Swrve, the world’s leading mobile marketing automation platform which processes more than 6 billion events a day across a billion devices, recently released a report on mobile gamers’ in-app purchasing patterns. While most people don’t make purchases in-app, the very small percentage of top spenders, also known as whales in the industry, account for the majority of revenue. In fact, the study found that over 60% of all in-game revenues are generated by only 0.23% of all players.
In January 2014, Swrve found that only 1.5% of active players made an in-app purchase (IAP) at all within that same month. When they ran the same analysis a year later for this report, 2.3% of players made a purchase within that month. While this is a jump, this shows us that the vast majority of players are not contributing to revenue.
The average monthly spend is $29.17, up from $22 last year, an increase of nearly 33% that likely reflects the increased sophistication of mobile marketing efforts. That total comprises about 3.5 purchases per month with an average value of $8.27.
We can see that 44% made one purchase, down from 49% a year ago. Also, 20% of paying players make five or more purchases, up from 13% in last year’s analysis. According to the report,
This confirms the upward trend in spending patterns and is an early indication of a key trend in this report: the increasing dependence of the freemium games model on a small percentage of paying players.”
The report also found that the top 10% of players who spent money on IAP accounted for 64% of all measured free to play game revenue for the month. Last year, the top 10% of spenders only accounted for an estimated 50% of total revenue.
Christopher Dean, Swrve’s CEO, said in a statement:
The numbers are clear: the mobile games space is changing and growing. Although still reliant on a relatively small but growing number of players, there is a clear trend towards a broader payer base and a more sophisticated approach to driving revenues. We’re leaving the ‘acquisition phase’ of mobile, as developers realize that success is determined by what happens after the install.”
Swrve said the report was restricted to free-to-play games and examined 30 days of behavior for all players playing a game in January 2015. Data was collected from over 40 titles, and reflects the behavior of more than 20 million players.