This is the presentation that our CEO Bill Grosso gave at the Silicon Valley Technology Innovation & Entrepreneurship Forum last weekend on mobile game revenue in the era of big data. Cowritten with Joost Van Dreunen of SuperData Research, the deck vividly illustrates how drastically mobile gaming has changed within just 3 years. For instance, premium paid download revenue dominated in 2012, but by 2015, has become just a tiny sliver, with IAP now accounting for 60% of total revenue, followed by advertising with 33%. (Scientific Revenue's internal data and research indicates that paid downloads are now just under 7% of the revenue pie, among other revenue streams.)
After the talk, two interesting audience questions for Bill came up, roughly summarized here:
Given the rate of change in mobile games, what should people focus on?
Bill: “Retention. At the end of the day, the huge and increasing rate of change means that you can’t afford to take your eye off the ball. In slow moving and traditional industries, you might be able to become an expert in secondary areas, such as acquisition and revenue, but with mobile games evolving so rapidly, it’s better to leverage outsourced expertise wherever possible, and keep yourself entirely focused on what makes your game good.”
What's the most surprising thing you've learned through the use of big data?
Bill referenced another SVIEF talk by Kabam’s Kent Wakeford, who explained all the adaptations the publisher made to Marvel Puzzle Quest, to make it appealing across multiple worldwide markets. "People are different around the globe," Bill added, noting that Scientific Revenue data shows that gameplay and game monetization greatly differ from person to person, demographic to demographic, and from market to market. "The world is getting flatter," as Bill put it, "but that's giving us much greater visibility into how different people really are."
For more background on that last point, be sure to read Bill’s latest blog post, Why Mobile Games Must Look Around the World for Revenue.