Note: We’ve had two BIG launches last month!

1. The Mobile Growth Handbook 2022 is packed with incredible insights along with tried and tested strategies, this book is the perfect tool to learn from and hone your growth plans for this year. We feature hand-selected insights from the smartest mobile growth marketers.

We have over 100 pages of insights that can be accessed at all times (as soon as you sign up). Download the book now and get a head start on your growth strategies.

Download the book now and get a head start on your growth strategies. https://mobileuseracquisitionshow.com/mobile-growth-handbook-2022/

2. The Mobile Growth Slack: A community that was a part of our workshop series – The Mobile Growth Lab, is now open to the general public. Join over 150 mobile marketers to discuss challenges and share your expertise. More details are available here: https://mobileuseracquisitionshow.com/slack/

If you’re ready to join the growing community, fill this form: https://forms.gle/cRCYM4gT1tdXgg6u5

ABOUT ATIF: LinkedIn | Atif Twitter | Stardust

ABOUT ROCKETSHIP HQ: Website | LinkedIn  | Twitter | YouTube

KEY HIGHLIGHTS

💰 How to build a billion-dollar brand in just a few months

🧩 Community is important, but it’s one piece of the puzzle

🔗 Does community really define the brand, or the other way around

🔱 Successful UA involves using a three-pronged marketing strategy

🤑 The incentive you get for spending time in a blockchain game

💱 How NFT transferability can work in Web3 games

📊 The analytics that need to come to the world of blockchain gaming 

💪 The UA channels that will work well for Web3 games

🙌 How many people actually own NFTs

📈 What even multi-billion dollar companies must do to grow further

💡 The “aha” moment for blockchain gaming

📤 Takeaways on branding for an indie game dev

📢 How NFTs drive pre-registrations for a still-unreleased game

💕 Why Web3 game devs are more open to sharing than traditional game cos

👀 The most important factor from the LTV standpoint

KEY QUOTES

Using community to build your brand

What’s unique about blockchain gaming, especially with community taking the lead, is that you can really take the last two revolutions in gaming and combine them to create an actual three-pronged marketing approach. Of course, the steps are a little different, but at the end of the day, it comes down to building a community and allowing that community to define the brand you’re trying to build along with you, versus you defining it for them and then their being your brand’s ambassadors. In blockchain gaming, they really are pieces of the creation of that brand, and so they’re true ambassadors. And then, they help you acquire more users into that community at a cheaper cost.

How blockchain gaming helps the gamer earn by playing the game

With blockchain gaming, specifically with play and earn mechanics, the value I get now as a gamer is that the more time I spend in the game, I receive some sort of financial incentive to stay in the game. And in this medium, it’s NFTs or non-fungible tokens.

So the more time you spend, the more valuable you are to that game, and the more value you accrue as a member of that community. Whereas in F2P gaming, if you were a valuable user to the game, all of the value that was being accrued was for the game developer.

With this paradigm shift, you as a user have the ability to gain financially from your time being spent in the game. That’s what we mean when we talk about open economies and blockchain gaming.

What blockchain gaming can learn from free-to-play games

I think you’ll definitely have to take a lot of what was learned in F2P and move it over here. Look at the way that analysis is done. You know this well – you’ve run really large mobile UA teams, built a successful agency on the UA side. So you know that the modeling and the analytics side is so important to success in gaming, where you understand the audiences at a demographic level, geographic level, and even from a user behavior level.

A lot of those analytics need to come to blockchain gaming. When we talk to developers, they either don’t have the DNA or haven’t thought of this. But it will be extremely important to make that shift.

Using NFTs to drive pre-registrations for a still-to-be-released game

Most of these NFT drops, as you know, are only like 10,000 people. But they were able to drive hundreds of thousands of pre-registrations, because even if people didn’t get that NFT — which the community had been building up and they soared in value — they still thought, “Hey, this game is amazing. Even if I didn’t get that NFT, I still want to be a part of this when it comes out. I want to register.”

