Virtual world and social game ARPUs

Giff Constable metrics, social games, virtual worlds

coinsJustin Smith had an interesting slide deck at the Social Games Summit where he shared his estimates for monthly ARPUs (average revenue per user):

  • “good Facebook” – $0.30 – $0.40
  • “good MySpace” – $0.60 – $0.70

Some games can do much better. The Facebook game Battlestations shared some data in late 2008 where they appeared to have around a $1.00 ARPU, although their total user base was much smaller than the active player counts of the big Zynga or Playfish games.  Three Rings Puzzle Pirates, a virtual goods-based game outside of the socnet platforms, has reported getting a monthly ARPU of around $1.50.

I had been guess-timating an average social game figure of around $0.25, so was glad to see that the industry is hitting better numbers.

Within the virtual worlds space, there is quite a range.  My guess for Habbo Hotel gives them an ARPU of around $0.65 (based on a few data points: 2008 revenue of $74M, growth of registered users from 86M to 126M, and a guess that their monthly uniques grew from about 8M to 11.5M over the year).  Smallworlds disclosed that they were on track to hit a $1.40 ARPU. For IMVU, I estimate an ARPU of $1.62 (based on registered users of 35M, an active-to-registered ratio of 3%, and $1.7M monthly revenues from virtual goods).    Second Life (which Jeremy Liew estimated at $9.30) and the more “hardcore” free-to-play MMOGs tend to range between $5.00 and $10.00.

I should note that there is no definitive standard for what “ARPU” really means.  When I am working on P&L forecasts for ESC clients, I focus on a notion of “unique active players” who engage with the game/world at least once that month.  While I focus on conversion rates and average-spend-per-paying-player (or types of player), these ARPU guesses provide a useful sanity check.