Published on February 18, 2014
Product Manager - Interview Test Case Siddharth Sriram PGP18 150 Mudra Institute of Communications, Ahmedabad
Question 1 Pick a Top 10 Facebook game and play it in some detail. You can find the most popular games at http://www.appdata.com Based on the game you chose: A. Identify and describe the core game loop. Core game loop is defined as the main set of features that drive the players progress forward B. Describe how the game uses micro transactions to drive the revenue. For example, in what features or at what points in the game are you enticed to spend real cash ELECTRONIC ARTS
Game Chosen - CityVille Game Statistics Daily Active Users - 1,700,000 Monthly Active Users - 29,500,000 Weekly Active Users - 8,200,000 CityVille 2 is a casual social city - building simulation game in 3D that is story-based, with a mystery that unfolds as the player’s city evolves. Players take on the role of a mayor out to revive a virtual city by guiding the creation of businesses, museums, homes, etc. where online friends can help build one another's cities. Currently the third most played game on Facebook – only behind Farmville and Texas HoldEm Poker Source - Appdata ELECTRONIC ARTS
1.A Analysis - Core Game Loop Game Mechanics Amplify User Motivation through story progressions, personalization and better challenges Social Actions •Help Build Friends’ Cities or Get Help from them Gift/ Request Items Perform Actions User Motivations Involved • Curiosity •Drive for Power • Social Status • Sense of Achievement & Belongingness • Collect Citizens/Builders • Rebuild City Structures •Collect Revenue from Businesses •Expand into Districts Get Rewards •Coins, XP • Currency •Building Material •More Resources •Better Reputation Objective •Build Own City • Personalize properties For self expression • Uncover the bombing mystery Outcomes Reputation/Level ups, Quests, Story Progression ELECTRONIC ARTS
1.B Driving Microtransactions Cityville2 is definitely less micro-transaction intensive than Zynga's previous incarnations, as nearly everything in this game can be gotten with using manufacturing plants and other support buildings, to create what you need to build the buildings you need. However, the following features would appeal to certain player types with potential to monetize that look to make use of different player motivations. Consumables Players pay in exchange for coins, XP points and/or more energy for game play. Typically used when players cannot wait to advanced to the next level or continue with game play. Golden Keys To buy more premium game items, finish quests more quickly and make it easier to build, craft and collect revenue from businesses. Personalizations Players pay to select neighborhoods, holiday and decoration items. This is due to the prospect of presenting unique city establishments owned by them to their friends which gives them sufficient bragging rights. Story/ Quest Progression The game employs an engaging storyline where people can pay to advance the story if they are feeling impatient. They feel a sense of progress when completing quests and will pay to overcome roadblocks in that progression. ELECTRONIC ARTS
Question 2 Write a light specification for a feature, which drives either retention, monetization or DAU .A spec should use both words and excel/pictures/flow charts/drawings/storyboards. Areas to cover in the specification: Business Case Why we are doing the feature? How will it contribute to retaining/monetizing/ DAU? How it works Flow, Mechanics & Rules Communication channels used -What opportunities does the feature give for players to share their achievements, progression with their friends -Ask for help to complete tasks in the game -Others Promotion of feature How would we tell users about it when it first launches ELECTRONIC ARTS Stats tracking Which metrics and data points do we need to track in our analytics system to measure the success or failure of the feature
2.A Feature Spec - Business Case User Personalization Layer - Create a “personalization layer” that creates an immediate emotional connection to the game content by taking the players’ friends’ profile pictures and mapping their faces onto in-game characters’ bodies. This transforms the existing social network data into relevant game content to take on ultimate meaning for players. Custom character creation features from any photo by the user also add to the experience. Sample Illustrations from ZombieFace - Provided by Gameplay.me ELECTRONIC ARTS
