When your cost-per-install figures rise above your customer lifetime value, as they have for most of the mobile games industry, that’s when you’re in trouble — at least according to Michael Velkes’ Casual Connect Tel Aviv 2015 lecture. “I would say that’s a broken business model,” Michael stated. “But we can overcome.” For Michael’s three tips on repairing your mobile games strategy, see Michael’s full session below.
Michael Velkes currently helps well funded Asian companies grow in the west and at Plamee. He also helps two companies from the local Israeli gaming market which I believe are the next big studios coming out of Israel - Planet of the Apps and Tacticsoft. Plamee is a leading mobile game studio, publisher and technology provider; it is the gaming and financial trading industry’s largest listed software, technology and services company. Michael describes work as “super interesting and challenging” in this company with more than 200 employees in four sites in Russia. Michael particularly enjoys the people, the team and the passion of the games industry.
Fascinated by Growth
Michael is fascinated by growth, the endless challenges to create it and the creative ideas that must be generated to make it happen. “Growth in general is something that inspires me,” Michael says. “I love seeing the first steps into the product to understand where the features are that will create this growth, understand how to create the marketing strategy for various products and deciding which products should close.” And Michael says it is amazing to see the data, understand behavior, then make changes and see the data change.
A Job with So Many Advantages
Boredom! That’s what first enticed Michael into the games industry. We became bored while at university, so Michael and his friend began creating new versions of poker. And, as Michael says, creating entertainment and fun has so many advantages over an ordinary 9-to-5 job.
His previous career, on the network side of the industry, has helped him in his current work to understand which channels are good and who has the right media for a particular game. With this knowledge he is able to reduce waste in marketing budgets. The connections Michael has made also help him minimize the time needed for research and networking.
Michael has had a number of greatly satisfying career experiences. One of these was occurred when he helped Brave Frontier to grow and hit the top of the charts all over the world, working with their UA manager. A second was the growth of Pirate Kings; Michael was part of the team that led Pirate Kings in scaling exponentially.
What’s Coming
The big trend Michael sees coming in the games industry is virtual reality, although they are still trying to understand how and when. And, of course, mobile continues to be a rapidly growing part of the industry; Michael says, “I am trying to be on top of my game every day in this area.”
One of the most fascinating trends they have observed this year is engagement in Asia and Southeast Asia. Michael notes, “Almost all engagement parameters are doubled when you hit the Asian market.”
Make Decisions by the Numbers
Along with this growth comes increasing challenges in monetization; as they point out, with free-to-play games, there are tremendous numbers of non-paying players, and companies are paying to acquire them. Michael deals with this problem by using rewarded ads. These videos reward players who don’t wish to pay and, at the same time, reward the company by allowing them to monetize the non-paying users. Michael also believes the challenge of monetization will be reduced as more brands come into the free-to-play space and help native advertising to grow.
To companies dealing with monetization issues, Michael emphasizes, “Data! Data! Data! Make your decisions by the numbers and not by gut feelings.” And to keep players involved and willing to pay in the game, they recommend using promotions and live ops.
Look for What the Next Year Will Bring
Plamee has developed their own in-house tools for making mobile marketing decisions. They have found Facebook a very effective channel for marketing, especially since they continue to grow and improve. Additionally, Michael really likes Applovin, saying, “They are a unique company in the industry and they really have built amazing learning technology.”
For handling changing technology, Michael uses what their father taught them: Always be on the top of your game and look for what the next year will bring. So Michael doesn’t find new technologies a problem; they simply make sure to learn them before they become mainstream. Then, once the technology is out, they use it extensively to build experience with it.
Michael admits to a soccer addiction that takes up much of their free time. They play it, watch it live and watch it on TV. And, of course, Michael also considers it important to spend time with family.
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