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Money in Social Casino Gaming

May 2 admin

Is there money to be made in the Social Casino Gaming space?

There is always money to be made in every industry, but the real question is… how does one make money in the social casino gaming space?

I just booked for my first ever Social Casino Gaming Summit for June 19-20 at the Bellagio in Las Vegas. It’s great timing, because 1) Im always there around that time for WSOP so it will give me a nice break from the tables. 2) Our Lucky Lady Slots game minimum viable product is ‘done’.

I wasn’t planning on doing any social gaming conferences/events but with our current pivot, it seems that networking and strategy is the most logical next steps. I don’t know how useful it will be, but I am really interested in all the topics they cover including: Forecasts for growth, VCs investment tips, social casino space, The casino operator- game developer partnership, Working with casino operators, The casino operators view, Working with Facebook, Maintaining retention rates, Enhancing your brand through social casino games, The emergence of social casino games on mobile devices, Social casino games in new markets- untapped potential, Mobile social casino gaming and how it differs to traditional social casino gaming and more.

I will be posting regular updates for sure on my Twitter so be sure to follow us there!

Lucky Lady Games, Social Casino Gaming Developer latest pivot

Instead of launching and trying to compete in the Facebook space with our HTML5 casino and throw thousands of dollars into marketing to compete with every other social casino, we have decided to step back and take a good realistic look at our options. We are excited with the ideas we came up but I will save these new nuggets for future posts.

Right now let’s talk about this info graphic posted by the Social Casino Gaming Summit:

Social Casino Gaming Industry Revenue Estimates

People get so excited when they see social casino industry numbers as shown in the above graphic. But do you really know what these numbers mean? Im not just saying know the acronyms MAU or ARPMAU, Im talking about actual business.

My quick analysis of this Social Casino Gaming Industry Revenue Estimates graphic:

  • Out of the 100s of Casino game type apps, these are numbers from the creme de la creme. (Remember that the top 10% of any industry always makes money…  the question still remains how do you get there?)
  • These numbers are gross revenues and does not include things such as  marketing spend, development, maintenance, apple/facebook tax etc.
  • As mentioned before in a previous post, the CAC of monetizing users can range anywhere from $0.75 to as high as $3 per install depending on targeting. (You can argue a K-factor can reduce this spend by a modest half and assume a 5% monetization rate rather than the industry average of 2% because the game is developed with all the right social mechanics & has a sufficient marketing budget. Keep in mind a $0.75-$3 CAC does not guarantee an engaged player that will monetize. Out of 1000, you can expect a range of 5-15% retention rate depending on a number of targeting factors.)
  • Having numbers such as $1.20ARPMAU, doesn’t tell you much in terms of ROI even though it does look pretty on an info graphic.
  • MAU is also deceiving because unless you know things like churn or retention rates, this number is just indicating  ‘popularity’ or maybe even marketing spend.
  • A social casino game has whales. As a social game dev. Im very interested to see the breakdown of ARPPU by $/spend (of course most companies won’t give out these metrics, but I heard a story about one lady from North Carolina that spent $65,000 in a month on a social slots game! This lady alone would skew the ARPMAU metrics dramatically)
  • Social casino game players are loyal (so Ms. Carolina might not go to your game – you have to find you own whales)
  • Loyalty in social casinos don’t mean that they won’t try another other games. (You gotta give Ms.Carolina a good first impression)
  • Social casino game players do care where their friends play and the quality of the games so looking at top games with ~5Million MAU into an industry of estimated 100+Million players worldwide, there is definitely lots of room for new & innovative products.

Overall, I would say there is definitely money to be made for the right social casino product especially paralleled with an existing product/brand. I don’t think launching the same-same and throwing marketing money at it will get you anywhere fast. I also don’t think you need to be so creative that people can’t recognize they are in a social casino. The secret is balance.

With creative game design, a social casino can be a low-cost, highly engaging way to interact with a customer base as well as add a lucrative revenue stream.

Interested in launching a social casino? Email me here to start chats!

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