Feature Spec - Business Case 2.A Excel Modeling – This application layer must drive up retention numbers as shown in the sample prototype below Table1 Still Player at end of Day1 Day2 Day3 Day4 Table 2 Still Player at end of Day1 Day2 Day3 Day4 Daily Retention Graph Before Feature Application Date of initial subscription Day1 Day2 100.0% 52.0% 55.0% 49.0% 95.0% 59.0% 47.0% 43.0% Day3 94.0% 49.0% 45.0% 43.1% Day4 Day5 Day6 Day7 93.0% 94.0% 94.0% 92.0% 50.0% 52.0% 53.0% 47.0% 51.0% 44.0% Daily Retention Graph After Must improve second day retention Feature Application by a factor of 1.2 to 1.5 ie ( 62 to 78%) Date of initial subscription Day1 Day2 Day3 Day4 Day5 Day6 Day7 100.0% 75.0% 72.0% 70.0% 95.0% 71.0% 57.0% 53.0% 94.0% 69.0% 55.0% 53.1% 93.0% 94.0% 94.0% 92.0% 60.0% 62.0% 63.0% 57.0% 61.0% 54.0% Why do we need a Personalization Layer? According to Gameface.me’s data, if a title manages to become popular enough to draw in a large audience for a day, the title will only retain 50% of its users on Day2. The numbers will continue to decline, and by Day 30, only 15% of users are expected to stay around. Similarly at the end of Day 30 at least 35% of the original user base should be retained by the feature. ELECTRONIC ARTS
2.B Why and How Does it Work? So how does this feature Improve Retention? By enhancing gameplay and user experience, such a layer forms a deeper level of emotional connect and has great potential to drive greater retention by reducing churn drastically. Greater Personalization -> Invite More Friends to Share the Fun -> Sense of Community & Greater Immersion in GamePlay -> Users Keep Coming Back and Encourage Friends to-> Improved Retention Flow, Mechanics and Rules Used Mechanic – In Game Player Personification according to Social Data and User Customization Rules – Maps existing social data to create in game friend player personalities. Custom character creation also possible by users to create game characters from any photo. Thus it becomes possible to play with not just friends in the game but also favored celebrities or even their least favorite ones. Flow – Better emotional connect results in a much more immersed activity and optimal flow. ELECTRONIC ARTS
2.C Communication Methods Used 1. What opportunities does the feature give for players to share their achievements, progression with their friends? • The personalization will compel users to send updates to friends each time the user decides to feature their photo in the game • Personalized updates on users’ walls for each activity, for eg In the case of ZombieFace (a game where players kill zombies wearing their friends’ faces), the game generates a post saying something “Scott killed Mike!” on Scott’s wall, which is visible to both Scott, Mike and their friends. The post piques the curiosity of these friends to click on the update and eventually join in the activity. 2. What opportunities does the feature give for players to ask for help to complete tasks in the game? • There are no additional opportunities created due to this feature. The feature only serves to amplify already existing social interactions. For example, visits to each other’s farms on Farmville will still continue but will be amplified now, since the players will look and feel more like their real life persona. ELECTRONIC ARTS
2.D Status Tracking Stats Tracking The feature is added with the objective of driving retention and engagement activity as players are more eager to see themselves and friends being part of the story. Hence the following list of metric will need to be tracked to measure its success Is there a significant increase in the below parameters for the new feature users? (after A/B Testing between new feature users and non users in a month’s time frame) Measuring Retention • Reduction in Daily, Weekly and Monthly Churn Rate (% of Users Leaving within a Stipulated Period) • MAU and DAU Activity • Average Time of GamePlay Activity by User in a Month • Average No. of repeat Visits by User in a Month • Reduction in Average Time between Subsequent Visits per User Engagement • Game Stickiness - DAU/MAU Ratio (% Use in a Month) • Total No. of Different Game Actions performed • Rate of increase of total New Feature Installs • Increase in amount of Social Interaction Activity (gifting, visiting farms etc) ELECTRONIC ARTS
