VentureBeat Tells Mobile Game Developers To Brace For a Bloodbath

An article in VentureBeat this week features a new report from SuperData which confirms the moment we’ve all anticipated, or dreaded, is here: mobile gamers cost more than they’re worth. In October the cost of acquiring a new smartphone or tablet gamer exceeded the average revenue companies got from that player. Further, SuperData estimates that game developers need to retain players for two or more months before they become profitable.

This article definitely confirms my conversations with developers and publishers. The cost of acquisition is rising rapidly and there doesn’t seem to be a great solution on this side of the equation. Naturally, developers and publishers are increasingly looking to balance the cost/revenue equation by offering more to users to improve sales, conversion, and retention.

Adding real money gaming elements to certain games could really be beneficial to game content that is targeted to the 21 and over market. All statistics from online real money gambling indicate that publishers should expect a substantial uplift in retention, conversion, and sales when real money gambling elements are added. Most people seem to focus on the rather large ARPU numbers that real money gaming brings, but experienced publishers know that is only one part of the monetization puzzle.

Those numbers are certainly impressive. However, with retention being as critical as acquisition, if not more critical, I think it is more interesting to note that retention and conversion numbers for real money gambling are considerably greater than your average mobile game.

David Chang

Gaming Labs Certified