Advertising – is it a waste of money?

26 08 2008

Last two months has been really busy and I haven’t put much attention to advertising. Actually, I haven’t done it at all. Until yesterday.

I hate advertising because I always feel like the only one that earns money is the Ad Server.  Even if clicks or impressions are not soo expensive it is hard to turn them into profits. Why? Games are either too cheap or too expensive.

But I read a book about AdWords and it gave me some inspiration. I also noticed that Pony World has quite good visitor to download ratio – over 40% of visitors download the game. With that ratio maybe it will not to that hard to turn AdWords into profits?

I created two ad variations for selected keywords and set up a daily budget of a little over $10. And today I got the results (that’s what I love about AdWords – almost instant results).

My ads received 90 clicks total: 51 for ad variation #1and 39 for ad variation #2. CTR for those ads: 1.55% for #1 and 1.22% for #2. Not so bad,  especially one you show it by keywords: the best CTR is 10.38% and the lowest one is 0.77%. The lowest one represents most of impressions and clicks.

Because that’s just 90 clicks I don’t know if it’s profitable yet or not, but we can do some estimations. Let’s go to Google Analytics and check if those clickers download the game. This is where we face first disappointment. Only 19.48% of clickers downloads the game. It’s still much better than what I had for Runes of Avalon campaign where only 11% of visitors downloaded the game.

If Pony World Deluxe has 1% CR (download to sale) then I need 100 downloads to sell one game. And I need 513 clicks to get 100 downloads. 513 clicks will cost me over $68. And I get only $17 out of each sale, so each sale makes me a loss of $51.

Judging just by those numbers you can for sure say that advertising is a waste of money. And it is if you do it wrong. It is if you aim short term. It is if you don’t tweak your ads, your game and your game description web page. It is if you don’t increase your visitor value.

It takes time to turn advertising into profits. Most people are not patient enough.

I made some tweaks to my ads and will do for at least few more days. If I can see improvements then I’ll keep advertising until I make a profit or run out of money :D

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3 responses to “Advertising – is it a waste of money?”

27 08 2008
ChrisP (12:48:07) :

Indeed. All my forays into advertising have been utterly disastrous thus far. I sunk over $400 into it and made maybe $50 back. Not touching that again, at least not for a long while!

That said, I’ve heard that advertising for indie games can have positive results. I believe Cliff of Positech Games has had some success with Google ads. He has many more products for sale and a lot more experience than I do though, both of which must help.

29 08 2008
jack norton (15:25:17) :

I’ve many games too but I never spent much on ads (almost none). Not worth it. Better invest that money in assets to produce your next game.

28 10 2008
Joe (06:51:14) :

I think you would need several months worth of data to make a decision. If a customer purchases one game from you would they come back and buy 2 more in a week? It seems for every 10 customers your pick up at least one or 2 that would be repeat customers. 1 out of 50 may buy 6 games over the next 12 months. How many who click on your ad will add your site to their fav’s list for a future visit? Lots of variables. Here is a link to an article on how one guy increased his converisons with adwords