Mobile Entertainment

During a panel discussion at a recent mobile gaming conference someone concluded: “No more excuses!”. You could see why. Most of the factors need to grow mobile gaming are in place: enough good handsets; decent product; mature ecosystem. There are no more revolutions to wait for, just execution and step by step improvements.

Perhaps we should start with retailing. We have lots to learn from both traditional physical retailing and the web. They can teach is a lot about packaging and pricing, delivering a personal shopping experience, depth and breadth of the offering and so on.

The fact is, in many markets we still primarily reach higher earning consumers, slightly older than one would expect for mobile games, usually post-pay, and often business users. Younger players are effectively shut out. To be more direct, the games cost too much for the kids!

A typical operator has 60 and 70 per cent of subscribers on pre-pay subscriptions, with an average account balance of a few Euros. They simply cannot make a spontaneous game purchase. We see clear evidence of that in transaction logs from many gaming portals there are a high degree of failed transactions due to “no funds available”. Consumers that wanted to buy, but had less than, say, €2.50 on their account.

This is a wasted opportunity. We must give these consumers what they want. Retail experience shows that if you drop the price enough, gaming revenue from prepaid users can grow up to 40 per cent. But obviously if we promote cheaper games too high on the deck, it can cannibalise premium priced games. Combine this with a typical pattern that consumers buy two or three games and then stick to these games for quite some time, and you have a difficult equation.

So obviously we need to refine our approach. Operators possess a wealth of consumer information they can use to segment consumers and then develop differentiated offerings for. It’s not rocket science. Secondly, here’s a lesson from traditional retail: A small tin of coffee cost less than a big one. So when we drop the price of a game we should also limit the licensing in some way. For example, pay €1 then play the game for just one day. This way we help pre-paid users make spontaneous purchases, while preventing them from stacking up on three cheap games and then not coming back again. We also avoid cannibalisation of premium users.

If we combine this ‘smart pricing’ with segmentation, add try-before-you-buy pricing and viral marketing schemes, and package this up in a good user experience, then we can genuinely addressconsumers that are today effectively shut out from mobile gaming.

Gaming to the people!