Presented by Sanlo
Alternative and additional distribution channels are currently hot topics in mobile gaming, and with good reason. They offer significant advantages to gaming companies: an additional source of revenue, as well as providing more favorable margins. There is immediate opportunity to impact the bottom line, prompting many companies to focus on the near-term financial gains of redirecting in-game sales away from app stores (with their 30% commission fees) to new channels such as webshops (with fees typically less than 10%). These savings boost profits and enable developers to offer special incentives to their players, ranging from ultra-premium items to discounts and freebies.
One crucial benefit often overlooked with webshops as a channel is the long-term opportunity for game companies to establish a direct-to-consumer (D2C) relationship with their players, free from Apple’s and Google’s dominance.
That’s one of the reasons why, here at Sanlo, we’ve added a new product to our platform — a plug-and-play tool for any gaming company to create and run a webshop.
Let’s break down the D2C opportunities in mobile games with examples from live games.
D2C enables powerful marketing opportunities
Selling consumer products — ranging from clothing, shoes and makeup to razors, sunglasses and mattresses — has been completely revolutionized by digital D2C channels. Remember when you would only think of buying these things from a store? Now, people go directly to the brand online. This enables D2C brands to gather data, personalize experiences, build deeper relationships and market directly. The application of specific D2C tactics in gaming will depend on game genre, title maturity, community maturity and much more. But, just for fun, here are a few examples that we’ve seen successful gaming companies use to establish and deepen their D2C relationships:
- Offer a discount for signing up for the newsletter with an email address. Huuuge Games does this in their Huuuge Casino title.
- Provide a free gift for creating an account, enabling tracking of customer actions across devices. For instance, Kabam’s Shop Titans offers daily/weekly free gifts to their registered players via their webshops.
- Recommend personalized items (either via email or on a webshop) based on browsing history, enhancing conversion and retention. A Thinking Ape’s Party in My Dorm is one good example.
- Send promotional emails for sales or special gifts to drive conversion and retention. Scopely’s Marvel Strike Force does a great job here, they send a weekly email with promotions that can be found in-game and on their webshop.
- Develop VIP/loyalty programs that reward players with points for every purchase that they can redeem for discounts and free items. Rovio’s Red Club loyalty program is a great example.
- Use email addresses of high-spending customers to create targeted audiences on platforms like Meta and Google.
However, many of these strategies aren’t possible in-app due to Apple and Google’s guidelines, which restrict the use of collected email addresses for spam or unsolicited promotions. Additionally, Apple allows for anonymity in account creation, preventing developers from collecting emails.
Mobile gaming must develop new skills
Creating direct relationships boosts revenue, retention and LTV. Ultimately, it provides an opportunity to establish an open channel of communication with players to build better games for them. Now, more than ever, it’s important to ship high-quality games that players will stick with.
However, to establish lasting and meaningful relationships with players requires mastering new skills, which are relatively new to the gaming industry:
Operating their own webshop and utilizing alternative payment methods (APMs) — Developers need to stand up their webshops and streamline checkout — mastered by the ecommerce industry, but still at its infancy in gaming. As part of that, some need to navigate APMs, crucial for regions favoring local payment methods.
Driving webshop traffic without platform fees — Apple and Google aren’t giving up their commission fees without a fight and they can still charge fees for purchases made via webshops depending on the nuances. Avoiding Apple and Google’s fees requires understanding platform guidelines and using effective traffic-driving strategies that don’t trigger fees.
Utilizing CRM, including data collection, privacy and security — D2C involves collecting player data for communications and ad targeting, necessitating new tools and compliance with regulations (like GDPR, CCPA and more). Expertise outside of gaming can provide valuable insights.
Don’t stress, help is here
The opportunity for game companies to establish direct connections with players is groundbreaking. This shift enables personalized experiences, targeted marketing and increased player engagement. This opportunity does require mastering new skills and understanding a range of complexities.
Fortunately, our team at Sanlo is tackling this opportunity and we’re all here to help. Learn more here.
Andrew Dubatowka is Head of Marketing at Sanlo.
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