First off, I would like to point mobile developers to an external pdf – Essential Facts about the computer and video game industry by the Entertainment Software Association. This is a detailed review, primarily, of the American video game market. Personal computers remain the dominant gaming platform, followed by consoles and mobile devices (generally opposite the international norm).
My stance is that personal computers and mobile devices are becoming more and more alike. While there are definitely differences, personal computers have been around for a lot longer providing some historical market context for those willing to take a look. Leastwise, many games that were once made for PCs are now available for mobile devices.
What is surprising, and should not be, is that the average age of gamers in the United States is 35. The overall breakout runs:
It is also noteworthy that of 155 million gamers in the United States, 44% are female.
This tends to put a different slant on why many developers are not breaking even, aside from not actively engaging marketing and advertising. A quick look at the games on virtually every mobile app store gives the impression that their target market is a “younger audience” – if not under 18, then certainly under 25 (splitting the age bracket). It’s not that they don’t have a clearly defined target market as much as the competition is “extreme” for that target market. We can also infer that this target market is subject to limited discretionary spending – likely dependent upon parents for their money to purchase games.
Functionally, there are far fewer mobile games being marketed to the 25+, and especially the 35+, crowds where the most likely spenders are found. Their interests appear quite evenly divided across social, action and puzzle game genres, but only socially-oriented mobile games have attracted their attention. Action and puzzle games are not, setting aside online gambling and casino-like games.
It is easier to develop a game for a younger audience than a possibly jaded older audience. Those willing to pay (more) tend to expect more. “More” or “better” is not always concerned with graphics, but the game engine and AI itself. If someone is 35 today, they were likely playing video games on their PC or console in 2000.
Within that context, I can say from personal experience that it is very difficult to find a game (of any sort) that offers significantly better game play than some of these older games. There are the “industry standards” which have gone through several versions since – whether we want to reference Syd Meier’s Civilization, Paradox’s Hearts of Iron, Metal Gear, Call of Duty, Grandtheft Auto, or even World of Warcraft. A lot of good games then were somewhat ahead of their time or devoted to too small of a niche (then) and have become “abandonware” or picked up by distributors for ongoing release at massively discounted rates.
Yes, those are mostly PC titles, suffice that many games that were PC “yesterday” could do well on “mobile” today, and some are.
Old software does not have to die. If it was good enough “back then” to get an official release in a box on a physical store shelf, there’s a decent chance that a facelift and makeover could resurrect its playtime today. As most of the game mechanics and code have already been defined, the main challenges involve porting them to a new platform and/or language, improving upon its initial faults and perhaps adding a few new components to the game. Those inclined to explore this direction, of course, would need to track down previous developers and publishers to negotiate a license for continued development.
But more to the point of marketing to older gamers is taking a look at all of the different kinds of games they have likely played in the past. What was popular? When and why? How could a particular PC game be adjusted to work for mobile? There are many reasons why most mobile app developers are not breaking even, suffice that where the US market is concerned, too many are competing for too small of the paying market.
The number one goal with this blog is to help mobile app developers make money, to be profitable. There are many components to building a profitable business and continuing to increase its profitability. It is useful to underscore that 65% of developers are not breaking even with their apps; and likewise; roughly 65% of developers engage in little to no marketing, advertising or distribution efforts. Again, what applies here to mobile app developers applies broadly to most businesses.
One other point needs to be made, in line with the Pareto Principle, 80% of the work you do is responsible for only 20% of your revenues; implying that the other 20% of your work is responsible for the vast majority of your earnings. That is, it may take 2 or 3 months of full-time work to produce a mobile app, all of which earns you nothing unless you are being paid to develop it for someone else. It is EVERYTHING you do after you’ve finished the app that makes you money.
Developers… develop. Most developers don’t like spending their time on other things like marketing and distribution. Nevertheless, it is worth spending 1 or 2 hours a day (20% of your work day) engaged on building your business. You will benefit accordingly.
