Hacking the human brain – Irrational thinking will triple your game's revenue

hi good afternoon can you hear me well yeah thanks so how do you feel more motivated after all those lectures or he was getting feel like me like John snow no nothing I just realized I know nothing after a bunch of section I just have been so let's go forward I have like 60 60 slides so I need to go fast I came from Sofia the capital of Bulgaria we are based there this is our office three things are more three things described the company in general self-sustaining from day one never took investment we

are really flexible and independent of course this is our team a hundred tentative people so far 70% of them are developers so we can say that we have the biggest R&D department in in in the region so this is our company timeline a lot of things happen now we start in 2015 I will just go really quick on this and of course you can take photos or you can ask me to send you the whole deck at the end of the session so this is the the thing I'm going to talk about everything started in 2011 when we actually tripled the revenue the key moment here is that we managed to triple the revenue with the same amount of user database

of course this is the awards that came after this Deloitte put us on the map in Central Europe Rising Star Award for four hundred ninety-eight percent it was the fourth place in 2014 annum 2050 we were racing in the global standings in Central Europe so we took 14 plays with the revenue growth of 592 percent what you'd do with such a free cash in your hands and when you wanted to grow our approach was to build another company which is a game academy for developers we teach more than 200 not teach we teach thousands we manage to graduated more than 200 thousand people graduated

the Academy per year and of course we open outsourcing services because we became popular after having the the school and of course those kids were unable to start working on Imperia online games from day one so we started with outsourcing project just to increase their potential so this is our portfolio just for the look this is our recent title we released it's a game that we did for viber it's a core animal strategy game but because they want it to fit to their audience we make it casual with those cartoon look this is our flagship Imperia online everything in the company is built around this title it's a cross-platform MMO more than 20 million registered people and we are expert on integration so we are more than thirty social platforms Facebook even steam and

some other unpopular platforms like countries in Iran and so on as I mentioned I run wheel of diversity in Bulgaria it's really easy to find people working in house in your office that actually are native speakers you may know the customer support of supercell is run by Telus and they're based in our building so a lot of native speaking guys can be found in Bulgaria so the game is translated in 30 languages including some really non popular in the region this is how the game looks like in Europe if you never saw the game this is what we did for Russia it's looking like that nine months of the year probably if we

launched in Finland the game would be look like this as well it's too cold here and this is how the game looks like in Mena oops never mind this is how the game looks like really hard culturalization but we did it so the best thing that we do and the things that I'm going to have to talk two days and try to make you to think irrationally this is the guy that helped us a lot done early never met him in person Duke University professor of psychology a really popular book if you don't heard about him or the book I am asking you to download it now even you can find a free copy but go to amazon.com and get the

book it's amazing so we took small things from the theory of this book and the theory is that humans are not perfect we are not perfect actually we do a lot of mistakes and how to show those mixed takes to show those mistakes that we made better than the optical illusion so I will show something here is a question for you what colors are the two blocks a and B I guess you all know those optical illusions if I ask you again and you will go for the answer that a and B are the same but if we look the whole picture again you will see that you will say freely that a is dark and B is light

and I can bet everything on this as well if we do it the same if we remove the things that are distracting our mind you can see that they are absolutely identical you can take the presentation later and check from yourself that they are absolutely identical but no need I guess this is a well-known optical illusion the idea here is not to show you that you are not perfect the idea here is to show you that you didn't learn anything no matter how much you switch between two states with the destruction or only the blocks there is no possible way to unsee this illusion this is because your brain is constantly fooling you in one predictable way

so this is something that I add just to be able to explain you later what we did I call all those surrounding elements on this picture different than blocks a and B the decoy those are the elements that will help you to see the illusion yeah I said it we are not perfect why is that I think everyone will agree with me because if you take a look at vision vision we use the biggest part of our brain for to do vision we do vision more hours per day than anything else and we are evolutionary designed to do vision so if we do mistakes in vision why are you so sure that you're capable

