Three pillars of free-to-play monetization
Hi. My name is Sergiy Galyonkin, and for the past twelve years, I have worked on free-to-play games, including most recently at Epic Games, where I spent eight years helping the company launch and monetize Fortnite: Save the World and then transition it to a free-to-play Fortnite: Battle Royale. I was part of the original publishing and monetization teams, working with incredibly talented people to develop the rotating cosmetics store and the modern battle pass.
This article describes my way of thinking about monetization. It is not a guide to monetizing your free-to-play game, but this approach is helpful when analyzing other products and developing a strategy for a title.
This is the model I’ve used since working at Wargaming (even before Epic Games) — so depending on how you look at it, it’s either outdated or has stood the test of time.
Three pillars
In my monetization framework, I categorize items and mechanics into three pillars:
- Social — things that affect the experience of playing with others. Player-driven marketplaces, party/server boosts, emotes, and anything else a person could share with friends.
- Utility — gameplay affecting items and mechanics that make the game more convenient, deeper, and different. Extra inventory slots, timer skips, new characters/heroes, quests, battle passes, etc.
- Vanity — anything that makes the user stand out: cosmetic items, ranked rewards, badges, achievements, and so on.
You can use the “SUV” mnemonic to remember them.
Many items and monetization strategies will likely incorporate two or three pillars — that’s great! You want one item to attract as many users as possible so you can simplify your offers and keep the game’s monetization transparent and fair.
Yes, there are specific types of games that are based around complexity, and they tend to attract players who enjoy min-maxing both in the game itself and the game’s store, but outside of them, most players want to have fun and not overthink choosing the right offer. Don’t make your title’s monetization strategy look like health insurance packages in the US.
Social
Let’s begin with the most under-utilized pillar of all three, social, is what changes the experience of playing together or versus other people. In some sense, you could consider vanity items social, too — after all, if nobody sees your cool skin or achievements page, do they even matter?
An obvious (and difficult to implement) example is a player-driven marketplace or economy. If players can buy and sell certain items for real money (or hard currency), it will affect their perception of value and time spent obtaining them, not always positively. Say, if a particular resource needed to level up skills costs $1 or requires two hours of gameplay, some might feel they would be better off paying for it, even though it means skipping two hours of the game they like enough to spend money on it.
And then there is EVE Online, which thrives on having a player-driven economy, politics, wars, and everything else.
Even when it is one step removed through an intermediary currency, introducing money often breaks the perception of the earned item’s value because it’s suddenly compared not against the in-game counterparts but with a cup of coffee or a burger in the real world. You want your players to have fun playing the game and not feel like they’re working a sub-minimum wage job.
Emotes are a big social category — while they allow for self-expression and could count as vanity items, they’re often used to communicate with other players, especially on the enemy team. Players emote almost exclusively when others can see them, and in some games, it’s even customary to answer with the same or similar emote. Fortnite uses it well with their synced emotes.
Emotes also tie incredibly well into the TikTok and Instagram Reels-driven zeitgeist, allowing users to express even complex emotions using dances and gestures from popular media and influencers. If you’re Internet-old, consider emotes as GIFs for the new generation.
There are also boosts, which aren’t as popular in Western games as they are in Asian. One typical example is team boosts (like in League of Legends Wild Rift) that give everyone 10% more XP and soft currency in case the team wins. They usually can be combined (but not stacked), too. But these boosts matter more in progression-based games. Asian games sometimes have server boosts attached to player skins or weapons, so a person with a flashy gun in a first-person shooter game would grant extra XP to their teammates and enemies.
And, of course, I can’t skip over battle passes and event tickets, often being great social monetization tools. If all of your party is doing a battle pass quest, you will be way more likely to purchase the battle pass, so you don’t miss out. You could do everything they’re doing and still have a lot of fun without it, but having a checkbox to tick and a potential reward to earn usually makes the battle pass worth it.
The weekly structure of most battle passes is great for social engagement and re-engagement, too — there is a lower risk of a person who plays less often than everyone else falling behind their friends. And sometimes a battle pass might be designed in a way that hurts social engagement — if the weekly quest in your game is to play support, it’s more likely to break up friend groups than to help them stay together.
Utility
Items and mechanics that affect how a game is played belong to this pillar — from making progress faster to additional quests in battle passes to overpowered pay-to-win items and mechanics.
I don’t need to tell you that pay-to-win mechanics, especially in competitive games, are a terrible idea — players generally hate them, and they tend to hurt long-term retention for most cohorts.
