Importance of Data Driven Approach to Manage Digital Businesses

© Play Games24x7 Pvt. Ltd.
Importance of data driven approach to
manage digital businesses
12th January, 2015
Sachin Uppal, Marketing Director
Play Games24x7 Pvt. Ltd.
www.RummyCircle.com

“You can’t manage what you don’t
measure.”
W. Edwards Deming and Peter Drucker

1. Data driven online businesses
i. Online business definition
ii. Data driven approach
iii. Key online business components
2. Culture of Analytics
i. Why the data driven approach?
ii. Business intelligence structure
iii. Optimization, Behavioral Learning, Big data & Predictive Analytics
3. Importance of Measurement – Case Studies
i. Acquisition – Consumer Behavior and Preferences
ii. Product – Design, Pricing and Revenue optimization
iii. Retention – Big data driven predictive analytics
iv. Risk Management - Process Automation
4. Future Trends
Agenda

A business or Non-Profit organization that sells its products and services on any
digital delivery platform (like: Website, Mobile, Tablet, Digital TV etc.) where
product / service content is delivered through internet.
• Case in point, Play Games24x7’s Online Rummy game business,
RummyCircle.com, where the service is delivered online.
P.S.: I have limited the definition to a fairly tactical one to keep things in perspective. I am not covering, corporate social
responsibility, impact on environment, impact on lives of people and world peace at this moment.
1.1 Online Business Definition

Case in point – RummyCircle.com
RummyCircle: India’s
best and largest online
rummy site
3 offices, 160
employees
Funded by Tiger GlobalCash positive and
growing!
We are hiring!

“How” matters!
Source: Dilbert.com

1.2 Data Driven Approach

1.2 Data Driven Approach
• Business Objective: Based on our strategy, we set a business objective. This is also based on
past data of what works and what doesn’t.
• Analysis: We break down the business problem by looking at the relevant data.
• Hypothesis: Basis our analysis, we come up with Hypothesis that could explain the behavior.
• Experiment: We setup experiments to test our hypothesis.
• Outcome: We measure the results and report our outcomes.
• Insight: We learn from the outcomes.
This process is repeated and we continuously improve our business decisions and outcomes.

Key business components from growth perspective:
• New User Acquisition - New players through attractive campaigns
• Product Design - Provide a wholesome Rummy experience
• Payments – Seamless multi-option payment mechanism
• Retention - Innovative offers and promotions
Focus on Customer service components:
• Customer Delight – Low Turn-Around-Times
• Smooth Operations – Time bound delivery / on -schedule
• Risk Management – Safe, fair, low risk - enhance consumer trust
1.3 Key Online Business Components

Business
Intelligence
Engineering
Acquisition
Risk
Management
Operations
Customer
Support
Retention
Product
2. Culture of Analytics – Across Business
Data exchange
• Data helps in making Fact /
Evidence based decisions.
Faster and more accurately.
• It’s no more an activity or
department, it is the Culture.

2.1 Why Data driven approach?

Business
Intelligence
Engineering
Acquisition
Risk
Management
Operations
Customer
Support
Retention
Product
2.1 Why Data driven approach?
Data exchange
Facebook Ad 1
or Ad 2? Green
or Red colour?
Limit Rs. 1000
or Rs. 5000?
Tournament at 9
PM or 10 PM?
I responded
within 2 hours!
How much bonus
to whom? Rs. 1000
or Rs.200?
2 Steps or 3 Steps?
4 options or 5?
Add 2 or 3
servers? Tech. 1
or 2?

