Category: business

In my never ending quest to have 1% of the metrics-obsession of zynga, I’m going to just brain dump loads of web stats and see if anyone can drawn more epic conclusions than I can.

For the last two weeks (27th feb – 12th march), here are some analytics web stats for positech.co.uk

There were 32,500 visits, and the bounce rate was 66%.

32% was direct traffic, which is interesting becauise I’d assume that was forum stuff, but the forums aren’t tagged by analytics at all. Weirdly, the top content for direct visits, with 10% of the total is the Kudos homepage. I bet this is a link through some [code] tags on a pirate site, hence no referrer. Oh joy.

If I look at new visitors, their top destination is Gratuitous Space Battles.

If I look, in general at visitors to the GSB homepage, the bounce rate is 44% which isn’t so bad. 24% of those who stay go to the demo page next, which is also a good sign.

When looking at the demo page itself, 18% of people bail out here, the top move for people who don’t is the demo download link, other people visit other parts of the site. That’s pretty good.

The second most popular page on my site is the positech homepage itself. It has a bounce rate of 45%, which could be lower, considering there are so many possible destinations from there. Scarily, the top destination from the homepage is actually this lil ol blog here. Very surprising, I’d expected the top result there to be GSB. Should this bother me?

Quite a few people click the small icons going to pages for affiliate sales. Harvest:Massive encounter got over 200 clicks in 14 days. There were zero sales, and generally affiliate sales are very low. I am strongly minded to remove all that from the front page, and concentrate on my own games, especially as I now have showmethegames to promote the general indie scene.

Looking at visitors, I can see that firefox is #1, followed by chrome. Internet explorer has just 23.8% of visitors. Specs-wise, the most common screen res is a scarily low 1024×768, followed by 1280×800. This seems to me that it is mostly laptop and netbook surfers. I surf a lot on my laptop, but work on a massive four trillion pixel monitor.

Demographics wise the top visitors are from the US, then UK, Canada, Germany, This is all good, and due to me changing the settings on my ad-campaigns no doubt.  Stats are awesome, the top state is California, and the top city is San francisco. You SF surfers are busy, with a shorter time on site than average :D. Scarily, if I look just at users who visited the GSB buy page, the #2 country is Brazil. I can’t find any sales to Brazil, so one can onyl hope thiose Brazilians tell their German friends they should check out the game…

I know… I need to get a life or something :D

There seemed to be a time where everyone worked in, or owned factories. Those factories would make widgets. You would build a widget factory that could make 10,000 widgets a year, and it would need to sell 5,000 widgets to break even. If you were unlucky, you sold less, but you probably had upgraded from a 2,000 widget shed/living room/small workshop, so that was unlikely. The best scenario was you sold 10,000 widgets, making perhaps twice the expected revenues and four times the profit. Maybe next year, you can borrow the money for a 20,000 widget factory, assuming widgets are still popular. Over a decade or more, you may end up tripling your salary, as owner.

Now it’s different. If my widgets are digitial, I can scale my factory far more cleverly. In terms of physical workspace, I need none, because bandwidth can be bought per MB and per second in ‘the cloud’. If I need more staff, I can recruit online, choosing from the estimated 1,966,514,816 people who are online, rather than the 2,000 people in my town. My ad budget can scale upwards by a factor of 100, or even 1,000 in the click of a mouse. You can even hire people online on a piece-work basis, and happily outsouce the customer service, the usability testing, the payment service, product fulfilment…

In short, a purely digital business like mine can just scrape along earning $10,000 a year, or thunder along earning $10,000,000 a year, like minecraft, and it can go from one to the other within weeks. WEEKS.

Obviously the reverse is possible too. The zero-infrastructure means there is nothing to sell when things go bad. The benefits of zero physica assets can also be a curse, in terms of the company having no real physical assets of any worth whatsoever.

It occurs to me that this is leading to far wilder income disparities for entrpreneurs than ever before. Only the most hardcore socialist thinks that everyone who runs a business is somehow evil and rich. We all know our local corner store that looks a bit ropey and probably doesn’t earn much. Generally, with the exception of bankers, we consider that competition works, and that businesses are making a reasonable profit, but not likely anything extraordinary unless there are outside signs, like a 10,000 strong workforce or huge headquarter offices.

Online changes that. Its only the publication of his sales data that makes it clear that minecrafts creator makes so much money. It’s only the l33t published office pictures that hint that puzzle pirates brings in some decent cash.

Online is different. People running a business online may be (often are) barely breaking even. They may also be multi-millionaires. I know quite a few people with online businesses, and their profitability varies dramatically. Despite my awkward admission I paid £75 for some jeans once, only me and my family know if positech is any sort of financial success.

Just as there may be more minecrafts than we know, there may be more penniless businesses too. If your corner store drops down to earning $100  a week, the rent is too high and your business folds. I know MANY people who have an online business that earns under $100 a  MONTH. The businesses still exist, albeit as part time ventures. Website rent is trivial compared to bricks and mortar, and the businesses remain active. The spectrum of online business success is far far wider than it is in the real world.

We live in interesting times..

Red buttons are NOT better than blue buttons. I have hard data for my gratuitous space battles index page demo button:

In fact they are much worse:
original
variation

Nothing beats hard data. Extrapolating from this is probably less helpful, given that my page is mostly blue so it might have ‘jarred’ but I had guessed that might be a good thing. it wasn’t.

Here are two assumptions you can (wrongly) make as an indie game developer:

1) If you show ads to someone, and they buy your game for $22, you earned $22 for showing them that ad.

2) If you spend $1000 on ads/marketing in december, and made $1200 worth of sales, you made a profit.

lets look at 1) first.

Obviously, you need to compare PROFIT not revenue, so we can assume that you got $22 after paying the payment company / portal royalty for that sale. But is that $22 the real profit from that customer? No, it’s only the start. If you release some DLC, a sequel, or just another game at any stage, you already ‘have’ that customer, in terms of them being aware of your business, and happy to purchase from you. What you need to do is to look at the average value of a customer over the customer lifetime, not that one sale. My maths tells me that a straight analysis of my google ads in December 2010 shows me losing money…. on the single purchases that derive from those ads, but I definitely make money on the long term. You don’t know the average revenue per customer? Find out…

Now 2)

There is a tendency to look at the total sales and subtract the ad budget and deduce the remains as profit, but there is another deduction to make, and thats ‘sales you would have got anyway’. Obviously we all get word-of-mouth sales, review-induced sales, and search-engine related sales. You need to look at your analytics *only* for the paid-traffic segment, and work out what proportion of sales to assign to the ads, THEN work out if you are making a return.

Don’t think that you can make assumptions there either, the paid traffic might be more(or less) likely to visit the buy page, so you need to actually analyse that. Again, my december stats look pretty awesome if I assign all my sales revenue to the ad budget, but if I only assign the sales that came from the ad traffic, it’s a different story.

These are just two more, of the fourty-million ways in which people can not know the numbers, and thus lose money on ads. This is time well spent. It also makes a change from debugging :D