Blockchain gaming encourages game dev companies to work together

Take that sword example, and think of what that sword is worth in Game A, and how that translates to Game B. Do you trade that sword for an item in the other game right away and make it valuable in terms of intrinsic value? How do you do that? And because these values are not static like they were in F2P mobile, what would happen if I took Sword A in Game A to, say, GoldenEye? Does the sword have value? Does it have functionality?

I think as you see more games come out and be successful, game developers will be forced to start working together to figure some of these things out. And this is actually super exciting. One of the things that I’ve noticed going from web 2.0 to Web3 or a F2P to blockchain gaming, is that the F2P model was very adversarial, right? Gaming companies were not playing nice. They were not sharing things. They didn’t want people to know each other. And to a certain extent, if you look at F2P mobile – innovation is stunted because there probably wasn’t enough knowledge sharing or openness about what needs to get done.

How LTV will work for Web3 games

I think from an LTV perspective, the shift will be towards retention. At the end of the day, this is a community-based open economy, and you want to drive the most engaged users to stay in the game longer, because that’s what will make them stronger parts of the community. That, in turn, increases the value of those NFTs and tokens. So retention is going to be the most important factor. And the way to retain people in this new paradigm will be around providing them value from a community perspective. Which means – how do you make sure that you are innovating to keep them in the games?

FULL TRANSCRIPT BELOW

Shamanth Rao

I’m very excited to welcome Atif Khan to the show. Atif, welcome to the show.

Atif Khan

Thank you so much for having me. I’ve known you for so many years and so excited to be here to chat and catch up.

Shamanth

As you said, we worked together for many years when you were at Facebook, and I was certainly very impressed by the insight you brought to a lot of our conversations. We’re connecting because of what you do now and what you’ve been sharing very openly in your ‘That Dude in Crypto’ series. Folks who aren’t familiar with it – please check out Atif’s writing on LinkedIn and Twitter.

You’ve been right in the trenches of all things Web3 and crypto, and I’m excited to dive into a lot of that today, because Web3 and crypto are changing gaming and a lot of tech as we know it.

To start off, right now there is a lot of buzz around community as a key lever for the growth of Web3 based games. Do you see that being sustainable in the long term?

Atif

It’s an interesting concept, especially if you look at some of the players in the space. Take BAYC – Bored Ape Yacht Club. Look at what they’ve been able to do — they built a billion-dollar brand in only a few months just based on building a really strong community. So we’re seeing a bit of a paradigm shift where community allows you to define your brand. Over time, the brand that you define decreases your cost of acquiring new users.

So I think it’s a slightly different paradigm. When you look at console gaming, it was all about brand, right? Like a movie trailer, you know – people got excited about a game that was coming up. In this last gaming revolution of free-to-play mobile, it’s been all about performance marketing, and a strong brand helps a little bit by decreasing the cost.

When you really consider the way F2P came about, you’ll find it was about that social, community piece. It kind of got taken out by some of the advertising products that were out there where you could actually just find the users that you needed to grow your game.

I think with this new paradigm shift, we’re seeing community as that important piece. It’s like the foundation. But you’re really going to need a three-pronged, full funnel marketing approach to be successful in this space. And that’s what we’re seeing right now.

Shamanth

Tell us more about what you mean when you say three-pronged.

Atif

What’s unique about blockchain gaming, especially with community taking the lead, is that you can really take the last two revolutions in gaming and combine them to create an actual three-pronged marketing approach. Of course, the steps are a little different, but at the end of the day, it comes down to building a community and allowing that community to define the brand you’re trying to build along with you, versus you defining it for them and then their being your brand’s ambassadors.

In blockchain gaming, they really are pieces of the creation of that brand, and so they’re true ambassadors. And then, they help you acquire more users into that community at a cheaper cost.

And so, you’re going to need a really strong community aspect of your marketing team. You’ll need to actually have a two-way communication that feeds into the way you talk about your brand, the way you build your brand, filter your brand, who you’re inviting into that community.

