You created a concept for an indie game, poured blood, sweat and tears into it, and you’re ready to take it live. For anyone to ever know about it and play it, you must market it. The first step is choosing the correct marketing budget (which I go into here) for your game. Once you’ve done that, it’s time to budget and account for generating three important costs associated with marketing your game—paid media, owned media and earned media. Below I’m breaking down what indie game developers need to know about each, including what they are and how to budget for them. You can get a better sense of how they come into play in marketing your indie game with my fictitious forecast scenario at the end of this story.
Check back next time for a breakdown of all the publishing costs an indie game developer needs to consider when getting their game finished.
Paid media is, unquestionably, the most expensive type of media in the realm of game marketing. Coupled with the fact that it is typically the most understood and the most ignored form, it should be addressed first. Independent game developers often don’t believe it works because they don’t understand how to measure, evaluate, or optimize for it. Given that it is one of the core pillars of marketing, I vehemently advise my clients to prioritize it.
Indie and established developers alike must be reminded of the benefits of paid media, even if they cannot understand it. This is where an effective partnership comes into play. A partner who understands what your limitations are, perhaps a budget or experience as a limitation, who has produced and marketed games successfully, will educate and inform. This ensures that less mistakes are made. Ignorance is no excuse for doing all one can to make their game successful.
A primary challenge of other forms of marketing, whether influencer or social media, is that their results are not guaranteed, while one of the advantages of paid media is that it guarantees results, plain and simple – you get exactly what you spend your money on. It is the only one of the three pillars that is truly predictable. One should never underestimate the value in that knowledge. For example, if you’re purchasing impressions you know you’ll get them even before they happen. On the contrary, there is no such thing as a guarantee with word-of-mouth, buzz, social media, community, viral, or influencer marketing. It should be noted, though, that these forms have an upside potential that paid media does not – no ceiling or timeframe on the number of impressions possible
Paid media typically comprises roughly 80 percent of the total marketing budget. Developers and publishers should spend on media bought in CPM, CPC, and CPA. Other costs which should be taken into consideration include creative costs such as advertising agency costs, creative optimization costs, localization costs, and creative management platform costs.
There remains a type of cost that somewhat fits into the category of paid media worth mentioning, and those include direct influencer payments and non-digital spends like television, podcasts, affiliate spends, and platform spends (e.g., Xbox, PlayStation).
Owned media includes that which you create on your own; essentially all of what you’ll need to make in order for the other forms of media to function. These can be thought of as the assets you’re creating—whether those assets are websites, ads, social creative, videos, apps, brand assets like logos and key art, and even memes. Other forms of more cost-effective owned media include blogs, emails, push notifications, podcasts, dev diaries, social content, and forum communication on sites like Reddit and Discord. In order for owned media to operate/function, dashboards, email platforms, or the back end of your media buying technologies must be adequately funded.
Here, a decision must be made as to whether you hire and build an entirely internal creative services team to make these assets, or whether to outsource and hire an ad agency; either avenue produces an expense and absolutely must be accounted for and budgeted for. Only then will you be able to launch a campaign.
Generally speaking, and from what I’ve witnessed over my 20+ years of working in this field, the 80/20 split remains applicable in owned media, with 20 percent of your marketing budget allocated to owned media.
Earned media is all of the content generated by others. It is not necessarily paid for and is not guaranteed. Nevertheless, it can be one of the most effective marketing tools, if planned for. Think about earned media as viral content. Its budget is in the form of personnel hours, as companies typically have a team dedicated solely to maximizing earned media. This means it has a fixed cost barrier to entry.
Examples include editorial articles, user and editorial reviews, platform features, endemic content creation by influencers, as well as shared activity on social channels.
Fictitious Game Forecast
As a way to tie all of this information together, allow me to provide you with a real-world scenario. Let’s say we have a PC Steam game that targets core FPS fans and the financial team has forecasted $10 million in revenue in the first year – I don’t know if we’d call this indie, but it’s not a giant game either. Depending on which approach you take to derive a marketing budget, let’s imagine it’s set at $1.5 million or 15 percent of forecasted gross revenue.
As stated previously, 80 percent of the marketing budget – here, $1.2 million – should be set aside for paid media. If you’re wondering how far this will go, you’re asking the right question. On Facebook, for example, with an average CPM of $7.19, that 167 million impressions. On Google Display (GDN), with an average CPM of $2.80, that’s 429 million impressions. And on Twitch, with an average CPM of $11.24, that’s 107 million impressions. As a side note, industry calculations show an average CTR of .7 percent and CTC (for a free-to-play movie or PC game) of 15 percent.
It should be noted that there is a certain skill level associated with earning the average .7 percent CTR. Spending the money, while necessary, is not the only requirement. Larger publishers, marketers and developers, whether alone or as partners, will consistently earn better-than-average results simply because of experience. Independent developers should not expect a 7 percent CTR given that it is largely dependent on the ability to produce good creative, strong copy and more. An independent developer must also take into account that a portion of their budget will be spent on resources that larger developers and publishers already have in place and have employed successfully in the past.
Clearly, GDN is the most effective network, yielding you roughly 3 million landing page hits and approximately 450,000 installs. Needless to say, this is not enough to hit your revenue forecast – you need more installs. Enter: owned and earned media.
The remainder of the budget must account for ad creative costs of between $20,000 and $40,000, a $50,000 website, $30,000 worth of social ad creative development, and a year’s worth of trailers at $75,000. Next, you must account for the ad serving fees, any localization costs, brand creative costs, emails distribution costs, affiliate spends, and more, which may add upwards of $50,000 to the total cost.
Here’s a recap of how far $1.2 million goes on paid media:
- Facebook average CPM = $7.19 = 167 million impressions
- Google Display (GDN) average CPM = $2.80 = 429 million impressions
- Twitch average CPM = $11.24 = 107 million impressions
Some additional rough math (industry averages calculations):
- Average CTR (click through rate) = .7%
- Average CTC (click to convert) for a free to play mobile or PC game = 15%
- So if you spent all that money on the most effective network (GDN) you could expect about 3 million landing page hits and approximately 450K installs. Is this enough to hit your revenue forecast? I would be very confident in saying no. So you will need more installs from owned and earned media.
You have 20% of the budget left or $300K:
- Ad creative costs, if you hire an agency, might eat up $20k-$40K
- Building a website: another $50K
- Social ad creative development: $30K
- Producing trailers for a year? Maybe $75K
- Then you need to account for the ad serving fees, any localization costs, brand creative costs, emails distribution costs, affiliate spends. You see where I’m going—it gets tight.
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