Just Click and P(l)ay: Developers' innovative ways to monetise offerings

Abhishek Chakraborty Posted online: Sunday, Jun 08, 2014 at 0000 hrs
If you are a serious gamer, chances are that you would have come across scores of ads popping up on your mobile screen asking if you want to purchase extra moves, lives or magic potions. Some developers may take it a step further, especially if the app is ‘free’ to begin with. They are sometimes not just obtrusive to a point where they pretty much force you to pay up or quit, but also sometimes specifically engineered to get into your way and solicit clicks.

Most often than not, you may also be left wondering how that mysterious icon ended up on your smartphone’s home screen.

The bane that advertisements are, you would think. And yet, they’re there for a reason. After all, developers need to put bread on the table, just like everybody else. It is these ads that help you play your favourite game without paying a ‘premium’ for it. This especially holds true for a country like India, where about 99.5% of app users are not willing to pay for games they play, as per industry observers.

In a sharp contrast, smartphone gaming is picking up in India like never before. As per a report by Nielsen Informate Mobile Insights released last year, one in five smartphone users in India spend close to 15 minutes a day playing games, making it one of the most popular activities on the smartphone.

In general, most smartphone users in the country are light gamers and spend just over two minutes a day on smartphone gaming, but one out of seven are heavy gamers and spend over an hour every day, the Nielson report noted.

However, as the demand rises, so do the expectations of gamers who expect better graphics and quality in games. This is where the money factor comes in, says Manish Agarwal, chief executive officer, Reliance Entertainment Digital. “About 99.5% of Indian gamers are not willing to pay for games they play. But, as a developer, you need money to maintain the quality of the games you develop. So these ads come to our rescue,” he adds.

Reliance Entertainment Digital’s flagship gaming portal, Zapak.com, is a leading player in the country with offerings such as Reel Steel World Robot Boxing, Total Recall and F1, among others, seeing huge downloads globally. In India, the Chota Bheem series is quite in demand, says Agarwal.

Mahip Vyas, head, alliances and distribution, Games2win, a game developer, explains the revenue models for mobile app makers: “For developers, there are three basic options to choose from—paid apps, freemium apps (free apps with in-app purchases) and ad-based apps. Each option has its pros and cons. The choice of a revenue model would depend on the target market for the app. A paid app might do very well in the US or the UK, while a freemium app or a free app with ads might work wonders in emerging markets like India,” Vyas adds.

Games2win creates, publishes and distributes its own titles of mobile and online games. The Mumbai-based gaming portal claims to have one of the largest collections of proprietary games in the world with over 700 unique online games and over 50 unique mobile games. “Parking Frenzy, the company’s unique ‘parking game’, became the number one free game and number one free app on the US iTunes store in June 2012, driven to the top rank only by viral traffic and consumer popularity. Recently, Kursi Cricket—a game based on elections 2014—became one of the most popular games on Google Play with over half a million downloads. It is still going strong post-elections,” says Vyas.

Vdopia, a global leader in online, mobile video and rich media advertising, is increasingly seeing companies switching from the premium or upfront payment and ad-based models to the so-called ‘freemium’ model. “Under this, developers rope in more new players by offering games for free, but charging for in-app purchases at crucial junctures. Better genres and graphics get better valuation and as the number of downloads increases, so does the popularity of the game,” says Shivam Srivastava, director, business development, Asia-Pacific, Vdopia.

Vdopia is working closely with several national and international gaming publishers such as the makers of Talking Tom, Talking Angela and Need For Speed, among others. In the home turf, it has been working with Zapak and Games2Win, among others. “As per industry reports generated by Ficci and KPMG, the country’s total gaming industry is pegged at about R15,000 crore. The industry is set to rise to R18,000 crore by 2017 with a 40% annual growth rate,” adds Srivastava.

Kolkata-based Foreseegame, however, still banks on the traditional banner ads, which, as per Atish Roy, value innovator (head, creative communication) of the company, gives the advertisers better visibility. Foreseegame has seen brands like Puma, Dominos, Emami, Rupa and Sastasundar.com, coming out and advertising on their platform. “We have various schemes for our advertisers, which include subscriptions ranging from one month to one year,” says Roy.

Foreseegame, which makes prediction-based games and allows users to guess the outcome of future events, charges advertisers anything from R5-10 lakh for a one-year complimentary offer. The companies advertising on its site are also required to pay the winners if the players get their predictions right. “The most important thing that we have seen in our games is the number of returning visitors. About 80% of people come back to our site to play the game again,” says Roy. Since its launch in March 2013, Foreseegame has witnessed over four lakh members, with about 2,000-2,500 people registering with them every day.

Revenue models

Freemium apps: They may include various forms of in-app purchases, such as purchasing virtual goods like upgrades or speed-ups, buying additional functionality like levels or content, buying more time to use the app, paying to remove ads, or a combination of them all.

Paid apps: These applications don’t come for free. While most of the paid apps command one-time fees, you generally get 24 hours after purchase for refund, if need be. There are some that have a monthly subscription system.

Ad-based apps: Landing a sponsor is a great way to make money on your free app. Here, game developers put ad banners on the homepage of the sponsored app. While this gives more visibility to the brand, it also helps the developers earn sponsorship fees.

Paymium apps: Apps that are paid for upfront, with additional revenue being generated by charging for extra features via in-app purchases. They are still relatively unknown and, currently, only account for 2% of the apps on the App Store.