Then you put those two things together to build an acquisition strategy – how you actually drive users towards that brand, into the game, into that app experience or whatever it is in the Web3 space. So, what blockchain gaming can do for gaming is to allow us to have a broader circle, because you have to have all three prongs of that marketing.

Shamanth

You said that in blockchain-based gaming, the community is actually invested in the game itself. For folks who may not be familiar with blockchain-based gaming, can you help them understand the exact mechanics of how and why that is the case?

Atif

Sure. Let’s consider console gaming, which was a predominant player for years and years, the thing that I grew up playing, right — Sega Genesis or SNES or any of those things. You would go to a store, and for one time, you would pay $50 to buy a game. That was the transaction, right? You would spend hours and hours in that game, but the game developer would make just that $50 off of that. And there was no real communication back and forth. Until you got like online gaming and then people were playing against each other.

The way the F2P gaming model worked was to save time in the game, and you would buy items for that time. So, from that perspective, the approach turned into moving people down the purchase funnel. It was still about time, but it was around the time you were saving, not the time you were investing.

With blockchain gaming, specifically with play and earn mechanics, the value I get now as a gamer is that the more time I spend in the game, I receive some sort of financial incentive to stay in the game. And in this medium, it’s NFTs or non-fungible tokens.

So the more time you spend, the more valuable you are to that game, and the more value you accrue as a member of that community. Whereas in F2P gaming, if you were a valuable user to the game, all of the value that was being accrued was for the game developer.

With this paradigm shift, you as a user have the ability to gain financially from your time being spent in the game. That’s what we mean when we talk about open economies and blockchain gaming.

Shamanth

And if I may also point out, in F2P, the longer you stay in a game, you’re valuable within the pecking order of that particular game, but that doesn’t count for anything outside of that game. But with blockchain gaming, that status, if you will, or any NFTs you’ve accumulated in Game A, are valuable outside of Game A, right?

Atif

Exactly, that’s where the openness comes. I think some of the important questions that need to be figured out, though, include things like how a sword in, say, Candy Crush accrues value. But yes, that sword you got in Game A is now worth X amount of dollars on OpenSea, whereas you couldn’t take that sword out of Game A in F2P mobile.

Shamanth

True – you probably wouldn’t be able to use the sword in a Scrabble game, or something completely unrelated, right? That piece needs to be figured out, but it’s still way better than not being able to take that sword anywhere.

Atif

Exactly! Think about the region of the world we’re originally from. People there play hours and hours of games. And now imagine if you are in an up-and-coming country. You can make an extra $500 a month just because you’re spending two hours a night playing the game! That not only changes the paradigm of how value is accrued, but it also changes the economics of how people can come out of these countries and build better, greater things.

Shamanth

Certainly, that makes sense. And I like the way you contrasted the models of the console, how the economy worked, how F2P worked and now how this is different, even though a lot of the details still need to be figured out.

With all of that set and established, how do you see growth and acquisition evolve for Web3 based games?  I know you talked about brand building and how critical that is, but in terms of the actual tactics of user acquisition for growth, what platforms do you see as being effective and how do you see some of the strategies being different from F2P?

Atif

I think you’ll definitely have to take a lot of what was learned in F2P and move it over here. Look at the way that analysis is done. You know this well – you’ve run really large mobile UA teams, built a successful agency on the UA side. So you know that the modeling and the analytics side is so important to success in gaming, where you understand the audiences at a demographic level, geographic level, and even from a user behavior level.

A lot of those analytics need to come to blockchain gaming. When we talk to developers, they either don’t have the DNA or haven’t thought of this. But it will be extremely important to make that shift.

I think you’ll definitely have to take a lot of what was learned in F2P and move it over here. Look at the way that analysis is done. You know this well – you’ve run really large mobile UA teams, built a successful agency on the UA side. So you know that the modeling and the analytics side is so important to success in gaming, where you understand the audiences at a demographic level, geographic level, and even from a user behavior level.

