Sources Of Revenue For Gaming Companies

Category: Games

Historically retaining players has been challenging for gaming companies as the game’s retention level is unlikely to exceed 5%. For the retained players that make an in-app purchase, some players are exceptional as they generate huge revenues for gaming companies. As pointed out by a Facebook study, 10% of the in-game purchasing players (“commonly called whales”) account for 90% of in-app sales, making them rare and unique for gaming companies. The gaming companies compete intensely for netting the “whales. As the number of games published increases, the competition to net the whales is going to get even more intense as just 20% of all new players acquired by gaming companies are ready to pay for playing a game. Thus, to remain competitive gaming companies must devise strategies to acquire new players, retain existing players, and turn them into profitable paying players/customers. The primary challenge for gaming companies will continue to be balancing spending on game development and marketing campaigns to acquire, retain and enhance the experience of whalers for repeat purchases. Quality data management and analytics have the prima donna influence in aiding gaming companies to make critical business decisions by gaining better knowledge about the players and providing vital insights to marketing, game development, and designs. Read our detailed article where we discuss strategies and case studies employed by gaming companies to leverage data for business benefit.