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October 19, 2019
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Mobile Game Monetization: Where to Start

by Kate AppFollow on 07/09/19 11:00:00 am

The following blog post, unless otherwise noted, was written by a member of Gamasutra’s community.
The thoughts and opinions expressed are those of the writer and not Gamasutra or its parent company.

 

When to plan your monetization strategy?

The biggest mistake a lot of new developers make — start thinking about money after the game is fully developed, or even worse — after its launch. Think about monetization strategy when you start building the very concept of your game. Even if you don’t plan to sell anything right away, having a certain strategy in mind will help you create more meaningful points of interaction with the users. 

Let’s imagine that we are working on a battle game: we have the whole economy structured, we have thought about how long a session should last, and the LTV of the user and everything. After a while, we decide to add ads or include in-app purchases, and this is when the troubles happen. By adding ads we can break the whole economy and lose a significant part of the money that we could otherwise earn. A lot of newcomers get stuck at this stage: they build a game, have enough content and then the game is just unscalable. And when the game is unscalable, we have no place to move or grow.

Thinking about app monetization in advance will help you get more knowledge about who your audience is and plan extra gameplay features for the future. 

How to choose the right monetization model?

There are four popular monetization models: paid apps, ads (aka in-app advertising), in-app purchases (IAP), and subscriptions. We all know the “classic” models: ads and paid apps, that are available for both App Store and Google Play. Apple, however, now offers more options for developers to make money with the apps they create in-app purchases, app bundles, and subscriptions. 

According to Statista, the most popular are ads and IAPs. Ads are more frequently used for Android apps, and iOS users are more willing to pay, and here IAPs get into the game. 

Making your game paid is a good option if you are able to convince a user to pay you right away. This monetization model often prevents users from downloading your game and gives you one-time revenue. Why pay if I can try other games for free? A paid model will work for you if the game is either very popular or has very few competitors. A game's reputation in app stores will also play an important role in a users decision to pay for your game, so make sure your game maintains a high rating and positive reviews.

Why are ratings and reviews so much important for your monetization strategy? Discover how they affect your game downloads.

Let’s have a closer look at the other approaches to app store monetization that may guarantee you constant income.

In-app advertising

Ads seem to be the easiest model for a start. If you want to keep your game “alive” just for a couple of days, you can spam users with ads and take away as much money as possible. However, if you approach your mobile game as a long-term business, think about combining the monetization strategy with the UX. Ads and the action button should be visible as well as your call to action. If you want to incentivize your players, show them where to go.

Getting back to our battle game, say we have decided to add an ad banner and reward gamers who watch the ad. In this case, we need to keep the button visible and the call to action clear to make them click it. Otherwise, gamers may not understand that they will be rewarded. The worst mistake we can make here is hiding the ad somewhere in the menu where it would be too difficult to find. 

In-app purchases

In-app purchase (IAP) is a better choice when you want to give users more control and gaming options. They give you more flexibility: it's just easy to turn them on and off for a certain time period and/or for certain features. 

Say, in our game, we have collectible characters and different advantages. In this case, we prefer an IAP to a rewarding video. Alternatively, if a game is popular enough, we can offer each of its levels as an IAP. The game itself is an economic simulator, and we will place the IAP somewhere in the pressure points, where players need to upgrade something in order to continue or move forward.

Subscriptions

The subscription model could be the next big monetization strategy for games, but no one dares to nail it so far. 

Say, if in a game we have dozens of quests, we can sell them as in-app purchases. Another way could be offering a subscription, but at the moment you’d better combine it with a more proven model in a mobile gaming area.

Keep in mind that most purchases usually come from the communities thanks to all the events, promotions, sales, and these types of things. They help you make a lot of money. 

How to convince players to spend money on your game?

People invest in something that helps them progress faster and the same applies to their behavior in a mobile game. Use ads and IAPs to help players get through the game levels faster as this is what charges and incentivizes are for.

Your possible earnings will also depend on a game genre. Different genres require different monetization approaches: say casual, hyper-casual, mid-core, or hardcore mobile games. The more hyper and casual the game is, the more ad revenue out of total revenue you will get. Casual players don’t play hardcore, and they don't spend as much money. 

There is another way to increase your revenue using LiveOps. Such platforms, as PlayFab, helps you manage game configuration and gamers remotely. It's not as daunting as it sounds to get started with LiveOps. It’s essential, if you are baking in the content, activate it remotely, and have a server to do this. If you’re an indie game developer, there's probably a simpler way for you, but that might be dangerous just using the system clocks. Such platforms also give you more options to analyze gamers behavior, and by doing so you will be able to add in-app purchases right when users will be ready to pay. 

To convince a player to spend money in your game, your monetization strategy needs to be very tied into the user acquisition strategy. You need to know how much you're going to pay for a user and how much that user is going to make you. If you don't have both of those things, you don't have a monetization strategy really. You kind of have a hope that you'll sell something to some people who will come out of nowhere.

Where to start?

If you don't have the skills or experience to do any of what we mention here, go with a partner that understands the gaming. Find a publisher or a consultant who is working or has been working with other game developers and can assist you with app monetization ideas. Most likely they already have the answers you are looking for, so don’t waste your time on this and focus on the new exciting features that will make your players pay for them.


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