Question 3 Let’s say you are running a farming game like FarmVille. Below is a set of situations that you might run into while running it. Describe some MARKETING ideas you have that could deal with each situation. For example, to increase revenue, you may run Holiday themes like Snowy Christmas in FarmVille and sell special snow items. A. The conversion to paid user rate is low. What would you do to increase conversion rate B. You find out that if a user buys 2 or more times, it is more likely they will continue buying. Most users pay only once and then never buys again. What would you do to try and get people who bought once to buy more? C. The ARPPU is low. You need to try and increase spending per user. ELECTRONIC ARTS
1.A Increasing Conversion Rate to Paid Users First time Buyer Deals Commonly used by ecommerce sites, a first time buyer incentive must give players a ‘deal’ that gives them x dollars to be spent only on Farmville purchases. A loss aversion mindset and optimal pricing would mean that they would be unwilling to lose the opportunity and spend a little extra along with the deal money to make a purchase. Farmville Daily Draw for Buyers A user becomes eligible for the Farmville Daily Draw if he makes any microtransaction above a certain denomination (say $2) within a pre decided time frame everyday. There would be assured deals (from Farmville and/or Partners) and one bonanza prize for the day. A random ticket number selected everyday at a local and global level. This would entice non paid users to make the first purchase and others to do transactions more often. Localization and Cash Cards Personalize pricing to local currency (eg show prices as Rs in India) instead of in $ everywhere to make pricing more relevant. Cash card sales for Farmville microtransactions (akin to telecom recharge vouchers) at retail outlets would enable non credit card holders to buy more often. ELECTRONIC ARTS
1.B Increase Second Time Purchase by Users Farmville Repurchase Coupon On their first ever microtransaction on consumables and/or personalization, users must get a limited offer promotional discount code for use in subsequent Farmville transactions. It has been a fairly successful tactic employed by pizza delivery services which always provide you with a limited offer discount coupon for any subsequent order to drive repurchase loyalty. Crowdsourced Payments between Second Time Buyers For any multiple no. of friends who have made one purchase each on Farmville before, suggest to one of them if they would be willing to share the subsequent purchase on Farmville consumables with their friends. Therefore friends finding themselves in the same buying cycle will aid each other in the decision making process. Also the resulting reduced denomination of individual transaction through crowdsourcing will increase purchase intent. ELECTRONIC ARTS
1.C Increasing ARPPU Farmville Awards A Half Yearly Competition at a National and Worldwide level where the winners (based on levels, XP etc) will be given celebrity - like promotions on FarmVille and in the traditional press, inviting them to visit the Zynga office, meet with a celebrity etc. This looks to tap into the already existing user’s desire for status and recognition. This increased competition would result in a greater number of players now looking to buying more consumables and advance more quickly. Exclusive Limited Edition Bundled Offers A level of personalization and exclusivity in the offers being promoted will result in greater purchase intent at a user level, thus resulting in greater ARPPU’s . The channels for promotion could Either be display ads, Fb ads or by email. ELECTRONIC ARTS
Question 4 You are appointed as the GM of Simple Corporation. You are responsible for steering this company to high levels of growth and profitability. On day 1, you’re pouring through the historical results of this company. This is the first report you see. A. What are the questions in your mind after looking at this simple data. What other data would you like to access, leading from this sheet to drill down into this business further? B. Who would you call to get more data. Assume you have a directory of all the people who work in this organization across various levels and you have the ability to make 5 phone calls on your first day. But remember, you have only 5 calls today before your Golf session begins. Dont waste them! Prioritize! C. What are the risks and opportunities that come to your mind with this data alone? List a couple bullet points on both risks and opportunities. ELECTRONIC ARTS
