Ali, from Peanut Labs, talks about monetizing games
You can download the podcast here…
Or listen to it here…
Interviewer: I’m here at Casual Connect and with me today is a special guest. How about you introduce yourself?
Ali: Hi, my name is Ali Moiz and I am one of the founders of Peanut Labs.
Interviewer: What’s Peanut Labs about?
Ali: Peanut Labs is a monetization company that we focus on research primarily, and we tie research to end game virtual currencies and virtual economies, so micro-transactions.
Interviewer: Is it pretty much then for MMOs, or is it any type of game or what?
Ali: We have a wider spectrum of partners than some of the other players in the space. We work with MMOs. We work with casual game companies. We work with social media game companies. We work with blogging sites like LifeJournal, SixApart, Xanga. We work with dating sites like OkCupid. So, it’s a slightly broader demographic. Gaming is really, I feel, like one of the sweet spots for the industry.
Interviewer: So, you’re saying that people could use your service even if they don’t have a game. It can be just anything with virtual currency, any situation where they have virtual currency or virtual economy.
Ali: Absolutely, so Xanga, they are one of the oldest blogging sites on the Internet. They are a good example. So, they give out Xanga credits to users to upgrade their profiles, add new features, more stories, more photos, more skins. And you can either pay for them or get them for free by doing online surveys and research or ads with us.
Interviewer: Can you talk about the specific types of surveys? Is it kind of like the other traditional offers that you see on some of the other competitors in your space, or are these different types?
Ali: So what really sets Peanut Labs apart from the other players in the space is I feel like fundamentally there are two kinds of inventory that make up most of the market. There are research surveys, and then there are online ads.
Research surveys are 5 to 10 minute online surveys, no marketing, no lead generation, pure anonymous research from Fortune 500 brands and research agencies, people like P&G, Unilever, Microsoft, AT&T, Nielsen, comScore, those guys. They are actually getting value out of your anonymous opinion and putting that together to size markets and new market data. That’s one market.
The other market is lead generation, CPA. So, we focus on the research market. We also do the lead generation. For the last three years I’ve spent three years and five million dollars turning out a roster of clients on the research side that exclusively do a lot of their research with us.
Interviewer: So, then the players don’t necessarily have to get spammed or anything else when they fill out these surveys because it’s purely research or something else like that.
Ali: That’s exactly the value proposition. So, two examples. One is survey when a new movie comes out. Universal Studios might come to us and say, “Here are five different trailers for the movie. Peanut Labs, go and interview 100,000 people. Help us figure out what the best trailer should be that will increase our sales the most” because they’re talking millions of dollars for opening day weekend. And a good or bad trailer can be like a 10 million dollar difference on a Friday night. So, they spend a lot of money doing research.
Procter & Gamble, for example, spends about $200 million a year, trying to figure out how to market their products and how to make them better.
Interviewer: You mentioned that gaming is the sweet spot. How would a game developer use your service to make money and to keep their players happy, too, so they don’t alienate them with bad offers or something else like that?
Ali: One of the primary reasons that game companies have worked with us is because they feel surveys are more sustainable than offers long-term because offers tend to churn and burn users whereas surveys are more sustainable. The larger the company the more likely the more quality-focused they are and the longer their horizon is.
For companies like Electronic Arts or Acclaim Games that we work with, they work with our surveys and tie them into the virtual currency so the use case is, players playing one of their games, they are playing Nine Moons and they want a fancy new sword and they don’t want to pay for it. It’s just the case that 95 percent of the users that play the games, so they take a five minute online survey. Our clients pay us. We pay Acclaim, and then Acclaim gives the user the sword.
Interviewer: Can players make as much coin filling out these research surveys compared to actually doing the trial offers or something else like that? Do they just have to fill out a lot more surveys? How does that work?
Ali: The surveys pay out slightly less when you compare it to an offer on average. Marketing credit card companies will pay out sometimes a hundred bucks a lead if somebody fills out a credit card form. Survey companies don’t pay out that much, but the conversion rates are about three to four times higher for surveys than for offers because you are not entering your information. You’re not entering your credit card. You’re not getting marketed or spammed, so the conversion rates are much higher.
Interviewer: Let’s say a game developer wants to get started and use surveys as part of their offering to generate revenue. How would they do that with your company?
Ali: It’s really simple. You can get in touch with me or any of our people, or you can go to our site, peanutlabsmedia.com, and just create an account. The process is self-service and automated, so you can be up and running in 20 minutes.
Interviewer: Do you have any suggestions on things that game developers can do to make sure that more players actually fill out the surveys? Do you have best practices for ways that developers can monetize their game much more effectively with surveys without alienating their audience?
Ali: Sure. I think there are probably like 30, 40, 50 things out there that they can do, and a lot of it has already been covered by some of our competitors, and you’ve done a good job in your book as well covering a lot of these things. For stuff unique to surveys and offers is surveys and offers could be tied more closely to in-game progress for the characters rather than just generic or virtual currency. Game developers could make it a more integrated part of their quest line or story line.
There are also ways to segment users and target them based on demographic information. We provide about 14 different pieces of demographic information to all of the partners we work with, and they can use that to better target users. For example, age, sex, gender, location, income, ethnicity, education levels. We collect all this stuff because we do research on these users, and so we provide all of this information to you so you can better segment your target.
Interviewer: When you talk about actually integrating the survey into the character’s progress in the game, you just mean that a certain area of the game is blocked out until they fill out a survey or how exactly would a game developer design or integrate the survey in conjunction with the progress?
Ali: That’s just one example. We have an API where you can take our inventory and program it and put it in different parts of your game. The locked content is one area. Typically, things in games that you are already charging for are a good substitute for this. And also level progression, rare items, so a lot of game developers also uniquely release limited content every week; 5000 editions of a particular orb or a globe or a spell or a new gun that are not going to be available again next week, and they feel that doing this on a regular basis helps boost their revenue. They can either charge for it. They can run it through surveys, offers or they can do all of the above.
Interviewer: Have you ever seen people lock the content behind surveys then? So, it’s like: to get this special item, you actually have to fill out a survey. And have you seen any positive results compared to that?
Ali: I have seen developers do locked stuff behind micro transactions in general, not just surveys and offers but surveys, offers and payments so that people get… As a user, what you don’t want is you don’t want to limit the choice of payment options. I have seen them offer all of the options.
Interviewer: Any last words for game developers who want to make money off of surveys and make more revenue from their games?
Ali: Try it out. Everyone has their marketing pitches. You’re never really going to know until you try different partners out, but also what I would suggest is looking at the churn rate in addition to eCPM revenues because what you don’t want is you’re making five bucks a user but you’ve lost them forever as opposed to your making 10 dollars from a user but you’re going to keep them for a while. So, look at churn rate. Look at customer support complaints. Look at how fast you are losing users by running certain kinds of ads and take that into account when picking partners.
Interviewer: Thank you very much.