Mobile Game Business Models
How do mobile games make moneyStarting a mobile game company? A mobile game business model is a monetization strategy developers use to drive revenue for their app. They can either choose to monetize through a one-time payment, in-app purchases (also known as microtransactions), or via ad monetization. One time payments relate to premium paid apps, essentially meaning users get your game for an upfront price. In-app purchases and ad monetization offer a more recurring revenue stream, increasing user engagement, platform experience, and in-game earnings.
Mobile game monetization modelsWith the worldwide mobile gaming market excepted to hit $76B by the end of 2020, developers are looking for new ways to monetize. Popular mobile game monetization models to add to your monetization strategy include in-app advertising, in-app purchases, and one-time payments. In-app advertising and in-app purchases, in particular, are crucial monetization strategies for F2P (free-to-play) business models.
- In-app advertising: There are several ad formats to choose from, such as rewarded videos, banner ads, interstitials, and offerwall ads.
- In-app purchases: With 53% of a developer's revenue coming from in-app purchases, it's no wonder why the microtransactions business model is one of the most effective mobile game monetization strategies. IAPs also let developers manage their sales directly.
- Premium paid apps: Developers can monetize with premium paid apps only if a mobile game has a strong value proposition and little to no competitors providing the same characteristics and quality within the genre. This model might turn away a majority of players accustomed to engaging with an app before they buy, but holding to high standards allows premium paid apps to do well in the app store.