The number one question is whether you are going to everything by yourself or if you are going to do it with someone. This is your choice, where your other options are to bring in partners or to hire someone. If you don’t have the money to hire someone, then your best bet is to try to find a partner, an agent or gradually outsource work as you can afford it. These are all things that I’ve covered previously (see the Guide), but I do have a few things to add.
Partnerships. Subject to your local business laws, there are all kinds of ways to form partnerships with two or more people. It is not necessary for all partners to have equal shares, equal say or even have a salary. My first commercial business endeavor involved a partnership with four people where our lead programmer retained a 40% share with the other 3 of us having 20% each. Of special interest here is that we were able to pull in a senior VP from a major cable company who was only responsible for providing 2 hours of guidance per week.
The main point, it is possible for new companies to bring in high quality talent without necessarily paying anything. There is a generational divide in that many mobile app developers today are young (20 – 40) at the same time as there exists an massive and underutilized pool of very experienced retirees (45 – 70) who would be happy to contribute in building a new business. In the other direction, there are plenty of college students graduating every year unable to find regular jobs.
Functionally, it all boils down to there being a lot of people without a product to sell or who fundamentally do not want all of the responsibilities that come with having their own business. As a mobile app developer, you are able to produce products which you can use to attract the people to help you build a profitable business.
Outsourcing. There are likely to be many occasions where you need something done that you cannot or do not want to do, for whatever reason. Many of these things reside in the “only need to do it once” category – like creating a company logo or business card, writing an app description, or even getting your apps set up on different app stores. You might also be looking to localize your app or its description, getting press releases written and distributed, or getting a web site up. There are literally hundreds of different things involved in developing, improving and promoting your business. These don’t need to be expensive:
When it comes to any business venture the more you have “for show” the better you will fare – true whether you are a mobile app developer, in online sales or run a brick-n-mortar establishment. Prioritize your needs based upon what is likely to provide you the quickest return on your investment. You always have the option to do it yourself, possibly learn a new skill, save money and increase your potential for making money in the process.
China or India? Brazil or Mexico? The United States or the European Union? How do you determine the markets you should enter? That there are many variables to consider is an epic understatement. The points addressed here can help anyone identify their best market opportunities. This article is the first part of a white paper being prepared to support indications that only a minority of developers engage in marketing, and even fewer do market analysis. And yet it’s not difficult, by the time we’re finished — it will be pretty easy.
Freely available data sources are referenced wherever possible. Some data will require personal research and may not be readily available. Still, there is enough information readily available online whereby anyone can get a good rough idea of where to concentrate their efforts without knowing a lot about marketing.
Important for future perspective and helping to understand some of the broader dynamics in play. Total country population is relevant only as it is likely to influence where you start looking to market your apps. Bigger countries = bigger markets, right? Well, maybe.
Find Country Population:
It’s impossible to dismiss the importance of average income when it comes to evaluating prospective markets to target. There are several factors to consider.
The two simplest components are average income and purchasing power parity. Average income in US Dollars is typically defined by a country’s GDP divided by its population.
Purchasing power parity equates those US Dollars to what people can buy locally. A good point of reference for this is the Big Mac Index – measuring the cost of a Big Mac in different countries around the world. In Norway, a Big Mac is over $9.00, but in China might be less than $2.50. In essence, the app you are trying to sell to the North American Market for $3.00 won’t make headway in most other markets at the same price. This gets into market and price segmentation.
Some countries have a purchasing power parity significantly better than its GDP may indicate. Income influences pricing and price can dramatically influence interest in a premium app, freemium upgrades and costs of in-app currency.
There are a LOT of other factors appropriate to mention, though most of them apply to fine tuning marketing campaigns. Wealth distribution, unemployment rates, urban vs. rural population and wages, discretionary income, seasonal spending trends, etc. can all be useful points to consider.
Find GDP per capita:
Find countries by Purchasing Power Parity:
Finding the approximate number of devices and mobile subscriptions by country is relatively easy. It is essential to factor in the number of people who have multiple devices and mobile subscriptions. In the United States, it might sound like everyone has a mobile device. More accurately, the average US mobile user has more than 1.5 devices – reducing the eligible market to about 238 million people. Determining unique users is more difficult and in the absence of research results may require you to make an estimation.
