Sep 30, 2025

The Art of IAP Strategy: Lessons from DigiGods on In-Game Monetization

Over the last two years, free-to-play (F2P) games have emerged as one of the most popular and fastest-growing sectors of the Meta Horizon ecosystem. As new users flock to the platform, drawn to multiplayer games and social hangout experiences, they’re growing what was once a niche into a thriving category. Leading the way are studios like Squido Studio, a 10-person team of VR developers based in Montreal, Canada. Let’s take a deep-dive into the success of their free-to-play sandbox title DigiGods, and explore how Squido approaches monetization through smart experiments, behavioral insights, and an emphasis on sheer fun.

At Squido, we’re always trying to make things nobody has made before. We’re always trying to find new ways to make things cool.

Eric Laurent, Marketing Director at Squido Studio

The Not-So-Basics of IAP Strategy

To understand how DigiGods grew a sustainable playerbase, we sat down with Eric Laurent, Marketing Director at Squido Studio, to unpack his biggest lessons on in-app purchases (IAPs) for F2P games.

Eric’s first rule for implementing IAPs within F2P games was as simple as it was bold: Don’t start with IAPs. Start with retention.

In other words, start with the players. Are they coming back? What are their incentives to play again? How long do they stick around? And are they having fun? Once you’ve nailed engagement and retention, that’s when you can start really strategizing for in-game monetization.

Making Purchasing Part of Your Game

For F2P titles, IAP is often the core way to make money. But the question isn’t just what to sell, it’s also when, where, and how. And more specifically, what are the unique considerations when offering digital goods in VR?

Eric is convinced that the biggest payoff comes when monetization is deeply integrated into game development from the start. Once you’ve nailed retention and know what you’re going to sell, you’re going to be ready when the moment for monetization arrives.

If you think of [monetization] while you’re building your game, you know your IAPs are going to be much more deeply integrated which can lead to much better sales.

Eric Laurent, Marketing Director at Squido Studio

To achieve that level of deep integration, the DigiGods team took an exhaustive look at their user experience, thinking analytically about player behavior. This effort produced important insights about potential opportunities for implementing monetization from the player’s perspective, such as within skill trees or progression flows.

They also considered differences between cosmetics and what they called “gadgets”: the former can be fun and novel for a player, but the latter truly interacts with the world and embeds itself into the player experience in a deeper way. For each new default item or gadget developed, Squido cleverly envisioned a premium variant designed for monetization. Even their cosmetics transcended mere aesthetics—alternate skins for items and weapons introduced distinct in-game effects.

All in all, this exercise allowed them to build better hypotheses about their potential audience: anticipating what players value, and what compels them to return.

In DigiGods, each new cosmetic item or gadget is accompanied by a premium version that’s designed for monetization.

Even so, when the time came, Eric and the DigiGods team wrestled with finding the optimal integration of digital goods in-game early on. In the first weeks post-launch, sales just weren't increasing. DigiGods needed to find ways to improve their monetization flow.

The team turned a critical eye towards the in-game purchase experience through the players’ perspective, asking themselves, "When I spawn, where am I looking? How much time does it take me to find things I want to buy?" They reached two important conclusions: first, in an immersive medium, the IAP shopping experience should feel immersive as well. This meant making virtual items diegetic: not just static pop-up ads, but objects that you can hold and interact with. Second, storefronts and UI should be accessible and high visibility, making the purchase experience more enticing.

No matter what you do, just make sure that you know players are immersed, [and] can feel and grab things.

Eric Laurent, Marketing Director at Squido Studio

The result was DigiCity: a central hub with stores as far as the eye could see. When a major bundle or IP release drops, players don’t just scroll through a menu – they encounter physicalized representations of IAPs, in the form of giant statues in the game lobby.

DigiCity provides players with a central hub to visualize new items as they appear in-game before purchase.

The results spoke for themselves: after implementing physicalized goods and making their presence super-apparent in the lobby, DigiGods effectively increased their average weekly revenue by over 50%+ in the following months.

If players have to look for the store, you’ve already lost.

Eric Laurent, Marketing Director at Squido Studio

It’s All a Learning Experience

If there’s one thing younger audiences love in the VR space, it’s just hanging out. In-game lobbies have become vibrant hubs where players can connect with one another through interactive environments and bite-sized social activities. DigiGods also recognized that their lobbies presented a unique opportunity to explore new monetization strategies.

Before players buy an item in DigiGods, they can play with it. The lobby offers a variety of these gadgets to experiment with freely, but their functionality in PvP scenarios remains unseen. This limitation is intentional: unrestricted access can diminish the sense of novelty, leading to a decline in sales once players feel they've already experienced the product.

According to Eric, it’s all about finding a balance. Let players engage with an item, but reserve the full functionality for after purchase. Touching and exploring things is a very different experience in VR. Developers should keep the nuances of the experience top of mind.

