At the end of last financial year 2017/2018, we decided to take a step back from single-player gaming and put all of our efforts into social gaming. We also identified ARPDAU, the daily earnings per player, as an area where we needed to become stronger. We have since executed our plan step-by-step and implemented what we described as our target for the coming year.
This year has largely been characterized by our strategic focus on social multiplayer games. We saw immediate benefits with the stategic investment in new infrastructure with increased standardization across the entire product portfolio.
Both ongoing updates of existing games and the development process for new games have also been influenced by our new focus. The development of new features or games takes time and thus has had a more gradual impact.
During the second half of the year, we saw positive effects in the form of improved performance of our multiplayer games as a result of greater investments in these products. Ruzzle, QuizDuel and Word Domination have all increased their average earnings per player and have also grown in absolute revenue since the beginning of the year.
A consistent theme throughout the year has been events - specific time-limited challenges or game modes with unique rewards. We have further developed these to drive engagement and the in-game economy. Various events have been successfully implemented in both QuizDuel and Word Domination during the year. Starting in the beginning of 2019/2020 events will have a clearer impact in Ruzzle as well, with the introduction of new tournament modes.
“All multiplayer games have improved their ARPDAU during the year and QuizDuel by as much as 60% compared to Q4 in the previous financial year."
In addition to in-app purchases and advertisements, we have also added subscriptions to our business model. Since spring 2019, Word Domination players have had the opportunity to buy VIP subscriptions, which gives access to unique in-game content in the game or priority for different types of events. The conversion rate from free VIP-players to paying subscribers has been high. At the same time, monthly extensions of existing subscriptions have also exceeded our expectations. The base of paying subscribers has grown steadily every week since launch.
All multiplayer games have improved their ARPDAU during the year and QuizDuel by as much as 60% compared to Q4 in the previous financial year. Since ARPDAU is a KPI where we see particularly great potential for the future, it’s positive to see such an evident development in the right direction during the course of the year.
The goal for all new games is to exhibit an ARPDAU of over $0.10 in our leading market, the US. The average ARPDAU of a global game is greatly influenced by the mix of traffic between different strong markets, which is why we use the US as a benchmark. Word Domination is currently well above $0.10 and we do not intend to launch any games that do not meet this target.
Since MAGs founding, our portfolio of games has reached over 250 million downloads. Our latest game, Word Domination, has passed eight million downloads and the leading trivia game in Europe, QuizDuel, has reached an impressive 100 million!
We continue to employ the best in the world and have seen the influx of strong profiles from leading companies in the gaming industry increase during the year. MAG is at a stage that many creative people are actively looking for - we are small enough to have a flat and agile organization while at the same time we are big enough to have a world-class infrastructure and talent pool.
Another driving force to work at MAG is a greater chance to actually create and release new games, which is becoming increasingly difficult for larger companies to offer as their threshold for what is considered worth launching is extremely difficult to achieve. We want our new games to have the potential to turn around hundreds of millions of SEK while larger companies can be forced to strive for significantly more in order to justify a game release - which means that they rarely succeed in launching something new. This places us in the ideal position to attract world-class ambitious individuals.
After investing in both infrastructure and the development process, we are now starting to reap the rewards in the form of a pipeline of products that looks exciting. When we look back on a year with the new strategy, we feel satisfied with the outcome and continue down the beaten path.
With several games releases at our back after the end of the fiscal year, we now feel confident that MAG is ready to take the next step as a company with a stable portfolio of games and revenue with the new games as a growth engine.
We have the ambition to develop games that are so great that they will be used as reference in game market analysis - we refer to these internally as benchmark games. Our latest game releases Wordzee and New QuizDuel definitely has the potential to achieve this and the products we have under development have the same level of ambition. New gameplay mechanics and combinations of categories where we can break new ground can, with the help of a strong return on user acquisition, take MAG to a global leading position in casual multiplayer.