of making financial decisions or something that you are not evolutionary designed to do this is not my words this is the words directly I took from the book so in optical illusions is really easy to demonstrate mistakes but in cognitive illusions it's really difficult so the guys that are taking care of psychology in the university they do experiments over the past years with students just to prove that we do mistakes in cognitive illusion and there are some there are things called cognitive illusions imagine if you receive a offer from me to go to a weekend in Rome all-inclusive everything paid transportation food everything or

you receive an offer to go to Paris again weekend in Paris all-inclusive everything paid transportation tickets for the theaters everything so it's a really hard decision to make it's really hard maybe half of the people we choose Italy because love pasta half of the people will choose Paris I don't know why so but what if we add the two options right if we had a third option it is it going to be even harder decision like whatever option you choose like we can in Rome we can in Paris or having your car stolen of course having your car stolen has nothing in common with the other options so nobody will

choose it and nothing will change but imagine if we had a third option that is weekend in Rome without breakfast so all inclusive everything paid transportation tickets but without breakfast so what do you think was going to happen the thing is that human brain is designed to compare stuff so once you offer weekend in Rome without breakfast people were choose wicked in Rome all inclusive in this case weekend in Rome is not only popular than the other option without breakfast but turns out that weekend in Rome is the dominated option in in your

choice your students choice that do the experiment so in this case we can call that those middle option was the decoy that forced you to choose wrong instead of Paris and this decoy was precisely designed by the guys that are asking your the question and of course they can do Paris without breakfast if they want you to choose Paris I think you start understanding what I'm talking about but later when I show the screens from the payment page of our game you will understand it clearly so this is a subscription of The Economist magazine three options again only white

pups access $59 only print copy for a hundred and twenty five dollars or you can have bought four hundred and twenty five dollars so who will choose the middle option I guess no one and it's right no one if done early and his colleagues run these experiments to a thousand students in the MIT university they show this at and they saw that sixty percent will go for the web access and the eighty five percent will go for the combo deal so nobody wants in the middle option that shows that people can read so but if you have an option that nobody wants you can remove it right so once they remove the option I run the same experiment with a thousand students this was the result the least popular

became the most popular and the most popular became the least popular so people right now will start choosing only what white boxes and majority of them were choosing the the smaller amount in this case the middle option was the decoy it was useless in the sense that nobody wanted but it was really important to put an anchor in your mind that the print copy cost 125 so you start calculating how much you are winning by choosing the combo deal right and of course if you start calculating this increased sales in weight 43% so what we did when we read this about this theory was how to create

a decoy option so this was our basic screen back in the time and everything was like normal you see those type of screens in the game 5 euro 10 euro 2014 hundred 200 and 400 bonuses start from the middle of the screen and so on so people were familiar with those so we were thinking if we add an option that is worth like adding an option Rome without breakfast is not going to work for us so we need to give more right Oh first of all we decided to put labels so we decided to focus people not on 495

not on 5 euro but to show them that a lot of guys are buying for 40 Europe so we put labels those labels are absolutely fake yeah still fake but the the result wasn't the result wasn't so good so we decide to go deeper and to use the theory and we decided to do this take a look at the the right side of the screen we actually double everything we doubled the offer but we kept the amount of money we want the same so 499 you get two caskets of resources you had double the amount of the virtual currency and

so this was the result we were happy about it drinking champagne spending already money that we don't have so we were we think that we were really clever yep so the thing is that we were limited in space oops the time is time to slow so we were limited in space so that's why we removed the 400 option and we start thinking okay we're losing money from this option there was people that buy 400 to option and we get greedy and said let's double the 400 your option so we double it it looks like this remove the 40 keep the 100 200 and double the the

400 euro option it wasn't so good actually only 200 75% this is because some of the credit card look people don't have so much money in their credit card some of the payment methods doesn't allows us to ask for more than 300 euros and so on and so on so we weren't happy but this wasn't our biggest problem we did a huge inflation of the hard currency in the game imagine you are constantly selling on promotion in long term this is not working after a month the sales top people were getting back to their usual payment and so on and so on so they flooded the game with virtual currency it was really bad so we fix it

we realize that the problem is that we gave double amount of the virtual currency so we kept the same amount of virtual currency only double the resources so this was like our this our move and it turns out it works really good not as the first time but again 310 percent increase and of course almost no side effects because again we removed the biggest package so again we get greedy and we wanted to have back the biggest package so we did dynamic strains like if you are well you already spent 200 in our game you will see the