A lot of those analytics need to come to blockchain gaming. When we talk to developers, they either don’t have the DNA or haven’t thought of this. But it will be extremely important to make that shift.

We’re also going to see similar channels do well, you know? The demise of Google and Facebook, specifically Facebook, is probably greatly exaggerated. I think you’ll see Facebook continue to be an important part of the channel mix for any game developer looking to acquire users. I think you’re also going to start to see other platforms continuing to grow, like Snapchat, specifically like TikTok, which is driving a lot of volume and scale at lower costs.

You’ll also see other types of mediums come into play, like connected TV, right? If you think about what a blockchain game does and the fact that it is an open economy, you can probably play it on your phone, on your TV, on your PC. That means things like connected TV will continue to be more important sources for traffic.

So I think what you’re going to see is similar tactics, similar analytics, similar breakdowns, because blockchain gives you more transparency around the data, which I think is really important. New platforms will come in and start to take over mindshare, but the old ones are still going to be solid sources of traffic.

Shamanth

And would it be fair to say that that is because those platforms are where the audiences are and they’re the primary way to get audience adoption? My understanding is that for a lot of blockchain-based games,  acquisition is still web-based, as compared to F2P, which is more app-based. So, would the actual tactical execution be very similar or comparable to most web-based products or web-based campaigns?

Atif

I think they will. On the mobile side specifically, we’ll need to see how the platforms react to NFTs. This is important because it will define what games can actually have on the mobile side, in terms of NFTs and tokens. And also, there aren’t a lot of successful games right now with tokens or NFTs embedded within them. But yes, definitely on the web side, blockchain gaming companies are starting to get serious about it. Take Axie, for instance. Axie is working with a large agency, both on the paid acquisition side and the organic side. That says that they’re starting to think about things just like any web first company or any mobile first company would.

Shamanth

I think that’s also a sign that Web3 games are starting to look actively at growth marketing and user acquisition, right? Because again, while community and brand are important, truly scaling is going to be dependent on user acquisition activity.

Atif

Oh yes, a hundred percent. It’s what you said – it’s where the audiences are. There are over 2 billion people on Facebook’s family of apps. There are a billion plus people on TikTok, and I think the last time I checked, there were a few hundred million people doing crypto globally. But NFTs? I think only 4 million people or so own NFTs. So yes, if you want to expand the audience, you need to go where the audience is.

Shamanth

It’s crazy that a lot of this is growing via web-based acquisition still, right? If we can bridge that gap between mobile and a lot of the Web3 games, I imagine that could be a big inflection point.

Atif

And that speaks volumes to how strong the community building is! If you look at the examples we talked about, they’ve built the communities from Twitter and Discord and web acquisition and meet ups.

During the pandemic, multiple billion-dollar companies and brands have been built on the community aspect. But for them to get to $10, 15 or 100 billion, they need to go out there and acquire users on other platforms that have those audiences.

And so, the aha moment for F2P mobile, which will be the aha moment for blockchain gaming is – everybody could play Candy Crush. Right? You would see everyone from grandmothers in subways to little kids playing Candy Crush. That’s what made F2P mobile so amazing – it opened up the audience of potential users. That’s the key to any entertainment business – what is the addressable audience and how can you make that audience bigger?

Shamanth

Certainly, that makes sense. I know you’ve touched a little bit on branding and how and why it is critical. Can you think of examples of Web3-based games that have done very well at branding themselves? And if so, are there takeaways for a smaller or independent game development company that might be trying to build their brand and do it well?

Atif

Well, the games that everybody’s excited about have done a fantastic job. Look at Star Atlas and what the team has achieved in the way that they’ve thought about their white paper, the visuals that they’re sharing, their mission. The extraordinary thing about them is that their game is a few years out, but people are still super excited about it. That tells you how strong a brand they’ve built.

That’s a good example of thoughtful marketing around a core mission and focus with which they built an extraordinary game, and then there’s their honesty with the community. They’re a really good example of a gaming company that is building community, building brand, being honest about it and still driving a ton of value for the people within that community.

