Introduction

The process of creating a mobile game takes a significant amount of time for planning, designing and fixing. But when it comes to choosing of the primary distribution markets all becomes more apparent.  Western publisher traditionally goes to the “West” (the US, the UK, Canada, Germany, France, Australia, etc.), Eastern publisher - to the “East” (China, Japan, South Korea, Taiwan, etc.). All the countries mentioned above, despite the location, have something common - the huge revenue.

At the moment, China is an absolute leader of mobile games market with $10 billion of revenues in 2016. North America, Japan, and Western Europe going right after China with total revenues of $18 billion dollars as of last year. But what about emerging markets? And what is important to bear in mind while choosing a new promising market for spreading your mobile game? Let’s take a look!

1. Revenues

It’s not a secret, that the most of the publishers, mostly, keep in mind the possibilities of getting high profits and positive ROI, when choosing the markets for their mobile games. Usually the primal choice is English-speaking countries (United States, Canada, the UK, Australia, New Zealand) and it’s no wonder: these countries are the one of the most profitable and, at the same time, takes fewer efforts for developer (no need for localization) and it’s safer (these markets are well explored, culture is similar, so there are definitely less underwater rocks).

Switching from the Western part of the market to the Eastern part, it’s easy to emphasize China, Japan, and South Korea for tremendous revenues, which make the most of APAC region. Without these 3 countries, APAC is hardly able to outperform North America and Western Europe. But it’s matter of time: SEA (Southeast Asia) is the one of the world’s fastest growing mobile games region with mobile revenues, which are growing with an astonishing CAGR (2015 - 2019) of +45.3%, well above the global average of +14.6%. This region is also known for the high level of engagement among local players and the huge number of beginning players. Young mobile gamers are a major reason for the rapid rise in revenues in the region. In Indonesia, for instance, the difference between male players aged 10-20 and 21-35 is only 3%, while in Malaysia the number of the young female players is the biggest among all age groups.

Another important factor driving mobile game spending in Southeast Asia is how often people play. Gamers in the region often play mobile games on daily, providing game makers plenty of opportunities to cross-promote new titles and upsell existing customers on new game features.

Mobile revenues for the entire Southeast Asia region reached a mark of $1.5 billion in 2016, with about 95% coming from the “Big 6” countries: Indonesia, Malaysia, Philippines, Singapore, Thailand, and Vietnam. Rapid growth in these six countries over the coming years will lead to revenues of $3.9 billion by 2019, as was forecasted by Newzoo.

Among this “Big 6”, Indonesia is the fastest growing and largest SEA market in terms of revenues and Singapore is the smallest Southeast mobile market in terms of gamers but has the fourth largest revenues ($211 million) due to a very high average spend per paying gamer of $226.

LATAM (Latin America), consisting of Brazil, Mexico, and Argentina, as the main mobile markets in the region, is the second-fastest-growing region in the world after Southeast Asia. The mobile market in Latin America has grown from $0,9 billion in revenues from the segment for video games in 2015 to $1.4 billion in 2016 and, at the moment, take a mark of $ 1,7 billion with a strong tendency to grow and prediction to be at $3 billion in 2019, accounting for 48% of the gaming market in the region.

Last year, while PC and console gaming was taking up the majority of the market, 77% of paying console players in Argentina and 64% in Mexico were also spending money on mobile games, pushing mobile games on the top of revenue leaders in a segment of video games.

MEA (Middle East Asia) region is, for real, dark horse of mobile games landscape. For the last years, it was the least interesting region for the most of the game publishers due to several factors. It is generally accepted by western publishers to consider this region as a hard for entering and monetizing. Also, there is a strong prejudice that this market is unprofitable. Nevertheless, MEA, at the moment, one of the most grossing mobile markets in the world, with such revenue leaders in the region, as Turkey, Saudi Arabia, and UAE. Saudi Arabia, by the way, has the one of the highest average revenue per paying user in the world, which is about $270 (In China, for comparison, ARPPU is about $32).

2. Year-on-Year Revenue Growth

The last couple of years shows the strong leadership of MEA and LATAM, as regions with the biggest percentage of year-on-year revenue growth.