Find number of mobile devices by country:
Many countries have more than one common language. Overall usage levels require research to determine the extent of overlap. Within our global environment, many languages carry weight far beyond national borders. Ignoring immigrant and diaspora communities dismisses some key language-specific revenue sources, frequently wealthier than their native communities.
If you develop and localize an app for a specific language, it makes sense to examine all of the countries in which the language is spoken. Additional localization components may be necessary.
Most Spoken Languages:
Languages by Country:
Playing a major role in breaking out likely users, age and gender both have an impact on app usage tendencies. Age (income and wealth distribution) tends to have the strongest impact on overall credit card holding rates.
We are talking in terms of averages here – broad classifications to which there will always be exceptions. The two oldest age groups (55-64 and 65+) can mostly be factored out of calculations, or given reduced weight in calculations. Likewise, the youngest age group (0-14) will not have credits cards and only developed markets will have any appreciable number of credit card holders in the 18 – 24 age range.
Demographics by Age & Gender (and a lot more):
Outside of developed markets, credit card usage can vary widely and the same applies to the ever expanding field of alternative payment systems. If you have a paid or freemium app, or one that allows the purchase of in-app currency, you need to have payment systems that match those available to your end users – customers.
Credit cards are the standard for most developed countries, typically working in conjunction with services like Paypal. Mobile phone payments like M-PESA in Kenya are showing signs of real growth, but frequently require an in-country presence for a business to establish an account. The proportion of people within a country having access to these payment systems requires research and that data is not always readily available.
Initiatives by Visa and MasterCard can be expected to substantially increase Africa’s market share in the years ahead. Developer-level partnerships can also pave the way for more effectively accessing developing markets, too. For example, if you or a trusted partner has an account able to accept mobile phone payments within a country can make a world of difference in your marketing strategy and app’s profitability.
One source of useful credit card information can be found on the Visa site:
Credit Card Market: Economic Benefits and Industry Trends by Scott Schmith
With all of the above factored, you are getting closer in defining your app’s target market. Your next step is to determine what portion of the market is using the combination of platforms and devices compatible with your app, i.e. Android, iOS, Nokia, Java or HTML5, and the like.
Awesome Resource for PC and Mobile Statistics:
Enough data is available to indicate that users of specific devices have preferences for specific types of apps – education and learning vs. travel or utility vs. gaming. Just within the games category, there are all kinds of genres, from strategy to puzzle, shooters and adventure.
There’s no single source of data for this kind of information. Different networks have their own statistics and what might be said for Apple devices tends to be quite different for Android.
These factors, 3 – 8, are primary factors in determining the overall number of people within a given market or country who might be interested in your app. This provides you the upper ceiling for your app.
No two campaigns are exactly alike. What you are able to establish through collecting the information in this article will go a long way toward establishing your total market. Reaching your market — well, that’s another story and will be treated in the second installment. Feel like experimenting? You can add your app to the Opera Mobile Store or begin your own advertising campaign in minutes.
Many, many more factors go into setting up a proper marketing campaign. Some campaigns seek to saturate the market; others aim to pick up maximum customers with a very limited ad spend. And there’s everything in between.
Of interest is your ability to better compete with the bigger players — development companies that do have a dedicated marketing team.
Opera Mobile Store has a Do-It-Yourself Advertising Campaign Manager to help you get a boost for your last minute holiday advertising. This is good for developers who already have their apps on Opera Mobile Store.
You don’t have your app on Opera Mobile Store? Take the time now to do so. There’s still some time before the holiday to get your app registered and to start your own campaigns. Lots of people will be getting new smart phones, tables and other electronic goodies and will be looking to add apps for them during and after the holidays!
Advertising with Opera Mobile Store enables you to reach mobile users that you are not likely to reach otherwise. The vast majority of our customers use the Opera Mini browser and have Opera Mobile Store on their speed dial. Opera is attractive for customers in many countries because our browser compresses data to help save on bandwidth and data usage fees with carriers. Registration of your apps on Opera Mobile Store is also free, unlike on Google Play or the App Store.
