Another "what is a user worth in revenue" thread
2 comments
Your calculations sound straight forward, but they obviously apply to you only. Each site is different. Google, for example, makes a lot more per user (I would guess) because people go there to look for specific things, and Google offers targeted ads that pay several dollars per click in many cases.
It sounds like you have something really good going on.
Hosting, servers, and other expenses will go up as you get more users, keeping the user experience fast and pleasent will be hard. Getting that $1 up to $2 would be important.
Check out RuneScape http://en.wikipedia.org/wiki/RuneScape they have a good model.
Hosting, servers, and other expenses will go up as you get more users, keeping the user experience fast and pleasent will be hard. Getting that $1 up to $2 would be important.
Check out RuneScape http://en.wikipedia.org/wiki/RuneScape they have a good model.
From my personal, very limited amateur web-game example, I get about ~$150 in google ads for my ~400 player game. Those 400 players are active considering they have used the game in the past 7 days. Users who haven't are deactivated. I'm convinced that with proper Google Ads optimization (there's only a single, badly placed ad right now), this could be doubled at least.
So, this makes me conclude that a user-year (a user being active on the site for a year; or two users a half year each, etc) is worth $1 in ads. Is that a realistic estimate? Or is it completely bogus or too dependent on other factors. Note that I'm talking about browser games, where users have fairly typical usage patterns regardless of the game itself.
Additionally, consider the "freemium" model (optional premium account with perks). Pricing is usually around $4 or $5 per month, let's round that to $50 per year. With conversion rates between 1% and 5%, a rate of 2% is a realistic example. 2% of $50 is ... $1.
So, the total user base yields another $1 per user-year for premiums. Is that realistic as well?
This means a user-year is worth $2... I know these are napkin-style calculations, but as far I see it the orders of magnitude make sense for a browser-based game.
Please enlighten me if I'm wrong.