2.2 Tools and Techniques
Source: Dilbert.com

2.2 Tools and Techniques
Below are some standard tools and techniques we employ on an ongoing basis:
• Behavior or Preference measurement - A/B Testing
• Look for Statistical Significance – for complete funnel
• Monte-Carlo Simulation (smaller data samples)
• E.g.: Acquisition and Product tests.
• Regression Analysis
• Predicting Y with variables X1, X2, X3… Xn
• E.g.: Display advertising has an impact on brand search volume.
• Big Data
• Predictive models based on real-time events and / or past data for real time actions or predictive outcomes.
E.g.: Retention case study.
Image Source

2.3 Business Intelligence Structure
BI enables the business to make intelligent, fact-based decisions

2.3 BI Structure Contd.

1. Acquisition – Consumer Behavior and
Preferences
2. Product – Design, Pricing and Revenue
optimization
3. Retention – Big data driven predictive
analytics
4. Risk Management – Process Automation
Importance of Data Driven
Approach - 4 Case Studies

i. Acquisition – Consumer Behavior and Preferences
ii. Product – Design, Pricing and Revenue optimization
iii. Retention – Big data driven predictive analytics
iv. Risk Management – Case for automation
Four Real Life Situations

Challenge: Cost per acquisition (CPA) grows significantly when we scale-up the new
user acquisitions.
Objective: Scale-up new users acquisitions while keeping CPAs low.
Approach: Full funnel optimization through multiple experiments.
Acquisitions – A scale-up challenge

Approach: Full funnel optimization (FFO) through multiple experiments.
• Optimize Media buys – Reduce Cost
• Optimize Creatives – Improve Conversions – Reduce Cost / Lead
• Optimize Landing Pages – Improve Conversions – Reduce CPA
Acquisitions – A scale-up challenge

Business Objective: Bring down CPA
Hypothesis: Aggregated demographic targeting increases CPA.
Experiment: Micro-segmentation of demographic to identify the high converting
audience
• Data helped us identify the highly converting demographic
• We made micro-segments of that audience
• Highly focused media buys to scale-up campaign
Outcome: CPA down by 10%
Insight: Micro-segmentation leads to more structured spends and lowers CPA.
Full Funnel Optimization – Media Buys

• Optimize Creative – Improve Conversions – Reduce Cost / Lead
• Experiment 1: Simplicity Vs Complexity
FFO - Creatives

Simple Moderately Complex
FFO – Experiment
Which one won?

Simple Moderately Complex
FFO – Experiment
Moderately complex creative showed an 18% Improvement in Visit to Paid rate.

Business Objective: Reduce CPA by improving conversions.
Hypothesis: Absolute simplicity is better in interactive banners.
Experiment: We made two versions of an ad to test if Absolutely Simplicity in
Interactive Banner works better than Moderate Complexity.
Outcome: While Absolute Simplicity drives higher clicks, it doesn’t drive higher
conversions as audience need a problem that they think is challenging but quickly
solvable.
Insight: Players need a challenge that is solvable, quickly.
FFO – Experiment

• Optimize Creative – Improve Conversions – Reduce Cost / Lead
FFO – Landing Pages

Business Objective: Increase Click to Visit Rate and Visit to Lead Rates
Hypothesis: Registration form has multiple elements that need to be optimized.
Experiments: Alter the registration form components like:
• Number of fields
• Left or Right
• Register for Free
• Bonus message
Outcome: CTV up by 25%. LTP up by 20%.
FFO - Landing Pages

Add Cash Process

Choose Amount Screen

Product – Shopping cart challenge
Challenge: Flat-lining conversion funnel percentages
Approach: Optimize Shopping cart (or Add Cash funnel) funnel for conversions
through multiple experiments:
• Build plug-n-play framework for running A/B tests
• First experiment - Reduce the number of choices

Funnel Optimization - Reduced Choices
Objective: Increase conversion rate.
Hypotheses: More choice in selecting amounts results in lower conversion.
Experiment: Split users entering the funnel into two groups randomly
• Control group - 5 amount tiles
• Test group - 4 amount tiles

The Experiment – Control Group

The Experiment – Test Group

Outcome:
• Increase in conversions by 12% in the reduced options path
• Increase in average deposit amount by 15%
• Increase in ARPU by 17%
Insights:
• Less is more – helps players make a quick decision
• Behaviour – Propensity to deposit higher amounts reduces when lower amounts
are available
Experiment Results

Retention - High Early Churn Rates
Challenge: A significant proportion of players do not last beyond first day on the
site.
Objective: To improve early retention of new cash players
Approach: Offer a strong incentive to players sitting on the fence to return to play.

