The ASA has banned misleading ads from Playrix’s Gardenscapes. Running the same creative in user acquisition hits diminishing returns fairly quickly as the creative “clears the market” for users attracted to that creative. To broaden appeal, why not simply advertise the game as existing in a entirely different genre? This opens up a whole new segment and drops CPIs significantly. Of course, advertising gameplay that doesn’t exist surely means these users will exhibit extremely poor KPIs. However, there’s a broader implication to these ads and one that harms the entire game industry.
The harm is described in Akerlof’s Nobel Prize winning paper on car lemons:
Akerlof’s original example of the purchase of a used car noted that the potential buyer of a used car cannot easily ascertain the true value of the vehicle. Therefore, they may be willing to pay no more than an average price, which they perceive as somewhere between a bargain price and a premium price. Adopting such a stance may at first appear to offer the buyer some degree of financial protection from the risk of buying a lemon. Akerlof pointed out, however, that this stance actually favors the seller, since receiving an average price for a lemon would still be more than the seller could get if the buyer had the knowledge that the car was a lemon. Ironically, the lemons problem creates a disadvantage for the seller of a premium vehicle, since the potential buyer’s asymmetric information, and the resulting fear of getting stuck with a lemon, means that they are not willing to offer a premium price for a vehicle of superior value.
If users start to have an expectation that a given game ad does not truthly describe the game in question then they’ll be less likely to click. This means higher UA costs even if your firm does not engage in these type of ads.
A similar problem is starting to creep up in PvP games. Developers have started to be confronted with the uncomfortable reality that PvP is a zero-sum game: for someone to win, someone else has to lose. And of course, when players cannot progress they churn. Supercell has heavily introduced bots in Clash Royale as a response.
Of course, players cannot identify if they are indeed playing a bot or a real player. This steals one of the compelling aspects, if not the compelling aspect, of PvP away from players: outsmarting another individual. But like the lemon problem above, if this trend continues then players will start to question if they’ve dominated a real opponent even if the particular game doesn’t use bots. Games that use unmarked bots start an industry expectation that diminishes the experience for all.
There’s a good moral rule here to help us and it’s from an 18th century philosopher called Immanuel Kant. Kant advocates for something called the Categorical Imperative. This claims that if we were to universalize a given action and it would result in a “contradiction” then that action is immoral. Consider lying: if everyone were to lie then the world would not function, therefore lying is immoral. Or consider being lazy: if everyone were lazy then nothing would get done. It’s a no-holds-barred approach to consider moral action, but thankfully we’ll use it a much more narrow scope.
If unmarked bots were to be universalized, PvP games would be irrevocably harmed. If misleading ads were to be universalized, then players would stop clicking on them all together. Both of these situations violate the Categorical Imperative and align with outcomes that benefit the entire industry. The Categorical Imperative makes for a simple and rule based approach to consider the “greyer” parts of developer action.