Pokemon Go has been making headlines since its launch. I resisted the temptation to download the app, but have since succumbed to my desire to be the very best, like no one ever was. Based in the US for my year-long NUS Overseas College program, I was able to download the app and become a Pokemon trainer. I have yet to become a gym master, but have caught a couple of cool Pokemon.
From the White House in D.C to Golden Gate Bridge in San Francisco to Chinatown in New York City, I have witnessed first-hand hordes of Ash Ketchum wannabes throwing Pokeballs to catch that elusive Pikachu/Jynx/Charizard. Pokemon Go is huge, and will only become even bigger as it rolls out in more countries.
How is Niantic (Pokemon Go’s parent company) going to cash in on this rocketship? How is Pokemon Go going to catch ’em all? Looking through Niantic’s blog posts, senior executives’ interviews dating back to the launch of Ingress (Niantic’s previous map-based mobile game) and recent announcements, I came up with the following 4 ways they are going to/can potentially monetize Pokemon Go and beyond.
In-app purchases
This is the most direct route to monetizing any mobile game. Get users addicted to a game and make them pay for items that help them level up faster. Pokemon Go has introduced Pokecoins that can be purchased using cash. Trainers can purchase perishable items like Pokeballs or Lure Modules to permanent enhancements like storage upgrades.
This has traditionally been the only way of monetizing mobile gaming, and it seems to be working pretty well for Niantic. I have not paid for any Pokecoins, but I feel that the in-app purchase has been structured in a way that does not deter people who are not willing to buy Pokecoins, while causing enough friction for hardcore gamers to spend some cash to unlock more features/stock more items.
Research done by Slice Intelligence found that Pokémon GO purchases surpassed the rest of the mobile gaming market on July 10th and accounted for nearly 47 percent of the revenue for entire mobile gaming market on the same day.
Chart published by Slice Technologies showing Pokemon Go In-App Purchase vis-a-vis All Other Mobile Games
Think Gaming estimates Pokemon Go’s iOS revenue based on in-app purchase in US alone is $1.85 million. Based on my back-of-the-envelope calculations, using estimates from Think Gaming, Newzoo, App Annie and Statista to estimate market size, Pokemon Go can yield approximately $26 million a day, upon complete roll-out internationally.
Sponsored locations/Pokestops
API for map-based games
Indoor mapping
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