Earlier this week we covered the Games Developer Conference Europe 2010 (GDCE) session on Monetizing Social Games. Continuing on the same topic from a different angle, in another GDCE session, Teut Weidemann, lead designer of Settlers Online at a Ubisoft studio, provided further guidance on how to actually maximize the games’ monetization by game design. He presented, as reported by Gamasutra, that in order to succeed with the freemium business model, one should “exploit human weaknesses”, i.e. design the game so that it psychologically resonates with the deepest human feelings – so look into the seven deadly sins

First and foremost, Weidemann instructed that naturally a game must be fun to attract (free-to-play) users, that is a no-brainer. But once in the game, these free-to-play users need to be monetized as efficiently as possible to generate revenue, to make it a sustainable service business-wise. Weidemann declared that monetization has now become the “most crucial and integral part of game design” – something the social game developers have to think about from the beginning.

Rather candidly, Weidemann acknowledged that in Settlers Online they are “monetizing all the weakness of people,” i.e. using the seven biblical sins to drive business: Vanity (showing off), Envy (introduce rarity), Gluttony (consumable items), Lust (instant gratifications/upgrades), Anger (use hate to sell e.g. better weapons), Greed (production increases, trading), Sloth (sell comfort).

Quite understandably, this statement has generated rather heated discussion for and against, as one can read from the Gamasutra article’s comments. Some understand that this is just business as it should be – everybody is in business to make money, or will go out – so it is no different than for instance selling extra equipment and features for cars (like satellite radio or leather seats, that are not really required for driving). Others cry out that this kind of mentality is very much unethical, and could be in fact matched to the business of drug dealers – making a fun and appealing product is another thing than taking advantage of people.

Whichever view one shares, it is obvious that launching a product for free, getting a decent pool of free users, and then trying to generate revenue from that base is no easy task. Most likely lots of iterations and tweaks on the go are needed. Furthermore, if one makes no conscious and planned effort to monetize the userbase, more often than not it probably just won’t happen itself, as for instance these case studies on using the freemium model with various web products like Pandora and Dropbox demonstrate. Building a good product (be it a game or something else) alone won’t generate you revenue. You need also business planning.

If there is such a thing as psychological abuse by unethical freemium product design, is it just games, or can that apply to freemium products also in general? Since supermarkets and consumer brands use the same strategies for selling people “new” versions of their everyday products, researched in lots of consumer psychology studies, is there really any difference, or unwritten rules not to break?