The Psychology of Freemium Games

How game designers use behavioral psychology to make you spend more money

Not only Pokemon GO became top earning app on both the app store and play store within mere 24 hours of its launch, but also earned on average nearly $2.2 million (nearly Rs. 14 crores) per day in 2018. PUBG, another immensely popular mobile game, managed to rake in an absurd $712 million in revenue in just 8 months. The smartphone gaming industry is expected to grow at a fast pace with a projected revenue of approximately 24 billion dollars by 2021. With a fast growing market and lucrative business opportunities, app designers are looking to monetize game play and one way to do that is to integrate fundamental principles of behavioral psychology into game design.

From the perspective of a game developer, the objective is to incorporate monetizing elements into game play to manipulate players’ behavior by exploiting characteristics of human psychology and persuade them to continually spend more money.

While many elements like plot/story, graphics, link with real world or the historical facts play a crucial role in building more engaging and enjoyable user experience, there are some psychological principles and design strategies that can be leveraged to influence user behavior and monetize game play.

Lets dig deeper into the mechanism of freemium games and try to unravel the strategies used by game designers to drive the user behavior.

Using virtual currency for micro-transactions

Almost all of the freemium games use virtual currency for micro-transactions instead of actual money. A virtual currency like gold coins, gems or hearts create a psychological barrier between in-game spending and real currency spent. This tricks players from realizing actual impact of spending by morphing real money into in-game currency. Also, these games employ a micro-transaction model with convoluted exchange rates. For example, one needs to spend $4.99 for virtual game currency of 500 gold coins where a 80 gold coins get you 1 gemstone and a certain item costs 4 gemstones. This is done deliberately in order to discourage players to know actually how much money they are spending on that game item.

Also, some games have a dynamic pricing model. An item which costs $4.99 for a regular game player might be available at a lower price to a new player or someone who rarely plays that game. This not only incentivises the new/rare player to continue playing by portraying a false perception of a cheaper price point but also generates high revenue from the regular player who is ready to pay an increased price to continue playing. This also helps game developers to create sunk cost fallacy to keep players engaged.

Candy Crush Saga was actually designed by an economist to demonstrate how people don’t understand the concept of sunk cost.

Operant conditioning to influence player’s behavior

B. F. Skinner,an American psychologist, gave a systematic description of the manner in which environmental variables control human behavior. He stated that certain behaviors can be reinforced with positive rewards. While experimenting with different schedules of delivering positive reinforcements, he found that variable ratio reinforcement and variable interval reinforcement has the highest rate of response and the slowest rate of extinction. In layman’s terms, this means that if a person gets positive feedback/reward at a random time intervals for a particular behavior and the person doesn’t know how much he might receive next time, it is highly likely for the person to keep repeating that particular behavior (associating that behavior with positive reward) and finally fall into an obsession. The most common example of operant conditioning can be seen at casinos. Most gambling machines are designed in such a way that they deliver varying amount of rewards at random intervals to keep gamblers occupied.

Game designers leverage operant theory to drive players’ stimuli and use positive reward to manipulate players for a repeating game-play with more frequency. Often this continued playing develops into an obsession in which a person keeps playing long past the point of enjoyment. Some games have a daily reward system while some games offer a discount on continuous game achievements.The principles of operant theory are omnipresent in freemium game mechanics.

With millions of players all around the globe, game developers can collect enough data on players attitude and in-app behavior that they can pinpoint precisely when players are about to become disengaged and issue potential engagements( new items, tasks, rewards etc) at just the right moment. By using this aggregation of players’ gaming habits, they know exactly how to keep them playing as long as possible. It’s like having an ability, albeit limited, to read what’s going in players mind when they are playing your game, and being able to convert those insights into well-crafted strategies.

Removal of pain points

Some freemium games charge users for removal of pain points. A pain point can be described as something that delivers an undesirable and/or annoying experience to a player. Typical pain points are pop up ad banners, advertisements in the form of video etc. An engaged user finds these pain points annoying and is typically ready to pay for removal of pain points for more engaging and enjoyable game experience. Also some games have waiting time to open a treasure box or between game levels and charge for uninterrupted game play without pauses.

Some games require players invest a considerable amount of time to develop game character/build vehicle from scratch/collect arms depending on the game type. These games encourage player to pay for a level upgrade or to opt for a paid offer containing combined resource/tool kit for character development.

To summarize myself in a sentence, I’m an engineer by interest, strategy enthusiast by passion and an inquisitive thinker by nature. Currently final year student at VIT University , I write a blog on business strategy with a dedicated goal — To improve business acumen of college students, one article at a time. When I’m free, I love to read books and create digital art. Connect with me to find out more about what I have to offer — or get in touch to discuss how I can help you on your next project.