According to CEO Tim Sweeney, Epic Games’ strategy of offering free games on its store has proven to be a highly effective and cost-effective way to acquire new users. In a recent discussion, Sweeney revealed that while some of the company’s exclusive offers have been successful, many have not been good investments. “Giving away free games may seem counterintuitive, but companies spend money to attract users to games,” Sweeney explained.
“For about a quarter of the price of acquiring users through Facebook or Google search ads, we can pay a game developer a lot of money for the right to distribute their game to our users, and we can bring new users to the Epic Games Store at a very reasonable price.”
Sweeney noted that developers often see a boost in sales of their paid games after offering a free game on the store, as it increases awareness and encourages user engagement. Developers often partner with Epic to release free games ahead of new launches to maximize visibility. Documents from Epic’s legal battle with Apple show that the company spent $11.6 million on free games in the first nine months of the program.
Despite the costs, Sweeney called the initiative “very economical” and emphasized its cost-effectiveness compared to traditional advertising methods.
Epic’s user acquisition challenges
In contrast, Epic has encountered difficulties with its strategy of entering into exclusive contracts with publishers.
“We spent a lot of money on exclusives,” Sweeney admitted. “Some of them worked very well. A lot of them were not good investments, but the free games program was just magic.”
According to reports from 2021, Epic may have lost over $300 million in exclusive contracts by then.
Although the company has been slower in pursuing new exclusive deals, the strategy remains in place, especially for games funded through Epic’s publishing division, which launched in 2020. Overall, the free games initiative is proving to be a highly successful and economical strategy for the Epic Games Store, while exclusive deals have yielded mixed results. The success of the free games program suggests that it will continue to be a cornerstone of Epic’s user acquisition strategy going forward.