4.A Data Analysis Demand Falling Consistently since 2009 Improved SP increasing Margins Widgets Profit (in '000) Profit Margin (in %) $58,500 $23,400 40.00 $18 $75,600 $25,200 33.33 $53,200 $18 $68,400 $15,200 22.22 $13 $48,100 $19 $70,300 $22,200 31.58 $13 $45,500 $20 $70,000 $24,500 35.00 Blended cost per COGS (in Selling price per Revenue unit (in ‘000) '000) unit (in ‘000) (in ‘000) Year Units Sold 2008 3900 $9 $35,100 $15 2009 4200 $12 $50,400 2010 3800 $14 2011 3700 2012 3500 Consistent Increase in demand Consistent Increase in cost/unit Trinkets Degrading Profit Margins over the Years No SP Increase Profit (in '000) Profit Margin (in %) $30,000 $17,500 58.33 $12 $33,000 $16,500 50.00 $24,500 $12 $42,000 $17,500 41.67 $8 $36,000 $12 $54,000 $18,000 33.33 $9 $45,900 $12 $61,200 $15,300 25.00 Blended cost per COGS (in Selling price per Revenue unit (in ‘000) '000) unit (in ‘000) (in ‘000) Year Units Sold 2008 2500 $5 $12,500 $12 2009 2750 $6 $16,500 2010 3500 $7 2011 4500 2012 5100
4.A Data Analysis Low Margin Product Sockets Blended cost COGS (in Selling price per Revenue per unit (in Profit (in '000) '000) unit (in ‘000) (in ‘000) ‘000) Profit Margin (in %) Year Units Sold 2008 1200 $15 $18,000 $16 $19,200 $1,200 6.25 2009 1800 $14 $25,200 $17 $30,600 $5,400 17.65 2010 2400 $13 $31,200 $14 $33,600 $2,400 7.14 2011 2750 $13 $35,750 $14 $38,500 $2,750 7.14 2012 4000 $12 $48,000 $13 $52,000 $4,000 7.69 Rapid Increase in demand Consistent Discounting on Selling Price ELECTRONIC ARTS
4.A. I Data Leading to Questions 1. What markets and segments do we cater to through our Widget, Trinket and Socket offerings? Who are our customers and how are their needs evolving? 2. What is competition doing and where do we stand in terms of overall market share, segment wise market share and YoY growth relative to them? 3. What is the exact cost structure (under blended costs) for each of our products under the following heads? - R&D Cost - Production Cost - Marketing Costs - Sales and Distribution Costs Are we overlooking any process inefficiencies? Where can the costs be reduced to improve margins, especially for widgets and trinkets? 4. Were there inaccurate forecasts in these five years that resulted in significant inventory wastage/ shortage through over/underproduction? What is the forecasted demand for widgets, trinkets and sockets over the next five years? ELECTRONIC ARTS
4.A. II Data Leading to Questions 5. Why is there a consistent slowdown in demand for widgets since 2009? Is it the result of - An overall segmental slowdown - A new, better offering by competitor(s) - Increase in widget prices when compared to competition - The offering being no longer relevant (ie Customer Needs have Evolved) 6. Why has the selling price/unit for trinkets stayed the same for 5 years (at $12) despite increasing blended costs and eroding profit margins? How can the consistent increase in blended costs/unit be curtailed & reduced? 7. Why is the selling price of our sockets being slashed consistently since 2009? What is our position when compared to competition here? Do we have any product superiority that allows us to raise prices a little to improve margins, without affecting demand or being affected by competitive offerings? 8. Is there business opportunity for new product development or expanding into newer segments and markets profitably? ELECTRONIC ARTS
4.B Whom to call for Information Clarity? The following calls will be made in the decreasing order of priority from top to bottom :• Head of Marketing - To find out the how our offerings are when compared to competition according to TG, track evolving customer habits and identify the most loyal ones. •COO – To get a macro view of operational challenges and the overall cost structure (R&D, Production, Sales, HR, Distribution, IT whichever applicable) for each offering. • Production Head – To figure the accuracy of demand forecasting for each unit in the past and the reasons if any. Also review future demand forecasts • Head of R&D – Possible innovations that could result in refined/new product offerings for customers or reducing production costs resulting in improved margins. • Head of Sales & Distribution – To find warehousing, transportation costs and the channels being used to reach different customers ELECTRONIC ARTS
4.C Possible Risks and Opportunities from Data Opportunities Risks Good top line growth due to consistent increase in demand for trinkets and huge growth in demand for sockets Blended cost/unit for trinkets has been increasing and if not curtailed, might erode profit margins completely in the next few years despite the increasing demand. Significantly improve profit margins on trinkets and sockets by reducing blended costs/unit through economies of scale Wrong demand forecasting for any of the offerings resulting in huge unsold inventory and heavy losses
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