I think we’re going to see more examples this year, as we bring in more sophisticated gaming teams that have that experience of building brand and doing that marketing. We’re starting to see some of those pop up, but Star Atlas would really be one that stands out to me personally.

Shamanth

It sounds like what they did well is share, and share openly with the community, and allow the community to engage. So the community felt invested in the brand and really supported it, which in turn helped the brand get built.

The last time we spoke, Atif, you gave me an example of a Web3 game that drove a lot of pre-registrations by offering NFTs. Can you tell us about the exact mechanics of how they did that, and why NFTs would be so valuable if the game isn’t even out in public? 

Atif

I believe I was talking about the Guild of Guardians example, right? You know, that’s a game funded on Immutable X. It’s a follow-up game to the first game of Immutable X – Gods Unchained.

What they were able to do was build a really successful first game and keep the community engaged. Then when the second game came out, they were able to highlight this by saying, “Hey, we’ve done this before. We built a really successful game. This is our follow-up game.” And they started to engage the community.

Once they were able to do that, they could really drive conversation in that community. “Build hype” is probably the best way to describe it! Then they did an NFT drop at the right time.

Most of these NFT drops, as you know, are only like 10,000 people. But they were able to drive hundreds of thousands of pre-registrations, because even if people didn’t get that NFT — which the community had been building up and they soared in value — they still thought, “Hey, this game is amazing. Even if I didn’t get that NFT, I still want to be a part of this when it comes out. I want to register.”

So, if you think about it, NFTs are really not only value for the user. They have the ability to be a fantastic user acquisition channel for these game developers. If you’re able to build that brand again, and work with your community to build the brand in the way Star Atlas did, all of a sudden, people are so invested that even if they don’t get that NFT, they still want to be a part of the community.

It’s almost like what the App Store was when they had the top brick, and there were only a million games. That first couple of hundred thousand organic users are super impactful – they drive your costs down, they drive engagement up and they’re a hundred percent margin.

You can use that same kind of tactic with an NFT if you build the right community and build the right hype around it.

Shamanth

And what’s impressive is that people picked up these NFTs even before the game was out, because they had the conviction and how valuable the NFTs could become.

Just to touch on the NFT aspect a bit more. You said earlier that the transferability, if you will, of the NFTs still isn’t a hundred percent clear and needs to be worked out and you gave the example of a sword. I’m curious if you can think of any examples of that kind of transferability currently, where an NFT from Game A has value outside of it? Is there any dimension of that problem being solved just now?

Atif

Yes, there’s definitely the whole aspect of “hey, this NFT is worth a lot outside of the game.” If you go to OpenSea, you’ll find all the different games that I’ve done, the NFT drops, and some of them are super valuable.

Some games have done a great job of building brand and community. We talked about some of those. And for some it’s purely speculative, right? That’s the nature of where we’re at.

But to answer your question specifically, we just haven’t seen that many breakthrough hits on the blockchain side. There are not that many games out right now. I think this year is going to be very important as more games come out and we see more success stories. That will force answer a lot of the questions.

Take that sword example, and think of what that sword is worth in Game A, and how that translates to Game B. Do you trade that sword for an item in the other game right away and make it valuable in terms of intrinsic value? How do you do that? And because these values are not static like they were in F2P mobile, what would happen if I took Sword A in Game A to, say, GoldenEye? Does the sword have value? Does it have functionality?

I think as you see more games come out and be successful, game developers will be forced to start working together to figure some of these things out. And this is actually super exciting. One of the things that I’ve noticed going from web 2.0 to Web3 or a F2P to blockchain gaming, is that the F2P model was very adversarial, right? Gaming companies were not playing nice. They were not sharing things. They didn’t want people to know each other. And to a certain extent, if you look at F2P mobile – innovation is stunted because there probably wasn’t enough knowledge sharing or openness about what needs to get done.

On the user acquisition side, there was a lot of back and forth and camaraderie. That’s why you saw such success on the UA side. But on the game design side, we didn’t see that. In blockchain gaming, this is a big difference I’ve noticed – gaming companies being open to talk to other gaming companies and be helpful and trade notes.

