How telcos can attract and retain pre-paid gaming markets in Asia
You have spent hours fighting off enemy forces. Your troops are taking shelter before the swarm of trolls and gunslingers that are advancing fast, creeping their way inside your perimeter.
Your inventory empty and comrades wounded. All you’re left with is a shockwave grenade, but it won’t suffice.
Then he approaches. The Vampire King, a beast like no other, and you know you have come so far in the game. The success is within grasp. It’s just him now.
You quickly tap into the store to purchase the Obliterator Sniper Rifle. But then it all goes black. “You have run out of credit.”
When they reach the final boss, no player wants to be interrupted. They have been immersed in the game for so long and just want to keep on playing.
And the last message that a gamer wants to see is that they have run out of credit.
Of course, for postpaid users, this is less of a hassle, because there are no restrictions—they will simply be billed for all their in-app purchases at the end of the month.
Prepaid users, which happen to make the majority of users in Asia, the largest mobile game market in the world, are not that lucky.
Their story often gets intercepted by pop-ups due to the lack of credit or inability to make in-app purchases smoothly.
So in today’s blog post, we’ll look at how telcos can help remedy these minefields in players’ game experience, and how APIs can forge partnerships that benefit gamers, game makers, and telecoms.
Mobile gaming market in Asia
The Asian market is by far the largest gaming market in the world. And mobile gaming is its strongest rising segment.
By 2021, the region is expected to become home to 250 million mobile gamers and is likely to cash in $2.4 billion worth of revenue. Looking even further down the line, China, although dethroned this year by the US as the biggest gaming market in the world, is expected to continue to post strong growth. According to Niko Partners, China’s mobile games revenue will surpass $25 billion by 2023.
And the markets are becoming more open for Western developers and gaming companies as well.
The first step for gaming companies wishing to enter these markets, and telcos looking to partner with them, is to examine the market trends and patterns. The Asian gaming market is a diverse landscape brimming with business opportunities, but each separate market has its own peculiarities that need to be mastered.
For instance, in China, RPGs (role-playing games) are the most popular and most lucrative type of games. And coming back to the topic of seamless game experience—a study by Newzoo found that mobile players prefer immersive experiences.
This just goes to underline how essential it is for gaming providers to enable an uninterrupted user flow. And that’s where telcos can provide the necessary support, by sharing their assets through APIs.
In-app purchases are the main source of income for mobile gaming companies. A study by Newzoo and Mintegral found that in Japan players spent $371 per person on average in 2018, making Japan the No.1 market by annual spend per smartphone game payer.
South Korea is another market where mobile gamers are making a lot of purchases of in-game power-ups. According to Newzoo, in 2018, 85% of paying gamers spent money on virtual goods and in-game items. Interestingly, 39% of the online population watches video gaming content, and more than half of them use mobile devices to consume this content—an opportunity that telcos should look to seize.
But what might come as the biggest surprise is the perception of in-app purchases by mobile gamers themselves.
Asian gamers don’t mind in-app ads and purchases
In-app ads and purchases are the breadwinner of mobile gaming franchises. Despite the fact that they interrupt the gaming experience, ad monetisation is broadly accepted by players in Asia.
While consumers mostly perceive digital advertising annoying and intrusive, mobile gamers seem to understand the role of ads in enabling games to be free.
According to a study by Tapjoy, 72% of mobile gamers in Asia actually enjoy interacting with ads in exchange for in-app rewards or content.
Rewarded videos and playable ads have been on the market for some time, but it is the ease of in-app purchasing that makes these forms of advertising particularly appealing.
And this is the key lesson that content producers and telecoms should look into.
The seamlessness of customer experience is a decisive factor in making a product stick, and so efforts should be invested in that direction.
Different means of payment and the role of telcos
Unlike Western markets, where credit cards are used extensively, Asian markets rely more heavily on other means of payments.
Direct Carrier Billing is a widespread payment method, that in itself helps ensure smooth experience during online, or in this case in-game, purchases.
So the role of telecoms is more pivotal in the gaming world of Asia than elsewhere.
Customers rely heavily on being supported by their network operators during online content consumption. And this gives telecoms the edge to stay central and offer innovative products and services to a consumer base that counts hundreds of millions of consumers on a variety of devices.
There is one problem that telecoms looking to monetize on their existing capabilities need to address first, however, and those are prepaid users.
Ensure smooth experience for prepaid gamers
Throughout Asia, prepaid is still the dominant subscription model, with 82% of mobile users as prepaid customers.
Naturally, prepaid subscriptions generate the highest revenue. In fact, it is estimated that over 50% of revenue is generated from prepaid users.
But, the problem with a strong prepaid user base are high churn rates. With no strings attached and no agreements in place, there is never the assurance that your customers today will be your customers tomorrow. And this holds even more true given that prepaid users in Asia aren’t strapped for mobile network operators and can switch to another quickly.
So, any operator that offers the most convenient experience will be the one to win the woes of prepaid gamers as well.
So, what’s the solution? How can telcos, often perceived as slow systems due to their size be more agile?
Getting things done with APIs
With APIs, telecoms can swiftly utilize proprietary network assets and offer a superb user experience to gamers across Asian markets.
APIs are particularly useful to cater to the needs of prepaid gamers, as telecoms can offer services that would allow telecoms to achieve two goals.
One, telecoms could monetize on existing assets fast, without having to invest in a new infrastructure.
Two, telecoms would become desirable partners for game making companies, as telcos would play a pivotal role in delighting a devoted customer base of prepaid users.
So how would APIs be implemented to benefit telcos?
Through APIs, telecoms would allow game makers to tune into telco assets and offer their prepaid gamers a wholesome experience.
This means that regardless of how much credit they have left, gamers could make in-game purchases thanks to micro loans they would get from telecoms, like Apigate Stretch does.
Whether they offer e-wallets, DCB, micro loans, real-time credits, merchant credits, or carrier bundling, telecoms could offer a convenient way for gamers to secure uninterrupted flow.
So instead of broken user flow, prepaid gamers would be getting a full, immersive experience, without limitations to in-game purchases.
Breaking into the local market requires regional expertise
APIs in themselves are a way for telecoms to succeed in finding new sources of revenue and tap into a billion dollars worth industry.
However, the specificities of local markets require partnering with companies that possess the local expertise.
Regional dialects in countries such as Bangladesh, Myanmar, Vietnam, the Philippines, Indonesia, and India require that telecoms and gaming companies make substantial localization efforts, which can be a costly endeavor, but can pay off revenue-wise, as these markets are posting enviable growth, year after year.
Just last year, the mobile gaming market in Southeast Asia earned $1.4 billion dollars, while this year, the same figure is expected to reach $3.9 billion. So it’s best telecoms look for an established partner to help them reach 1.5 billion of gamers across Asia. At Apigate, we have the local expertise and access to billions of users that you could reach through a single API integration. Looking for ways to monetize existing assets? Get in touch and start delighting your prepaid customers today.