Microtransactions Need Alternatives

In the latest blog post from SaySo Rewards, we will be taking a look at a contentious subject in the gaming industry – the use of microtransactions. We will take a look at why game developers have gone down this monetization path and present our findings from a recent online survey we ran to gauge the opinion of the player when it comes to this topic. Whatever the opinion may be, microtransactions don’t seem to be going away and so we pose the question “What alternatives are there?” 

Recent History Of Gaming

First of all, let’s acknowledge just how much the gaming industry as a whole has grown. In a report by Satista, the gaming industry in 2018 has grown to a massive $115.34 Billion (yes with a B) in revenue. In contrast with $61 Billion in 2013, the industry has nearly doubled in only 5 years. Most noteworthy is that the mobile market accounts for more than half of this. Furthermore, this shows just how big the casual gamer audience has become which certainly makes complete sense. This is probably because it’s easy to play a quick game of PUBG or Candy Crush while commuting or killing time away from the comfort of home.

Big Games From Small Teams

Industry growth has seen with it a huge increase in indie developers. It seems like indie teams are becoming more predominant with some truly amazing titles. Games like PUBG, The Binding of Isaac and Terraria are certainly proving you don’t need a huge budget and team to create a memorable gaming experience. For that reason, if an indie game becomes popular then a free-to-play model can become a perfect monetization solution for a small team. Providing a source of funding for any future titles in the works. However, as a result of a saturated marketplace, it is becoming increasingly harder to break away and stand out against the crowd and microtransactions can more often than not, turn away players who simply don’t have the disposable income to throw at the variety of different games they may be playing.

According to a presentation from Mike Rose at 2018s GDC, an average of 40 games are released daily on steam. Furthermore, the average PC game will sell around $12,500 in its first month and $30,000 in its first year. You can read more on this here.

The most noteworthy insight from this presentation is that the revenue gained from game sales alone isn’t enough for developers to survive on, let alone produce more games. Consequently, this becomes the reason a lot of smaller teams flock towards the free to play monetization model as in many cases, they have no other choice.

Triple-A Games and Microtransactions

Similar to the indie developers, bigger studios have found a way to monetize gamers by combining the traditional premium model with the free to play model. This is done with built-in microtransactions acting as shortcuts to unlock in game items and cosmetics a lot faster than the normal grind would take. Take GTA V for example, the highest selling media franchise in history. Reports online suggest it has generated over $6 Billion (again yes that is a B) in revenue, with a sizeable chunk being made up of microtransactions in the form of shark cards.

Much to the chagrin of players, it seems like microtransactions are here to stay. There are pros to this, the main one being it keeps the wholesale price of games down. By modern standards, video games have not kept up with inflation, in contrast with other forms of media. But there is a major con in that many players detest even the slightest utterance of the term “microtransaction”.

So how do you take the stigma away from microtransactions? What if there was an alternative to additional in-game purchases? Something that above all allows the player to unlock in-game/in-app items and content, without having to fork out additional money.

Player Insights

We recently ran a survey for gamers and asked a very important question – “Would you take surveys in games to earn in-game content?” The results will probably surprise you.

First of all, to get a better understanding of our audience, we asked the close to 1000 participants some demographic questions. These are relatively straightforward questions to find out the age, gender, and household income of those surveyed.

 

 

Demographic Breakouts

Most noteworthy from the demographics is that a lot of those we surveyed are 41 years old or older. For that reason, you can conclude that the idea of young teenage boys locked in their rooms gaming all day is an outdated idea. As the industry has grown, so too have the players. These days, the definition of a “game” has been seriously expanded – you now have casual gamers, gaming enthusiasts, hardcore gamers and even paid, professional gamers. Unlike books, tv or film, you aren’t a passive observer, but rather an active participant; making the experience that much more engaging.  What’s great about this, is that the demographics that can be monetized through “gaming” have seriously diversified, and taking surveys to earn in-game rewards is often sought after by the majority of players, as they fall within the older age brackets.

Device Breakdown

As a result of industry growth, the audience as a whole diversifies. It seems like this in part can be attributed to the rise of mobile gaming and the casual market.

Question: Which of the following devices do you own?

It’s probably no surprise to see that over 68% of gamers surveyed own a Smartphone which backs up our previous comment on the rise of casual gamers and a more diverse market. Gamers nowadays certainly don’t need a powerful gaming PC or console to be able to game.

Hours Spent Gaming

Question: Approximately how many hours per week do you spend playing video games (including console. mobile and PC games)?

Most noteworthy here is that just under 30% of gamers play more than 11 hours a week. This number falls in line with what would be expected with your typical casual gamer with a substantion percentage of these survey participants leaning into the domain of a hardcore gamer. Our next 2 questions will be very important for the subject of this blog. We’ll also expand on them and show what this can mean for the industry and how it could change for the better.

Making purchases in games

Question: How likely would you be to purchase in-game items (microtransactions) in games that already cost full price to buy?

Completing Surveys in Games

Question: How open would you be to complete an online survey to earn currency in your favorite games so that you can get premium items, that normally cost real money, free of charge? Surveys would never be forced upon you and above all, you could take these whenever you had the time to do so.

These two charts above all, show how the current monetization model just doesn’t work for the average gamer. Furthermore, they show the potential loss in revenue for developers and loss in engagement for players.

As a result, 55% of people were not at all likely or slightly likely to do spend money on microtransactions in-game.

Compared in contrast, to the 86% of people who are slightly likely to complete an in-game survey,as a way to earn in-game items you can see, it is clear that players want alternatives. Microtransactions just don’t sit well with the vast majority of gamers.

A Change For The Better

It’s even more obvious now with the research that the current microtransactions model doesn’t work. It seems like we need to offer a solution for both player and developer. Something that allows for a sustainable revenue model, but above all, doesn’t segregate those who can’t afford or don’t want to pay for additional in-game purchases. The solution is almost too easy. You integrate a monetization solution, such as a survey offerwall.

Have a look at the video below, which explains a bit more about this form of monetization:

Alternative Monetization Solutions

In contrast to the old microtransaction monetization model, SaySo Rewards offers a great alternative. Furthermore, we’ve done the research and it’s clear that this is something gamers want to see more of in titles that offer microtransactions. So don’t segregate a sizable chunk of your core audience. Get in touch using one of the contact methods below to find out how we can help grow your revenue and keep your players happy.

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