Fortnite. I am sure you all have heard of it and probably even played it. For those of you who don’t know, Fortnite is a free-to-play battle royale game, that was released late 2017 developed by Epic Games and has since taken the world by storm. The game has become so popular that parents have started asking themselves whether their kids are addicted simply because they are spending so much time on it. Fortnite is unlike any other game we have seen in the past with how popular it has become as it has a target audience of kids and adults.
Now Fortnite is ‘free-to-play’ but how has the game managed to earn a “record $2.4bn in 2018”? (The Telegraph, 17/01/19) It’s quite simple really. Fortnite follows a ‘Freemium’ type business model. The way a Freemium business model works is that you as a consumer are able to access the basics of a product/service at no cost, but if you choose to upgrade to the ‘premium’ of that product/service by paying, you are able to access better features. Fortnite draws new players in by making the game free-to-play, all you need is a phone or a game console/computer and then you can start playing by downloading the game.
Fortnite offers in-game purchases which grant no competitive advantage which I think is why players spend any money on the game at all. In order to attain one of these items such as a “skin”, which just alters your character’s appearance, or an in-game dance, you must purchase an amount of the in-game currency called “v-bucks”. I will say that I have made at least one in-game purchase and do not regret it because you know what you are getting, whereas in other games, e.g. NBA2k’s MyTeam mode, you can buy ‘card packs’ which do not guarantee anything worth of equal value… but that’s another story for another day.
Fortnite has also been able to produce an enormous revenue figure due to the cost alone of in-game purchases. There are “skins” which cost AU$28 (US$20) at this moment in time, but many players are able to justify to themselves that purchasing a cosmetic for this much is fair due to the fact that the game is ‘free-to-play’. Some players have even said that purchasing these items is a way of supporting and giving back to the developers, seeing as in theory no one has to spend any money to play. To me personally, I think that statement by some players is fair as the game would not be what it is today without financial support from consumers.
Ultimately, I think Epic Games were able to generate so much revenue due to their Freemium business model and enticing players just to try out the game. If they were to perhaps charge players to initially play Fortnite, I don’t think the game puts up the same record setting numbers.
What are your thoughts on Epic Games’ business model? Do you think Fortnite would be as successful today if it wasn’t free-to-play? I’m interested to hear your comments/feedback.
Ian's Digital Marketing Blog 
Hey Ian!
I had no idea how much revenue Fortnite had actually made, that’s crazy! I went to the Aus Open this year and they had a tent full of computers for people to play Fortnite… It really has become extremely successful. I definitely think it’s smart using this business model as more people are willing to put money in. I think that because they have made the game so addictive, users probably do not realise how much time and money they are putting into the game! I wonder how the parents feel when they see how much has been spent on it
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Yeah I was a bit surprised too by that number, I knew it was a lot but didn’t know it was over $2bn. You’re spot on there, I really don’t think people realise how much money they’ve spent as the little transactions do add up over time! Another good point as well you made, that the little kids who don’t have their own money will use their parents’ cards to buy stuff whenever they feel like it, hopefully it’s hasnt gotten too out of hand for anyone.
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Hey Ian,
Really good read this week! Your explanation about a business model on this weekly topic is very clear..
I personally didn’t know how much profits they gained from their business and I think that Fortnite strategy of using the business model is very smart and it brings successful business. Users are usually willing to pay for something that they like since the game is very addictive.
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Thank you for the comment! I’m unsure as to the exact number Fortnite made last year in terms of revenue but it was certainly high! I agree that Fortnite is using the best business model for themselves and obviously has proven to serve them well. Thanks for the feedback!
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Hi Ian, great post! Fornite really has taken the world by storm, I used to babysit a boy who will sit and play for hours on end! However, I did not know it was free to play. I think a freemium model is a very effective and beneficial approach for a business. I am a sucker for something like this and have recalled many times I’ve paid for extra features in games for services, for example at the moment premium Spotify is something I couldn’t live without! Do you think because the skins and extras are in such small increments people don’t think of how much they’re spending and therefore thats the catch? Or are people not spending much its just that LOTS of people are spending these small amounts? My recent blog post was also about Freemiums if you would like to take a read! Looking forward to your next post!
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Thanks Steph! Yeah I can see why he’d play for quite a number of hours per day but that just goes to show how addictive it is. I’m exactly the same when it comes to freemium products, there’ll be times when I’ll be using Spotify premium but then cancel and switch to soundcloud go, then cancel and go back to Spotify! I think it’s because the skins don’t really cost too much per item is what gets people to spend a significant amount of money on the game. However, there are also tons and tons of players so that is also the reason but not the main one in my opinion. Glad you enjoyed and will be heading over to your blog right now!
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Hey Ian, nice post! Put simply, no I don’t think Fortnite would be nearly as successful if it weren’t free-to-play. This is only my opinion, however I believe if people saw there was a fee or subscription to play the game then it wouldn’t have nearly as much success as it has seen today. Contrastingly though I also believe that people may NOW pay to have access to the game as through the free accessibility they are willing to purchase additional access. I guess what I’m trying to say is that a free trial might have worked best for Fortnite and then for them to continue to charge players, possibly to make a further profit from the game. Although I haven’t played the game myself so I can’t be too sure haha.
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Thanks for your comment Jarryd! I think that most people share your opinion, myself included, that Fortnite would not nearly be as popular as it is today. Fortnite currently offers users an option to pay for extras in-game and even a paid season pass which allows players to unlock more items simply through just playing the game. I’m sure there are improvements to be made to their business model but I think the number of improvements needed would be very low.
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