Besides the final value of the figures, what I am interested in is to think together about the economic model and the escalating dynamic of the business.

ARPU X Time= LTV

taking into account these values, we have to multiply the ARPU of each site by the average survival time of an active user to obtain the LTV or life time value of each one.

If for example, a user of Habbo is in average a year in the site, Habbo may assume that the LTV of its users generates $15.6.

Acquiring user’s campaigns

With this hypothetical number in mind, LTV: $15.6, they have to plan and asses the acquiring user’s campaigns.

This campaing to keep them “healthy” should have as a target to capture new users at no more than $3.90 (3 months of revenue as an investment) and the difference against the LTV should be the expected ROI on capturing a user.

The acquisition cost of a user is called CPA

CPA < LTV => +ROI

If the acquisition cost of an active user is lower than the LTV, the ROI will be positive.

It is obvious that at the first time it should be invested on capturing users to generate a loss, but as a regime this is not healthy.

Fidelity campaign

A program of fidelity campaigns should be planned which objective were to increase the LTV value, making the user to generate more many or to stay longer.

The ROI of this campaign and the investment amount have to be related to the impact on the variation of the LTV (it can increase or decrease if you stop doing it) depending on the user base that you have.

To give an example on this last point, building a fidelity campaign you can extend the service usage by 10%, but if you user base is still too small to generate an ROI on the campaing, it might be better to invest on capturing than on fidelity.

Other actions that can be done and that most of the times are postponed are the Winback actions that focus on bringing back the clients that you lost. This type of actions are very important, not so much for the direct ROI that it can have as much as for the direct data that allows you to understand what happened to those clients and to try to improve the experience based on that info.

Another important point is that all these metrics (LTV, Time, CPA) are fluctuating so we need to monitor them the same way you follow and index or a stock market quote.

As a conclusion we can see that the MMOGs have a business model that has a growth potential and we will see many acquisition campaigns based on this economy that we have just explained.

Taking this into account: Do you know the value of your users or your clients?