The global mobile game market is expected to top $46 billion this year. However, only 10% of all gaming apps enjoy relative commercial success. As an indie developer, how are you going to monetize your games in 2018? Here are some mobile game monetization strategies you can try.

Mobile game monetization: top 5 strategies for 2018

  • In-app purchases (IAPs). App Annie reckoned 2017 would be the “banner year” for the global app economy; still, in-app purchases remain the most effective app monetization strategy with $37 billion in revenue. Although only 5% of players actually spend money on IAPs, they bring 2000% more profit than the average smartphone owner. IAPs give developers a unique opportunity to control what happens at the point of sale (which is hidden somewhere inside a mobile game); it’s no wonder free-to-play/pay-to-win will continue to dominate the market through 2018 and beyond! There are several IAP trends you need to consider in order to attract and retain users. According to William Grosso, CEO of Scientific Revenue, next year forward-thinking game developers will experiment with limited time events, behavioral incentives and dynamic pricing (including annuity payments). Also, more games will incorporate 2+ types of virtual currency, enable special purpose purchases and offers targeted at certain segments of a game population (like “New Player” deals which expire in 24 hours);
  • Paid games. That’s right, Minecraft is the only paid app on the US top-grossing games list right now. It doesn’t mean that going paidmium is a dead end, though. This year, paid apps made app stores and developers $ 29 billion richer. 15% of Google Play top apps (98% of the store’s revenue comes from free apps, remember?) have paid sister apps unlocking extra features! If you want to release a paid mobile game next year, go ahead! However, you should conduct competitor analysis to find out what game genres resonate with your audience, come up with a great concept, invest in graphic content and keep updating the game after the release. Your game doesn’t even have to be 100% unique: Mobile Strike – which is a shameless clone of Game of War – reportedly makes over $ 200 thousand a day, so it’s all about execution and engaging gameplay in the end;
  • Ads. We all know mobile gamers are more likely to put up with promotional content than other app users. However, a game with around 30 thousand active players that uses in-app ads earns less than $ 1 thousand per month, so you need a dedicated multimillion following to make ends meet. Through 2018, more developers will move away from traditional ad placement, turning to rewarded ads and IAPs instead. According to Unity’s survey, over 50% of game developers now cite rewarded video ads as the most profitable revenue channels, while 80% of players “always” or “often” choose to view sponsored content in full to get rewards. Rewarded ads is a great alternative to in-app purchases and basically your only way to monetize non-paying players; why not give it a try?
  • Sponsorships. Back in 2015, Angry Birds fans could bombard the awful pigs with Honey Nut Cheerios for 2 weeks; according to Rovio Entertainment, all active players used the new feature at least once. Another example comes from Zynga who crafts sponsored Farmville levels. Just like traditional in-app banners, sponsorships work best for popular mobile games. The approach, however, gives developers a lot more control over banner content. Recent studies show that players are 3.5 times more likely to buy a product after viewing a relevant ad (compared to random banner placement). In 2018, publishers will most likely resort to sponsorships and rewarded ad mechanisms to reduce their reliance on IAPs; if your game is already getting some traction, you should give it a go, too!
  • Merchandising. Once your game achieves commercial success, you can boost its longevity by distributing game-related products including stuffed toys, t-shirts and notebooks outside the App Store and Google Play. Snowman, the creator of Alto’s Adventure, set up an online store selling art prints, stuffed llamas and clothing. 45% of Rovio’s profit comes from Angry Birds merchandise (which ranges from carbonated drinks to feature movies). Alongside subscriptions, merchandising remains one of the least popular game monetization strategies, and things aren’t likely to change next year.

Mobile game monetization trends: summing it up

The number of mobile game players worldwide topped 2.8 billion last year. Games drive 75% and 90% of the total App Store and Google Play revenue, respectively. You’re dealing with an enthusiastic and ever-growing market – and so do hundreds of game dev companies and publishers around the world. The app discoverability issue has yet to be solved. Getting featured by the App Store/Google Play is still the only tried-and-true path to success. However, a whooping 53% of developers don’t even think about a monetization strategy before a mobile game is already “late in development”.

And this brings us back to the very first paragraph of the article. Only 10% of mobile games are considered successful by their developers and publishers; how could you possibly make it to the lucky ten?

In 2017, no huge games have been released to the market yet, so we have to travel back in time and look at 2016’s game success stories. Obviously, it’s Pokémon GO that ruled the world last year. One and a half years on, the game continues to generate over $ 100 thousand in daily revenues and is currently ranked #30 on the US top grossing games App Store chart. The power of nostalgia aside, what made the game an instant hit?

Why, it’s the addictive gameplay and focus on innovation!

2018 won’t be different. As long as you make use of AR SDKs and AI-powered algorithms and spend months developing game concept (and a flexible monetization strategy!), you’re doomed to success.