How can Supercell balance monetization through in-app purchases with maintaining a fair playing field for free users?

Introduction

Balancing monetization through in-app purchases with maintaining a fair playing field for free users is a critical challenge for Supercell. This trade-off directly impacts user engagement, retention, and revenue generation. I'll analyze this problem by examining the product ecosystem, identifying key metrics, designing experiments, and providing a data-driven recommendation.

Step 1

Clarifying Questions (3 minutes)

• Context: I'm thinking about Supercell's game portfolio. Could you specify which game(s) we're focusing on for this analysis?

Why it matters: Different games may have unique monetization strategies and player bases. Expected answer: Clash of Clans or Brawl Stars Impact: Would tailor the analysis to the specific game mechanics and player expectations

• Business Context: Based on industry trends, I assume in-app purchases are a primary revenue stream. What percentage of revenue currently comes from IAPs versus other sources?

Why it matters: Helps quantify the importance of IAPs to the business model Expected answer: 80-90% from IAPs Impact: Higher percentage would emphasize the need for careful balancing

• User Impact: I'm considering the player segments. What's the current split between paying and non-paying users?

Why it matters: Understand the potential impact on different user groups Expected answer: 5-10% paying users Impact: Lower percentage of paying users might require more focus on retaining free players

• Technical: Regarding game balance, are there any technical limitations in implementing dynamic difficulty adjustments?

Why it matters: Affects feasibility of potential solutions Expected answer: Some limitations exist but adjustments are possible Impact: Would influence the complexity and timeline of proposed changes

• Timeline: Is there a specific timeframe we're working with for implementing changes?

Why it matters: Determines the scope and urgency of the solution Expected answer: Next quarter or within 6 months Impact: Shorter timeline might prioritize quick wins over long-term structural changes