Only 1.35% of gamers spend money on mobile game purchases!
Mobile games are one of the most used types of apps by users. Many of these are free-to-play, or free-to-play productions. However, every commercial application should bring revenue to its author. Therefore, games provided on a freemium model use various types of advertising or virtual goods to monetize the application. However, it turns out that mobile gamers are quite "ungrateful" users.
Why?
The latest data, released by analytics firm Swrve, indicate that Only 1.35 percent of all players choose to make purchases on mobile games. What's more, the trend is quite unfavorable, as this figure has declined (as recently as January this year it was 1.5 percent). Swrve representatives also admitted that they have discovered a rather disturbing correlation, according to which, only 0.13% of players are responsible for 62% of all game revenues.
The above data may cause concern for developers and publishers, especially those who base the monetization of their projects on the sale of virtual items. This is because they point to the fact that such products depend on a rather small audience. Hugh Reynolds, Swrve's head of strategy, warns: be very careful when acquiring new users, as most of them won't spend a cent on the game anyway.
Companies should make an effort to make sure that each, new player, will be willing to spend money on a virtual good.
In the latest Swrve report, there has also been some good news. Despite the declining number of users who pay in-game bonuses, game developers need not break down. The group of people spending between $10 and $20 per month is growing, which has a positive impact on purchase revenues (these players account for 32.3% of revenues, and just six months ago it was 22.4%) in this group of users.
However, it should be noted that developers earn the most from the smallest group of users, who spend more than $21 per month.
The aforementioned data, commented quite briefly by Christopher Dean, CEO of Swrve, saying that "The conversion rate is at an all-time low", and app revenues are generated mainly by the smallest group of the most generous players, as the chart below perfectly illustrates:
The report also provides information on players' habits. It turns out that the average mobile game lover, spends $24, 93 (an increase of $2.93 since January 2021) in a month and does so through 3 purchases of about $8.34 each. It is also worth noting that 50% of players make just one purchase per month, while 16% make five or more. 55% of all transactions per month settle for up to $5 and account for only 18.5% of revenue.
On the other hand, purchases over $50 account for only 1% of all transactions, but they provide as much as 11% of revenue.
What conclusions are allowed by the above-mentioned data? The aforementioned Hugh Reynolds and Christopher Dean argue that the developers should consider not so much acquiring a potential player, but rather retaining them and tying them to a particular production. They also emphasize the role of in-game promotions and sales campaigns, as well as identifying a group of key players and personalizing their experience.
Moreover, there is a growing percentage of users who are willing to make a relatively high and one-time in-game purchase. Game developers, should base their sales strategies on this very trend, Dean said.
The recipe for a commercially successful mobile game, is to "identify the people who generate revenue, understand them and build a relationship between them and the product," – concludes Reynolds.