Progression-based games (many mobile titles fall into this group) often get away with charging their audience for gameplay-affecting items. While their players are usually OK with that, there is always a risk of turning a free-to-play game into pay-to-play, negating the core benefits of the business model. This applies to monetized maintenance mechanics like durability or repair costs, too.
There is nothing inherently wrong with pay-to-play free games — many TCGs become like that once you reach a certain rank. But it comes at the cost of lower conversions.
Some of the most apparent utility-based monetization strategies are new characters, cards, extra storage slots, shorter timers, XP boosts, and special items. Many gacha-style games contain utility items like heroes, cards, or resources needed for upgrades in their loot boxes. But a battle pass can also belong to this pillar, depending on how many extra activities it provides to the players.
A typical battle pass usually has a list of tasks players must complete to level it up. While the rewards for completing those tasks are the most obvious benefit, the tasks themselves can be a big reason for increased player satisfaction and retention. And because they tend to restart from scratch every few months, battle pass-driven seasons provide natural points of re-entry for lapsed players.
Well-designed quests will have users going slightly out of their comfort zone, doing things they would not typically perform — like visiting a high-risk, high-reward location on the map or completing a series of challenges with a different character class.
It is a delicate balance — make the tasks too aligned with regular gameplay, and users will feel like nothing has changed. But making them too different might force players to do things they hate, hurting satisfaction and retention. This might be particularly harmful in competitive games, where these actions affect their teammates, leading to players hating anyone trying to complete their weeklies.
Of course, rewards in a battle pass are also a big part of its appeal to players, and that’s what most companies advertise when promoting it, which brings us to the next pillar.
Vanity
Anything that allows your players to express themselves and stand out. Traditional cosmetic items and customization options are a big part of this pillar, but it includes other things.
For example, free-to-play games often include hard-to-get cosmetic items that require a certain amount of playtime or skill — think about the last skin in a battle pass or an unlockable modification of that skin that requires the player to grind quite a bit. Tournament and competitive seasonal rewards (like trails and special effects for spells in League of Legends Wild Rift) also belong to this pillar.
Overall, vanity is about expressing one’s creativity, style, dedication, and skill. You’d want the flashiest items for the first two, especially if they’re directly monetized. Fun, expressive skins that make a user stand out work well for direct or layered purchases. The same goes for anything tied to an external IP, allowing users to express their love for a particular movie, anime, or show.
But if you’re considering items to showcase dedication and skill, understated and subdued cosmetics often work better and contrast the grandeur and kitsch of directly paid items. For years, Fortnite’s two most intimidating outfits were a simple knight in black armor and a bearded guy in a suit — not a walking banana or a toon-shaded cat bodybuilder. And that’s because those were harder to get, so players naturally (and rightfully) assumed that anyone wearing them had played the game for quite some time.
Scarcity is a big part of the appeal for vanity items. The easiest way to achieve scarcity in free-to-play games is to control the window when an item can be acquired through rotating store inventory, time-limited events, and passes.
Loot boxes are another way to make items artificially scarce (Overwatch used to do that), but they tend to feel punishing and exploitative. Some games try to control the supply by limiting the quantity of each item available for purchase. I have yet to see an example of this working without leading to player frustration and the perception that the game is tilted toward high spenders, although it seems more accepted in some regions than others.
In Western PC and console games, vanity is the most apparent and well-known pillar, and most players are comfortable with this type of monetization.
When developing vanity-based items, remember the gameplay aspect instead of focusing purely on paid cosmetics. Players value earned cosmetics a lot, and anything they had to work for is considered earned, even if there was an initial purchase — like a battle pass, an event ticket, or even an original item they get to level up.
When done right, vanity-based cosmetics will increase the game’s revenue, make it more fun for the players, and improve game satisfaction and retention.
But what about other things?
You might have noticed that I mostly talked about in-game mechanics and items without mentioning conversion strategies like special offers or introductory daily drops. I also haven’t spent any time on loot crates or subscriptions.
That’s because they are, while important, delivery mechanisms for what your players want from the game. You might sell your skins (heroes, emotes, resources) in the permanent or time-limited (or even access-restricted) store; put them into loot crates or behind a subscription. But what you sell and what you monetize is most important. A game that sells power-ups outright will continue being pay-to-win if those power-ups are now locked in limited drops or are part of a monthly subscription tier.
Not to say that the special offers, events, or other sales tactics don’t matter — they do and matter a lot. But when analyzing a game, I prefer to start with understanding what it sells before proceeding to how it does it. Sale strategies warrant a separate article.
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