Nintendo’s first iPhone game has a long-term revenue problem – Business Insider UK

If you were expecting Nintendo’s first major iPhone game to
dominate the charts, earn billions in revenue, and dominate the
conversation, think again: While “Super Mario Run” is wildly
popular and was downloaded over 50 million times, the game’s
reportedly only made around $30 million. 


super mario runNintendo

That report comes from mobile gaming analytics firm
Newzoo,
which told the Wall Street Journal
that the game
was downloaded somewhere around 90 million times, meaning
just over 3% of people who downloaded the game actually
bought it. Thus, that $30 million figure.

$30 million sounds like a good chunk of gold coins, but
it’s a pittance compared with mobile gaming’s titans: Games like
“Clash of Clans” and “Candy Crush”
rake in billions annually

Another cause for concern: Those games are structured around
continuous buy-in, where you can keep spending real-world money
to get in-game items, power-ups, etc.; “Super Mario Run” is not
one of those games. You pay $10 just once, which means there’s no
ongoing revenue for Nintendo.


Super Mario RunNintendo

Just a few weeks after launch, Nintendo boasted over 50 million
downloads of the game, but that number includes people who
downloaded the free version of the game and never paid $10 for
the full version.

Worse: The people who didn’t pay for “Super Mario
Run” vastly outnumber the people who did — the percentage of
non-paying players is somewhere in the ballpark of 97%, according
to Newzoo. 

Worse still: That’s a slightly higher-than-average “conversion
rate” (the percentage of players who download a free game who
either buy the game or put money into it) among mobile games.

So, Nintendo’s game didn’t “fail,” in this respect — millions of
people are playing “Super Mario Run,” and several million people
paid $10 to play the full game. But in terms of generating
revenue, the game’s structure is standing in the way; few
are willing to pay $10 up front for a smartphone game, or
for most smartphone games, on a platform best known for games
being either entirely free or between $1 and $3. 


Super Mario Run (App Store)Apple

Apple’s App Store charts are a great illustration of this. “Super
Mario Run” is still topping the “Free” chart, but drops to
No. 14 on the “Top Grossing” chart, below free-to-play
titans like “Clash Royale,” “Game of War,” and “Candy
Crush.” Unsurprisingly, “Pokémon GO” still tops the “Top
Grossing” chart — it’s entirely free-to-play, but its developer
sells access to in-game items for real-world cash. Nintendo
benefits from this, albeit in a small way; only part of “Pokémon
GO” development studio Niantic, Inc. is owned by Nintendo
(Niantic is a joint venture between Nintendo, Google, The Pokémon
Company, and several other investment partners). 

Since “Super Mario Run” uses the traditional “premium” payment
model — pay a substantial fee up front for full access to a
product — the game seems to be languishing on Apple’s App
Store. That is, of course, unless you factor in the immeasurable
importance of “Super Mario” run as an introduction to Mario for a
new generation of game players.


Super Mario
Dave
Hunt/Flickr


The generation of kids who grew up playing “Minecraft” on an
iPad alongside Nintendo’s soon-to-be-abandoned Wii U game console
are, assuredly, a major target for Nintendo. These are
millions of kids who’ve maybe heard about Super Mario, but
have yet to play the Super Mario game that they’ll
forever wax nostalgic about. Or, in the parlance of the
market, these are untapped consumers. 

In that case, Nintendo is depending an entirely different
“conversion rate”: the millions of kids who played “Super Mario
Run” on an iPhone to become the kind of consumer who will buy
Nintendo’s hardware, like the upcoming Switch console.

Nintendo’s “Super Mario Run” is available now on iPhone and iPad;
it’s free to download and try, and $10 to unlock the full game.
It’s heading to Android phones at some point in the future.

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