as people who have seem gaming trends come and go. We have access to cheaper debt if we want a bank loan to fund our company. Hell..we may even GET a bank loan, unlike anyone with zero credit history. We have seen friends try and fail at running a business and can learn from their mistakes. We know a LOT of people in the industry….so…Where are all the 40+ indie game developers?

Mark Morris from uk indie devs ‘introversion’

Now I can immediately see a list of counter-arguments. We may be wary of ‘risking’ a stable home life with kids and a spouse depending on us. We may even have a pretty good job in the mainstream industry, and be relying on that for job security. We may have realized that gamedev is too risky and not as fulfilling as we once thought and now be working in the *much better paid* finance or web development industry. We may be burned out by overwork and want a quieter career…

But my own experience just doesn’t back this up. I could NOT switch careers now, from indie game dev at age 49, NOT because I’m too old to get a new job (I’m pretty qualified and very experienced now), but because nobody can afford to pay me enough to quit my indie game gig. To earn what I earn now, I’d probably have to get a job managing 20-50 people (or more) and it would involve the hassle of commuting, attending endless meetings and probably never typing another line of code…

…in other words, my current job is perfect for a 49 year old coder. Its frankly VERY well paid, its work-from home, so I can go walk the dog (I don’t have a dog), pop out for lunch (I do actually do this) and basically work when I feel like it. I can live somewhere remote in the countryside, and take holidays when I feel like it. Its bliss. Show me the stressed out financial software contractor commuting to central London to do a job he likely despises who does NOT instantly want to swap places with me. At age 49, this is great.

And yet at every indie gathering I attend, I’m the oldest. Why? It might be chance, but I cant help but think it might be a sort of unconscious prejudice. Lets be honest, when we imagine indie devs, we imagine someone in their early twenties with blue hair on a skateboard, an apple macbook covered in stickers with edgy slogans on it, and a latte in one hand and avocado toast in the other. Indie game dev is a young persons world.

2019 GDC indie party

Go to a party at GDC and you will find loud music, lots of alcohol and people excitedly yelling at each other. Later, if we are lucky, skrillex may play. yay? at the end of the evening we will celebrate the thirty under thirty. I expect to see twenty under twenty soon. Maybe a special event for pre-teen devs next year?

Indie development is COOL its FRESH its YOUNG! Its people all living together in the same house! its all game-jamming till 4am on a train! its loud music! its an obsession with ‘retro! (because to so many devs the 1980s feels like ancient history, known about only from fascinating documentaries).

This is worrying. We should NOT be gatekeeping indie game development to any small narrowly-defined group of people. The biggest irony about the game dev ‘community’ (actually a very cliquey set of people following each other on twitter) is that they INSIST that they are very very inclusive (and will be offended by any suggestion they are not), but in fact its really a club primarily of relatively well off western middle class twenty somethings.

If you want REAL indie development inclusivity , show me the people in their forties and fifties at your indie event. Hell, show me people over thirty. There is nothing magical about indie game development that means only young people can do it. Computer games are not THAT new.