GSN Games business model

Monetizing in Social Casino & Skill GamesMassTLC 2014 Mobile Summit

Nick Bogovich (@nbogovich)Executive Director, MobileJuly 22, 2014

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o Two Modelso Social Casinoo Skill Games

o Making The Most Of Your Opportunities

Agenda

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Two Models: Social Casino & Skill GamesMassTLC 2014 Mobile Summit

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GSN Games is a leading provider of social casino and cash games

2013: Top 10 Grossing iPad app

2013: #2 skill gaming site

GSN Casino

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GSN Casino on iPad

• Games: Slots, Video Bingo, Video Poker, Blackjack

• Players buy and earn virtual currency to place bets in games of choice

• Available on mobile, social and gsn.com

Product Overview

GSN Cash Games

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WorldWinner.com

• Games: Card, Arcade,

Strategy, Word, Game

Shows• Players compete in practice & cash tournaments

• Available on web and mobile web

ProductOverview

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Social casino, skill games and gambling are not the same

CONSIDERATION(entry fee)

PRIZECHANCE

Skill

Games

Sweeps

Gambling

How to make sense of it all:

o No prize = Social casino

o Little or no chance = Skill games

o Entry fee, chance & prize = Gambling

SocialCasino

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Making The Most Of Your OpportunitiesMassTLC 2014 Mobile Summit

o The mobile landscape is crowdedo There are over 1 million apps on iOS and Google Play

o The odds of success are against youo 80% of apps don’t generate enough revenue to support a

standalone business. 59% don’t even cover development costs.

o If success is defined as your app’s profitability, how do you succeed?

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How Do You Make The Most Of Your Opportunities?

o Before anything else, do your homework! Identify your vision, mission and corresponding strategies

o Validate the business model – if you can’t figure it outon paper, you won’t figure it out after launch

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Tip #1: Form an Effective Product Strategy

o Spend ample time planning a UX that supports your app’s mission and strategies

o Focus on the MVP: Minimum Viable Product

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Tip #2: Carefully Manage Build Costs

o Be mindful of how your product will evolveo Prototype and test, early and ofteno “Look through the turn” – don’t be too short-sightedo Listen to your users!

o Know what you know and what you don’t knowo Play to your strengths; everything else can be outsourcedo There’s a fine line between leading edge and bleeding edgeo Keep 3rd parties honest

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Tip #2: Carefully Manage Build Costs

o Cost-per-acquisition (CPA) is just as important as lifetime value (LTV)

o LTV helps you measure the quality of your acquisition channels

o The sooner you optimize your acquisition funnel, the quicker yourbusiness will grow

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Tip #3: Understand your user acquisition funnel

(A) LTV: $4

- CPA: $3

Profit: $1(B) LTV: $1

- CPA: $2

Loss: $1

GOOD!

BAD!

o “You never get a second chance to make a first impression.”o 26% of app downloads are used 1 time

o 3 ways to keep users coming back1. Optimize your acquisition spend2. Effectively onboard users3. Measure and improve your retention rates

o Remove unnecessary transactional friction

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Tip #4: Make a good first impression

o Before launch, identify KPIs that represent successo How many DAUs do you expect?o What % of DAUs represent paying users?o What’s your target ARPPU?

o Establish target values ahead of launch to better identify where to improve your product

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Tip #5: Identify KPIs that represent success

Month 1 Goals

DAU: 5,000

% Payers: 2.0%

ARPPU: $12.50

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$1,250/day

o Boost revenues or lower cost of sales or operating expenses to increase your profitability.

o Be careful! Keeping costs low because you made the right decisions along the way is not the same as artificially cutting costs to maximize profitability.

o Making the most of your opportunities involves more than just what drops to the bottom line. It requires proper planning.

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The Bottom Line: How Does It All Add Up?

Thanks for listening!

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ContactNick Bogovich | Executive Director,

[email protected] | @nbogovich

http://careers.gsn.com/