Context – Churn Trends
Problem: How do you substantially improve the Day1 retention while ensuring a
positive net return?
Points to consider:
• The incentive does not affect players who are likely to return anyway.
• The churn patterns beyond the first day are not expected to change.
How do you make an attractive yet profitable offer?

Identify which players are likely to return and which players are potentially one-
timers.
Using this model, we performed an a priori segmentation of players into Fence-
Sitters and Enthusiasts.
The Proposed Solution – Segment Identification

The Experiment - Control Group (Fence-Sitters)

The Experiment - Test Group (Fence-Sitters)

Insight: Customization of incentives and journeys for different segments can
significantly increase the impact of any promotion.
Results
Category Day1 Retention
Fence-Sitters: Test 59%
Fence-Sitters: Control 54%
Enthusiasts 67%
Over a 2-month period, this campaign yielded an ROI of 62%.

Risk Management – KYC verification for high value players
Background
• For a real money game company its very important that players play within limits.
• We give a small limit to players when they join the site.
• To protect players’ and manage risk, we follow a KYC process before increasing limits.
Challenge: KYC process is slow and people don’t want to share identity documents.
Objective: To increase KYC verified players without a monetary incentive.
Hypothesis: Offering a faster service as an incentive will increase KYC verification.

Risk Management – KYC verification for high value players
Experiment 1: This was a Time Series experiment. We started offering 1 Day withdrawal
processing time to KYC verified players.
Offer:
Results: Avg. daily KYC verified members increased by 200% and it sustained.
Experiment 2: This was a Time Series experiment too. To increase the numbers further, we
automated the document uploading process.
Automation: Once a player is eligible, show a message to players on website and ask them to
upload KYC documents instead of calling and asking them to upload documents.
Results: KYC verified players are now 1200% higher / day and it’s sustaining.
Withdrawal Processing Time
KYC Verified 1 Day
Not Verified 2 Days

• High value players added more cash thus leading to increase in cash deposits and
revenue.
• Taking actions to save people’s time is valuable and leads to revenue growth.
• Automation of processes that has significant impact on saving people’s time
should be taken up with priority for scaling up.
Insights

1) Multi-platform product / service
• Desktop, Laptop, Mobile, Tablet
2) Social Gaming
Future Trends

Rummycircle.com – Mobile & Beyond
• We estimate a potential market size of 1 million active rummy players and hence
expect our rummy business to grow rapidly for the next several years.
• We expect mobile to be a big driver of our growth.
• Smart phone sales growing close to 230% year on year.
• Smart phone users are expected to hit the 150 million mark by the end of 2015.
• The active 3G base is expected to hit the 100 million mark by the end of 2015.
• We released Rummycircle on mobiles and tablets in April 2014.
• In November, 12% of our new cash players joined us from their mobile devices.
• Over 10% of our revenue is now generated on our mobile platform.

To date, we are the only company in India to offer cash games on
mobiles and tablets.

• The current $10 billion casual gaming (social + mobile) market is expected to
double to $20 billion by 2017.
Social Gaming
• To tap into this massive opportunity
we launched Call It Right, our first
social game internationally on
Facebook, Android, iOS and Yahoo.

• Given the rapid proliferation of smart phones in India, we foresee the mobile
gaming space in India to take off in a very big way.
• We expect to launch our first game in the Indian market in Q1 2015 and have a
whole suite of games lined up for release after that in 2015 alone.
Social Gaming in the Indian Market

Connect on Twitter: @sachinuppal
LinkedIn: in.linkedin.com/in/sachinu/
Email me: Sachinuppal AT Gmail.com
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