Think Thematically

Big updates mean big IAP bundle opportunities. Some of DigiGods’ most successful IAPs have come by way of themed drops, particularly with the Monkey Madness, Cat Craze and Warzone updates.

Each IP drop gets paired with matching key art and a big IAP pack to drive clicks and conversions on DigiGods’ product page. And if you know the click-through rate and conversions are doing well, chances are your IAP conversions will do well too. Looking at the data, the release of themed updates showed a strong positive association with peaks in revenue over time. After the Warzone theme drop in particular, there were over 9x as many sales and an over 60% lift in D7 Average Revenue Per User (ARPU).

The DigiGods team built hype for themed drops around a week in advance, spreading the word in-game, through social channels and the game’s passionate influencer-fans. And to gather ideas for future drops, the team leveraged trends and kept a watchful eye on the conversation on Discord. Today, popular items that have withstood the test of time remain available in the DigiCity hub.

Our currency IAP packs sell much less than our themed IAP items and bundles. Our currency is easy to acquire in-game, which is another factor to consider when trying to sell your currency via IAP.

Eric Laurent, Marketing Director at Squido Studio

When it’s Time to Monetize

How do you know you’re ready to start monetizing in F2P? According to Eric, “That depends on the scope and where you want to be as a company and as a studio.” While the math looks different for a solo dev vs. a 40-person studio, profitability is key. For Eric, the monetization conversation starts with laying out a few key numbers:

Determine your operating expenses

Determine the right amount of cash flow and runway

Calculate average revenue per user (ARPU) and # of players

Determine which KPI you’ll focus on for success

And when it came to KPIs, few were as important to Squido as high retention rates. They took that focus on retention into their next game, Grand Theft Animals. When Grand Theft Animals launched, the priorities were clear: first, setting a benchmark for cash flow; then, optimizing for retention; and finally, considering pricing.

Eric’s perspective on pricing is bold and somewhat counter-intuitive:

I try to always listen to our community, but the one place where I experiment and lead with data is pricing. This might be the one place where you shouldn't listen to anyone.

Eric Laurent, Marketing Director at Squido Studio

Asking the fans about pricing invariably returns the same answer: The lower the price of an IAP, the better. But Squido’s data proves emphatically that the opposite approach proved more effective: in the first half of 2025, the priciest DigiGods bundle ($39.99) has generated the highest amount of revenue by far, and remains the second highest driver of IAP units sold. So whatever players may say about pricing, their choices demonstrate that quality is key.

The Need For (Update) Speed

Cadence of updates is a critical driver of player engagement and revenue. A consistent release rhythm ensures the in-game store remains dynamic and enticing, encouraging players to return regularly and explore new offerings.

But is there such a thing as “update fatigue” when it comes to new IAP offerings? In the case of DigiGods, the answer is … maybe not. Eric and his team embraced an aggressive update model, launching new items and bundles at a steady pace. The approach has proven effective: each update, regardless of its scale, has consistently led to a measurable increase in revenue. Interestingly, despite the frequency, the team has never observed signs of IAP over-saturation, suggesting that regular updates are not only sustainable but desirable.

We’ve never tested for fatigue. But we’ve always seen increased revenue from a new update/IAP, even if the space between them is on a weekly basis.

Eric Laurent, Marketing Director at Squido Studio

This strategy aligns with findings from other recent hits like Animal Company, who credit a similarly-paced weekly update cadence with their success. The ability to maintain momentum and keep the store feeling fresh is instrumental in building a loyal player base and sustaining long-term monetization.

DigiGods demonstrates that frequent and consistent updates, paired with community-aware bundling and thematic relevance, can drive sustained engagement and revenue. While pacing should always be monitored, the evidence suggests that moving fast and iterating often is a winning formula in the F2P space.

Key Takeaways

With DigiGods, Squido has established a model for successful IAP integration that combines thought integration and speed for maximum impact. For developers looking to monetize within their own games:

Make IAPs diegetic: DigiGods transformed the IAP experience by embedding their goods directly into the game world. Instead of static menus, players encounter IAPs as immersive, physical elements.

Explore deep IAP integration within the game's user flow: The Squido team analyzed player behavior to identify natural points for monetization. This approach ensured that purchases felt relevant and meaningful within the gameplay experience.

Bundle IAP releases around themes and major updates: New IAP releases were bundled into themed drops or to coincide with updates to the game. These bundles consistently drove spikes in revenue and engagement.

Experiment with a weekly release cadence: DigiGods adopted a fast-paced update schedule, launching new IAPs weekly. Each release led to increased revenue, and the team never observed signs of fatigue.

When it comes to pricing: test, test, test!: Squido found that higher-priced bundles often outperformed cheaper ones, despite player feedback suggesting otherwise.

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