Starting a Do-It-Yourself Campaign Manager requires an initial deposit of at least $250, that you can add directly via PayPal or your Credit Card.
It would be an understatement to say that the Nokia X series did not go as planned. Released in February 2014, the series was cancelled in July of the same year following Microsoft’s acquisition of Nokia. While total sales figures for the Nokia X series are not available, it is known that at least 16 million devices were shipped in 2014. An estimated 10 million were sold during pre-order, theoretically including up to 4 million in China.
While the intention here is to focus on Nokia X, much of what can be said applies equally (or even more) to all Nokia/Symbian devices. While not the largest app market, it is large – and tackled properly, even Nokia X can represent an “economy of scale.” There are many different marketing strategies, but let us boil them down to two basic ones:
The Nokia X and Symbian markets are examples of that second strategy. Many developers have dismissed the entire Nokia X and Symbian markets because they are smaller than the huge Android market. That is actually good news for mobile app developers able to see the marketplace in strategic terms and who are more opportunistic in their development efforts.
The Pros of the Nokia X and Symbian markets outweigh the Cons, quite substantially.
There are two primary downsides to the Nokia X and Symbian markets. First, it is a smaller market. Second, it is somewhat more difficult to monetize. We will come back to that second point shortly.
The following points can all be construed as favorable and beneficial for Nokia/Symbian developers:
I don’t have present figures, but a total of about 120,000 apps were developed for Symbian – with 1.6 million apps designed for Android and another 1.5 million for iOS. Of those 120,000 Symbian apps, many are no longer in circulation and many others are not being actively updated or upgraded.
The point here is that competition in the Android and iOS markets is intense and you are competing against some of the largest developers in the industry. That’s not your only option – and not necessarily your smartest option.
Nokia X was an effort to make an affordable full-feature smartphone for people living mainly in developing markets. That directly implies that most are not likely to have credit cards, Paypal accounts, or a lot of discretionary spending money. So, yes – it is more difficult to monetize apps with this target market.
I’ve heard it said that people in developing markets don’t buy anything… That is absolutely NOT true, as for starters they purchased a $100 smartphone. It may be more accurate to say, that at least in the past, many could not make online purchases owing to the paywall. Payments via mobile carrier have and will continue to offset this obstacle.
It is fairly consistent throughout the mobile app market that the vast majority of app revenues (aside from in-app advertising) are derived from a small minority of users. This follows the Pareto Principle quite closely wherein the “convention” is that 80% of the market sticks to free to play; but 20% are likely to buy something (that 80% of revenues come from 20% of your end-users).
The super-user segment focuses on the top 20% of that top 20% – essentially, your top 4-5% of paying end-users will likely be responsible for 65% of your in-app store/upgrade revenues. When you have a large base of end-users, you may also see that there’s a sub-1% user group responsible for nearly half of your revenues.
Most app developers are still generating some portion of their revenues from in-app advertising on a free to play basis. That strategy is well-suited to Nokia X/Symbian market and vastly simplifies your marketing effort.
For starters, you need only have your app on Opera Mobile Store to be accessible to the vast majority of active Nokia X/Symbian users. Registering on Opera Mobile Store is free, unlike Google Play or the App Store. The greatest results, as one might suspect is getting your app into the Top Section – easier than you may think.
It should be remembered that the Nokia X line was introduced as an entry-level device, with the long-term interest of Nokia X users upgrading to Lumia devices. For developing countries, the lifespan of a device can run from 6 to 10 years – from what we’ve observed historically. Sooner or later, mobile users will upgrade their smartphones – probably to Android or iOS. A bit of strategic planning and development can help you retain your Nokia/Symbian customers when they do go to upgrade.
A little bit of trivia may get you to thinking about the benefits of long-term planning – In the 1970’s, average wages in Singapore were around $600 per year; today – average wages run nearly $62,000 considering purchasing power parity. Median wage in the United States is about $51,000, in comparison. Perhaps the easiest way to big-time success comes from being the first to get established in a market where no one else or few are competing.