So as we see more games come out and be successful, it’s going to force gaming companies to work together to figure things out. In the end, this will be a net positive for the user experience, which should be the most important thing anyway.

Shamanth

Yes. And as you said, Game A will have to figure out a way for the NFTs in it to be usable elsewhere for it to have any value. Also as you said, the NFT is actually valuable on OpenSea right now. It’s worth money, and sometimes a lot of money! At least some of it could be speculated, but the true value is in its portability, which I think can and will be figured out, right? As more and more games come into the market, that built-in liquidity can solve a lot of these problems.

In the context of UA for a lot of these Web3 games, I’m curious how you would recommend a game dev think about the concept of LTV, given how the economics of Web3 games work.

Atif

When we used to have this discussion with our partners, we would talk a lot about what lifetime value looks like. I would always be up at the whiteboard; I would have a diamond conversion funnel, and one side was retention and the other was monetization. And it was funny because the monetization side was so important. You know, only 3 to 4% of people get monetized and you need these highly retained users to get those people to stay in the game so in turn they monetize, right?

I think from an LTV perspective, the shift will be towards retention. At the end of the day, this is a community-based open economy, and you want to drive the most engaged users to stay in the game longer, because that’s what will make them stronger parts of the community. That, in turn, increases the value of those NFTs and tokens. So retention is going to be the most important factor. And the way to retain people in this new paradigm will be around providing them value from a community perspective. Which means – how do you make sure that you are innovating to keep them in the games?

And so, while earlier, if you had been in a game and were a leader in that game, it was more like a status thing in that game. Now it’s going to be about whether you are a positive member of the community. Are you driving other people to be positive members of the community? That’s going to help innovate and keep you in the game.

So retention will be the most important part. But it’s going to be less about data points and more about understanding from those users directly what’s going to get them to stay in the game.

Shamanth

So I imagine a lot of the modeling is going to be somewhat similar to modeling of virality, mathematically speaking.

Atif

Yes. It’s like a social media app, like Facebook and TikTok, right? How to keep them in the game or app and then find a way to monetize them, versus the approach of “I have to monetize them in X amount of time or I won’t make my money.”

Shamanth

You know, maybe we’ll get to a phase where users will be aggressively monetized in a few years from now. But I don’t think we’re anywhere close to that phase just now, right?

Atif, this has been incredibly in-depth. I certainly learned a ton, as much as I have from “That Dude in Crypto” series. This is perhaps a good place for us to wrap, but before we do that, could you tell folks how they can find out more about you and everything you do?

Atif

Please head to www.stardust.gg, fill out a form and tell us more about yourself. And somebody will jump on the phone and tell you a little bit about our product. At the end of the day, our product is really built to help make it easier for game developers to integrate NFTs and tokens into their experiences. And so we’d love to tell you more.

You can follow me on LinkedIn or on Twitter for my “Dude in Crypto: series. You can live my experiences in a crypto startup, everything from what the week was like to what’s going on in this space. And Shamanth, I really appreciate you spending the time and allowing me to join the podcast.

Shamanth

Absolutely – it’s an honor. Thank you so much for being on the show, Atif. 

**

A REQUEST BEFORE YOU GO

I have a very important favor to ask, which as those of you who know me know I don’t do often. If you get any pleasure or inspiration from this episode, could you PLEASE leave a review on your favorite podcasting platform – be it iTunes, Overcast, Spotify, Google Podcasts or wherever you get your podcast fix. This podcast is very much a labor of love – and each episode takes many many hours to put together. When you write a review, it will not only be a great deal of encouragement to us, but it will also support getting the word out about the Mobile User Acquisition Show.

Constructive criticism and suggestions for improvement are welcome, whether on podcasting platforms – or by email to shamanth at rocketshiphq.com. We read all reviews & I want to make this podcast better.

Thank you – and I look forward to seeing you with the next episode!