Mobile gaming sees growth from in-app purchases in 2020

Revenue generated through in-app purchases of games on Google Play Store and Apple App Store in 2020 grew by 51.3% and 30.2%, respectively, over 2019, according to preliminary estimates by Sensor Tower, an app analytics firm.

The estimated spending on in-app purchases in Android games in 2020 was up from $76 million (approximately ₹550 crore) a year ago to $115 million (approximately ₹840 crore), while the spending on App Store was up from $45,4 million ( ₹320 crore) to $59.1 million ( ₹432 crore), as per Sensor Tower.

“Over the course of the pandemic, there has been a spike in gaming time, with more users moving from freemium to paid gaming apps,” said Prabhu Ram, head, Industry Intelligence Group, CyberMedia Research (CMR).

Six out of 10 serious gamers tend to purchase gaming apps, according to CMR’s recent consumer research for 2020. Four out of nine female users purchased gaming apps in India.

Real money gaming apps, which allow players to compete for cash prizes, also reported similar trends. During IPL 2020, the number of fantasy players on Mobile Premier League (MPL) increased more than seven times. WinZO Games saw a 10x increase in the number of paid players by the end of 2020 as compared to the previous year. “Our newly released games such as WCC by NextWave, Chess and Tennis have seen massive transactions in the last couple of months,” said Saumya Singh Rathore, co-founder, WinZO Games.

India has typically been a free-to-play gaming market driven by advertisements. The share of revenue from user payments has been lower than in other markets such as the US.

Industry experts point out that the growth in revenue from user spending in 2020 is mainly because of the increase in the number of users, rather than a huge shift in mindset toward payments.

“There is definitely some amount of conversion to paid users, but the growth is mainly driven by volumes. More people equal more revenue. There is still some barrier to paid gaming. The floodgates have not yet opened,” said Oliver Jones, co-founder and director, Bombay Play, a game development firm.