What's the best way to set price points for in-game purchases?

2 Choose your monetization model

The next step is to choose your monetization model and how it aligns with your game design and goals. There are various models you can use, such as free-to-play, premium, freemium, pay-to-win, or hybrid. Each model has its own advantages and disadvantages, and may appeal to different types of players. For example, free-to-play games can attract more players and rely on in-game purchases as the main source of revenue, but they may also face more competition and retention issues. Premium games can charge upfront fees and offer a complete experience, but they may have lower conversion rates and less recurring revenue.

3 Set your base prices

The third step is to set your base prices for your in-game purchases, based on your costs, value proposition, and market research. You need to consider how much it costs to produce and maintain your game, how much value you offer to your players, and how much your competitors and similar games charge. You can use various methods to set your base prices, such as cost-plus, value-based, or market-based. You can also use psychological pricing techniques, such as anchoring, bundling, or charm pricing, to influence your players' perception and behavior.

4 Test and optimize your prices

The fourth step is to test and optimize your prices based on your performance data, player feedback, and market trends. You need to monitor your key metrics, such as conversion rates, retention rates, average revenue per user, and lifetime value, and see how they change in response to your price changes. You can also use A/B testing, split testing, or multivariate testing to compare different price points and see which ones perform better. You should also listen to your players' feedback and suggestions, and adjust your prices accordingly.

5 Offer discounts and promotions

The fifth step is to offer discounts and promotions to attract new players, retain existing players, and increase your revenue. You can use various types of discounts and promotions, such as seasonal sales, limited-time offers, loyalty rewards, or referral bonuses, to create a sense of urgency, exclusivity, or reciprocity among your players. You can also use dynamic pricing strategies, such as time-based, demand-based, or behavior-based, to tailor your prices to different segments, situations, or actions of your players.

6 Avoid common pitfalls

The final step is to avoid some of the common pitfalls that can harm your reputation, retention, and revenue. You should avoid setting your prices too high or too low, as they can either deter your players from spending or devalue your game. You should also avoid changing your prices too frequently or drastically, as they can confuse or annoy your players. You should also avoid making your in-game purchases too intrusive, aggressive, or unfair, as they can disrupt your game balance, quality, or ethics.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?