3. Smartphone And Internet Penetration

SEA

The relatively small online populations in Indonesia, Philippines, Thailand, and Vietnam will increase rapidly as the spread of smart mobile devices drives the internet penetration. In the same time, Malaysia and Singapore have already matured as markets with the huge percentage of people, owning a smartphone (51% and 87% respectively).

LATAM

The smartphone penetration index in Brazil, which at the moment, the most attractive country in LATAM for the most of the developers, remains quite low (48,2%), unlike in Chile or in Mexico.

In MEA region, UAE is known as a country with one of the highest indexes of smartphone penetration in the world (82,1%), with Saudi Arabia (76,7%) on the second place.

4. ARPU

The average revenue per user - the metric, which is quite different depending on a country with such constant ARPU leader as Japan, and game genre (a hardcore genres, like RPG and Strategy, have higher ARPU than casual ones). In order to create an approximate picture of ARPU index among emerging mobile game markets, we are putting a table with data below.

Averagely, the SEA market shows the best result in terms of revenues from each player on a game and we expect the fastest growth of ARPU in emerging markets exactly among Southeast Asian gamers.

5. CPI

Like ARPU, Cost-per-install also changes significantly depending on a number of variables, including platform, vertical and region. The range is truly wide, going from the lowest in the emerging mobile game markets of East Europe and Latin America to the highest when it comes to Per Loyal User in North America and the most developed countries of APAC. A “loyal user” has a different definition, but in the case of a game it can be considered as “reaching level 5” or “completing a micro-transaction.”

As was mentioned above, the difference between regions is truly significant. But what the difference between specific countries of the emerging markets? As we can discover from the data below, among three regions Latin America has the lowest CPI for both platforms. SEA countries have averagely the same CPI, except Singapore, which is quite more expensive for obvious reasons. In MEA, Saudi Arabia has the highest CPI for iOS, while Turkey - for Android.

6. Matter of Localization

Compared to such huge Asian mobile game markets like China and Japan, there is a much higher English proficiency in SEA, especially since it’s the official language in Singapore and the Philippines. But that’s not the same everywhere: according to the EF EPI, Thailand still demonstrates very low English proficiency, while Indonesia, the largest SEA market, only has moderate proficiency. So localization in these countries really makes sense.

Talking about localization in LATAM, should be mentioned that European Spanish (español) and Latin American Spanish (castellano) have enough of differences, so localizing two Spanish versions will be a good idea, considering that the LATAM mobile game market is bigger than Spanish mobile game market itself.

Localizing games in MEA region means a lot, especially, in GCC countries. At the moment, the absolute leader of the Arab mobile game market is Revenge of Sultans (انتقام السلاطين). Despite the fact that this game is a rip-off of Game of War and made not by Arabic game company, but by Chinese - it’s performing much better there than the original.  The main factor here is a full immersion into local history, customs and, of course, the presence of Arabic language.

7. Conclusion

In 2013, when the US mobile game market was almost a four times bigger than the Chinese, it was hard to imagine, that just in few years China will overtake the market leader and become the new world’s largest mobile gaming market. Who knows where will be the next mobile gaming "Sangrail"? At the meantime, game developers are able to get the most of the new and very promising game markets, as SEA, LATAM, and MEA, thanks to the following advantages:

Let's emphasize 3 countries from each of the emerging markets and summarize why these countries are cool:

Indonesia

With revenues of $331 million, Indonesia is the largest mobile games market in Southeast Asia. Indonesian mobile gamers have one of the highest day 1 retention rates in SEA and the highest day 30 retention rate among Southeast Asian countries on Android (4.4%) and iOS (7.7%). Also, CPI in Indonesia is one of the lowest in the region.

Saudi Arabia

The most of the game developers are used to consider the Middle East and Africa the last for new game releases. So MEA market is missing the quality well-localized mobile games. Among MEA countries, Saudi Arabia is the one of those, which consuming mobile products in significant amounts and is ready to spend money on it with the one of the highest ARPPU in the world.

Mexico

Not so far, Brazil has passed the leader's laurels to Mexico and now we are able to see the new LATAM leader in terms of revenues. With one of the highest growth rates among all emerging countries, high percentage of gamers who spend money on mobile games, and, finally, quite low CPI rate, Mexico looks really attractive as a decent market for upcoming and existing mobile titles.

This article was originally published on Zennaapps.com blog