Sixteen and a half cents
See that? That’s how much money casual social games make per player per month. But before we explain where we got this number, here’s a little back story.A recent article on Benzinga initially stated that Zynga was losing $150 per paying player. That number was proven patently false by a response from Natural Motion’s CEO, Torsten Reil. However, the article did give some great insights into the core business metrics of the #1 casual social game company.
Data points from the article:
- CLV per paying user: $150
- Paid Customer Lifetime: 12 – 15 months
- Attrition rate (roughly): 20%
Based on the data shown above and Zynga’s updated S-1, we did a little bit of back-of-the-napkin math of our own.
From that, we can calculate the following:
- Estimated ARPPU: $11 ($150 / 13.5 months)
- Estimated free-to-paid conversion: 1.5% (3.4m paying users / 228m MAUs)
- Estimated ARPU: $0.165 ($11 * 1.5%)
Again, all back of the napkin, but an ARPU of $0.165 isn’t too far off from what other sources have mentioned in the past. To put this number in perspective, it’s one dime, one nickel and one-and-a-half pennies.
Which raises the question:
why are social game developers happy with making this much per user?
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