Studies show that more than 260 million mobile game players are beyond the reach of app stores. But with Apple and Epic’s lawsuit having a big impact on the mobile gaming industry and monetization, new monetization opportunities outside of the App Store are opening up.
To talk about how mobile developers can capitalize on these new avenues, GamesBeat Summit featured Anthony Mendoza, Business Development Manager, Global, and Hannah Zhang, Business Development Manager, US, both at Xsolla .
Mendoza opened by talking about three major components of this new App Store freedom. First, players can now use online payment methods to purchase in-game items and currency, and top up their accounts. The second key opportunity is that developers can now market directly to players, to drive traffic to a branded online store for purchases. The third major element is a branded online store, which represents a new way for developers to own the entire user experience. And it looks like it could become a global trend.
“Apple may eventually lift restrictions and allow developers to offer alternative payment options to their users in more territories,” Zhang said. “Developers are more aware of their options for reaching out to their users to encourage them to pay directly and avoid Apple and Google’s platform fees.”
Reach 260 million new players
The lifting of restrictions also means developers now have a way to reach new, untapped markets – those 260 million gamers who can’t use app stores because they have no way to pay for their purchases ( as credit cards are not the standard form of payment in their country). When game developers can offer alternative and local payment methods, through companies like Xsolla, they can increase conversion and generate new revenue, and create a global community.
Xsolla offers a wide range of local and alternative payment methods worldwide: over 99 in the United States (a 10% increase in available payment methods), over 300 in Europe (+40%) and over 200 in China. and Asia (a 60% increase in South Korea, around 90% in China).
In Asia, including China and South Korea, Apple mainly offers credit card payment methods for users, but in China, 54% of payment transactions are through methods like Alipay and WeChat Pay. In South Korea, many users rely on local credit card payments like KakaoPay, Toss, and Payco.
In Central and Latin America, Mexico has around 50 million gamers and Brazil around 75 million – and 50% of those gamers use local credit card brands. Boleto Flash accounts account for around 15% of the market, while a promising instant payment method called PIX is gaining traction. In the United States, much of the untapped market comes from things like game store gift cards.
“One of the biggest draws to all of this is being able to own your own community,” Mendoza said, which is huge for marketing purposes.
For example, a game developer or publisher can collect email addresses through confirmed purchases or online store initiated purchases, and then target campaigns and advertisements to those email addresses to maximize profits.
“You own the data. You own your ecosystem. You can have direct marketing and direct engagement with these players that you couldn’t otherwise do on the Apple and Google platforms,” he added. “There’s the big appeal of marketing campaigns, being able to communicate with your users and players on a more intimate level.”
Beyond marketing campaigns, the online store also offers other benefits and value propositions, Zhang added. For example, Xsolla’s online store is a white label digital store allowing developers and publishers to sell subscriptions, game items and currencies directly to their users from their own customizable branded website. The storefront becomes part of the community as it provides a way to distribute games along with update features, news, and leaderboards.
Independent online stores are also circumventing Apple’s $99.99 restriction on the price of user plans. Xsolla partner Playstudios offers a VIP page to engage whales with exclusive mobile ware content. Similarly, Scopely has created an online store outside of its mobile games to sell bundles and special packages to its high LTV cohort and whales.
“You make your users and your community feel special by having this alternative ecosystem for them to talk to each other and buy things,” Mendoza said. “This is where you build trust in your community and your players. This is where you will build loyalty, and loyalty in the mobile gaming industry means money.
Watch the full session on demand here.