Developing the next big iconic mobile game that garners a lot of worldwide attention is the dream of all mobile game developers. They go hammer and tongs as they strive to create an immersive gaming experience, packed with stunning visuals and catchy gameplay. Driven by advanced technology such as augmented reality, virtual reality, cloud gaming, and 5G, today’s mobile games are far superior in terms of quality and experience. While gaming innovation and player experience are the focus of developers, publishers are grappling with the business aspects of it all, behind the scenes.
Why is revenue important for mobile game publishers?
Mobile game publishers can consider themselves ‘successful’ only when they start monetising their games. Until such time, they are merely competing in the race. Merely engaging with players is not enough; it needs to translate into an uptick in ad revenue, conversion rates, app purchases, and subscriptions.
Mobile game monetisation is a tricky business that requires publishers to explore multiple revenue streams and approaches so that they can make sure the mobile game not only attracts eyeballs but also rakes in the moolah.
Market at a glance
In the year 2020, the global mobile gaming industry was worth $98 billion. This is said to grow at a CAGR of 11% and reach $272 billion by 2030. Middle East, India, and Southeast Asia are expected to drive much of the growth in the coming months.
The mobile gaming industry in the Middle Eastern market is projected to grow 25% a year in the next two years to reach $4.4 billion (AED 16.1 billion) by 2022, according to a report by Amsterdam-based market research firm Newzoo, driven by the region’s fast-growing population, particularly the youth, and a deep penetration of smartphones.
In the UAE, mobile gamers play for 20 to 40 minutes a day on an average (source: AdColony). Expanding local investments in gaming and a growing home-grown talent pool are driving the market in the region in a big way. Presence of local and global players, increasing R&D activities, and strategic alliances are making the mobile gaming industry a competitive marketplace.
With so much potential for growth, are publishers of mobile games in the Middle East market ready to up the ante and give a definite edge to their mobile gaming business?
Here is where data and technology come into play, which help publishers make decisions and predictions around the following:
- How much to spend on customer acquisition
- Potential value of one customer versus another
- The likelihood of a particular player bringing in new players
- When a particular player will churn and what can be done to prevent that
Let us examine a few winning monetisation strategies that act upon customer intelligence and maximise technology, such as artificial intelligence and machine learning tools, to find important considerations, dependencies and correlations, and create intelligent algorithms.
1. Analyse and understand
Technology helps publishers garner valuable player insights and actionable analytics about ad performance. It also helps marketers understand how and when each player interacts with their game.
Data science helps publishers consider and comprehend factors like demographics, location, acquisition channel, device type, activity history, nature of interactions and transactions, progress, preferences, interests, and many other data points that help them understand customer behaviour.
And then the magic happens. When advanced technology and business intelligence tools are applied on these datasets, patterns are drawn from the data and applied on players. Publishers can then compare and segment players based on usage and frequency into cohorts such as one-time customers, infrequent customers, occasional customers, and frequent customers. Publishers also can map customers’ steps in their on boarding journey across digital touchpoints, identify drop-offs and factors that lead to retention and churn, and analyse the behavioural differences between repeat and non-repeat customers.
2. Predict
Advanced machine learning tools and AI (artificial intelligence) algorithms do a quick analysis of tonnes of data to find patterns and establish rules that help publishers make predictions. For example: whether players will make an in-app purchase or not, which customer will stop using the app, or what messaging works the best for which player segment. Using technology, publishers can also create models that predict the lifetime value of players (LTV).
LTV machine learning models will help developers and publishers decide how much money to invest on customer acquisition, based on how much money a particular customer is likely to spend. The general rule of thumb while investing in player acquisition is that costs must preferably be below 1/3rd of the gross LTV, besides taking into account factors such as expected growth and market landscape. LTV also helps estimate the cash flow a player will bring to the table across their entire lifetime. So, a model that predicts the LTV of players will provide granular data on the kind of impact a particular customer can have on the bottom line of the business and its cash flow.
3. Personalise
When publishers are equipped with data on who viewed what, who purchased what and when, and who ignored the different in-app offers made in the game, they can course correct along the way and tailor offerings and game experiences to suit customer preferences and attributes.
Publishers can also work on sending hyper-personalised nudges and notifications on similar games or additional purchases to reach goals in the game faster, instead of loading them with generic in-app offers that are not relevant to their interests. Frequent and dynamic content updates and live ops have a huge bearing on customer satisfaction, retention, engagement, and monetisation, ultimately driving LTV.
Personalisation goes beyond customised banners and content. With technology, publishers can even personalise page layouts for different visitors, based on their patterns of behaviour and interaction. What’s more, the performance and reach of every layout can be measured, so that relevant iterations and improvements can be made for boosting conversions.
4. Engage
If each customer is unique and comes with different expectations and proclivities at different stages, does it make sense to force the same campaign on all of them? It is important for publishers to understand the customer’s sensibilities at different stages of their life cycle and orchestrate appropriate multiple data-driven omnichannel communication campaigns across the customer’s journey—right from onboarding to retention and long-term loyalty.
Machine learning helps drive this kind of dynamic customer engagement across several communication channels, while AI helps publishers pick the right time for the right kind of messaging (push notifications and in-app offers) by running A/B tests at scale. Using AI, publishers can also create static and dynamic multivariate tests to optimise the click-through rates of engagement campaigns.
Ultimately, automating monetisation techniques using technology gives publishers the amazing ability to unlock the value of their customer base. It helps them reward active players, reduce churn, and target and engage with customers using appropriate campaigns—so that players are most likely to make purchases, return for more, get hooked to the game, and even become brand advocates.