400 package but if you are not if you are a small spender the irrational offer actually will show you on the next step that you need to take so if you buy only 420 the irrational offer you can see the double of the resources would be on 40 so yep this was the increase of the revenue versus the base and almost no side effects so by start thinking how how to become even better we take a look at the statistics and we realize that not 100% of the people are opening the payment screen right and we did something really interesting all of the daily rewards that you collect are given on the payment screen so whatever reward

we gave in the game no matter is a quest or just a gift from another player you need to go to the payment screen to receive the gift so right now hundred percent of the players because we have daily gifts are looking at the screen and this of course increases against the again the revenue so the whole idea of this thing is I don't have time I'm over over time one minute I have only one centers yeah I have one one more thing to say I had more things to say but I have to end extremes here our other speak is running a bit late so actually we got a bit more to heart okay okay okay your catch characters got another good so I

wanted to tell you two things now the first thing is that never stop optimizing those don't screens as I can show you in the my in my last my last five slides we also need to optimize the screen this is a screen shots not update there wrote so we are still changing the screen and the other thing a lot of companies do sales like first offer or flash sales if you open the games like play on machine zone you enter the game and see they have three packages 10 euro 20 euro 50 euro so if you if you offer 10 euro 50 euro but not good awards not good items and 50 euro with great items

you will have more sales then if you offer 10 20 50 so the whole idea is to move people attention from the left side to the right side because if you have if you want to have different payment packages to be able to give the chance to the people that don't have money to buy something sometimes you lose those who are ready to buy for 200 euro and they will go to buy for 20 just to try it and they they will if you like it they will buy for 200 if you are many if you manage to move the attention from the first package to the last package this is the things that we do people will start asking questions why they give the same amount of money why they give

double resources for the same amount of money they think that we did mistake they bought it but in the second that they start discussing this they already forget about 5 euro 10 euros when you're right they just start focusing on those packages for 200 or 400 so this is the whole idea and why this is working so I just wanted to say something if you take a closer look at the slides that I just showing you will see that our price tags are not are not perfect so yeah I had a story here if you go to the market and want to buy for example jam or something that you don't you are not familiar with how much it costs you go to the shop and see gem for to

ten for ten and Jen for Jen for 35 euro I never go with the two euro gem my grandmother will think I'm cheap so it turns out that it's not only me 80% of the people will choose the middle option so here is a great idea for the guys that sell gem or like us the guys that sell gems or diamonds or anything if you just increase the middle option with five euro it actually will bring 35% more revenue at the end of the month yeah I put those right here just to just to to say that everyone has money in his

hands in his mind and we used to work with money so these are the best anchors for the price tags that we can use in theory online we still use 40 euro payment instead of 50 I don't know why but it's a clear mistake so if we change those 40 to 50 we will have huge increase in the revenue without losing any people that were willing to pay 40 but not 50 people are used to think as like 10 20 50 100 200 that's it thinking is incredibly important I mean the the example I love is the Hershey's kiss

versus Lynn choctaw have you heard that one yeah so it's just going a bit but this idea of free or paid it's a bigger decision yeah don't whether it's $20 or $30 yeah you know people's willingness to pay when we were running the mobile operator 3 in the UK we went up in price from 5 pounds for a full price game to 6 pounds when we had more sales yeah sure and basically the same and in our case it was because we were offering 6 pound then six weeks later reducing it to three and then six weeks later reducing it to one and then taking the game off the deck and we found that was an incredibly powerful I'm actually very ordinary retail strategy that works everywhere else and I think a lot that's what I find really interesting is a lot of this stuff is available everywhere in everyday life we see this happening yeah a lot of retail stores are using these techniques a lot of every every

kind of business is used every kind of business area whether it's holidays cafes you name it it's it's Valley River so watch thank you