Commentary

Mobile Game Revenue: 64% Comes from 0.2% of Players

When it comes to spending money for mobile gaming, a lot of the money can come from a relative few.

In games where revenue can be derived from in-app purchasing, not all paying players are created equal, based on a new report.

It turns out that the majority (64%) of revenue comes from the top 10% of those who pay, according to the Monetization Report by Swrve, which analyzed tens of millions of users and their associated gaming activities during a one-month period.

And as a percentage of all game players, that 64% of revenue comes from only 0.2% of all players.

While most money comes from the minority, 60% of those why pay anything contributed only about 8% of all revenue.

The report included only freemium games and revenue delivered via in-app purchases.

That later in-app purchasing can make a difference.

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A different global study by Juniper Research found that a scant 1% of mobile apps are paid for at the point of download, which I wrote about here at the time (235 Billion App Downloads This Year; 99% Not Paid).

For overall app downloads, China is first followed by the U.S., according to Juniper.

For mobile games, the vast majority of players deliver no revenue, according to the Swrve report, with only 2% of players active in a month making a purchase within that month.

This means that some marketing dollars spent recruiting game players may be wasted, though it is unclear which dollars.

The largest percentage of those who pay make only one purchase a month followed by 20% making five purchases. Here’s the breakdown of monthly purchases:

  • 44% -- 1 purchase
  • 20% -- 5 purchases
  • 17% -- 2 purchases
  • 12% -- 3 purchases
  • 7% -- 4 purchases

The average monthly total spend per game is $29, an increase from $22 a year ago.

For context, mobile gaming revenue in the U.S. is expected to grow 17% this year, reaching $3 billion, according to eMarketer, as I wrote about recently (Mobile Digital Sales: Games $3 Billion, Ebooks $4 Billion).

It looks like a lot of that money will not be coming from the masses.

 

2 comments about "Mobile Game Revenue: 64% Comes from 0.2% of Players".
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  1. Douglas Ferguson from College of Charleston, April 21, 2015 at 9:55 a.m.

    This is known as the power law distribution, quite common with everything web-related. Most activity is generated by the fewest people.

  2. Chuck Martin from Chuck Martin, April 21, 2015 at 9:58 a.m.

    Good point Douglas, though that seems like quite a small percentage in this case.

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