The fact that in-game items can bind players more intensively to a title has long been more than a surprising side note for those developers and publishers who use such concepts in video games. Now, a study by the Frankfurt University of Applied Sciences shows that monetization models prove to be actual growth drivers in the games segment - or, as in the case of cloud gaming, could prove to be. 

Selling in-game items is lucrative. This is no longer a big surprise, at least since the overwhelming success of some well-known free-2-play games. Now, under the supervision of Prof. Dr. Lutz Anderie from the Faculty of Business and Law at the Frankfurt University of Applied Sciences specifically investigated various potential growth drivers under the microscope - with quite surprising findings.

The research results are based on a total of three quantitative and qualitative market research studies carried out by students in the Strategic Information Management and International Business Information Systems courses at Frankfurt UAS. A total of almost 900 users were surveyed, the largest block being a survey entitled "Empirical Survey on User Acceptance and Monetization of Top Selling Video Games" with 775 respondents.

Monetization: gamble longer, prefer to pay?

The games industry is spinning quickly, and developments sometimes happen rapidly, especially when it comes to new products and technologies. Monetization as the core of value creation is of particular importance. This is exactly where the Frankfurt researchers come in and essentially ask two questions:

  • How does an electronic game have to be constructed in order to generate income?
  • Which obstacles counteract this?

Prof. Dr. Lutz Anderie in his study entitled "Frankfurt Game Studies - Monetization Models and Cloud Gaming". The professor for business informatics at the Frankfurt University of Applied Sciences has now in the run-up to the Gamescom presented his research results. Among other things, Anderie comes to the conclusion that “in particular subscription models, cloud gaming and the in-game items offered during the course of the game, i.e. virtual goods, are emerging as growth drivers for added value.” Artificial intelligence also plays a role in being able to exploit potential.

What was previously suspected is confirmed: the longer a gaming session lasts, the more money players spend on in-game items. The researchers draw this knowledge from surveys carried out among games users. However, players simply and always do not give their money willingly: time delays, for example due to an inadequate data transfer rate, often impair the gaming experience and it is precisely then that the monetization potential cannot be fully developed. In other words, if you play longer, you pay more. But also: if you have less fun while gambling, you will probably pay less.

Titles like Electronic Arts' Apex Legends rely on an in-game shop. Photo: André Volkmann

Titles like Electronic Arts' Apex Legends rely on an in-game shop. Photo: André Volkmann

The researchers have found: With a game time of three hours, the vast majority of gamers spend between one and twenty euros per year on in-game items. 94 percent of gamers who play for four hours or more even invest 51 to 200 euros per year for in-game items during the course of the game.

The detailed results are exciting: The acceptance of in-game items is comparatively high despite the sometimes loud discussions. Around 54 percent of those surveyed have already bought virtual goodies, such as weapons, vehicles or cosmetic items. The money for digital in-game goods is almost a bonus for the industry, because: 97 percent of those surveyed who spend 100 to 200 euros annually on in-game items also buy paid games worth at least 50 in the same period Euro. A basic assumption, namely the channeling effect, sees Prof. Dr. Incidentally, Lutz Anderie refuted by his study: The willingness to buy in-game items is therefore no less if players have already had to pay a purchase price for the title.

Streamers are not automatically cloud gamers

Another result from the Frankfurt study also proves to be interesting. Even if the importance of subscription models, streaming and cloud gaming is increasing overall: Those who stream films, series and music at home do not show a higher affinity to cloud gaming.

Although 85 percent played games regularly (23,3 percent of them daily), only 11,7 percent have streamed a game in the cloud. After all: 73 percent know about the “Cloud Gaming” offer, the preferred gaming platforms with a share of over 50 percent are PlayStation and Mobile Phone.

The majority of the users surveyed have already heard of "cloud gaming" - but only a few have played in the cloud themselves. Photo: André Volkmann

Most of the users surveyed have already heard of “cloud gaming” - but only a few have played in the cloud themselves. Photo: André Volkmann

Technical inadequacies also seem to play a major role at the moment. Of those who use cloud gaming, 50 percent complain that they do not have a satisfactory gaming experience due to a lack of sufficient data transfer rates. Gamers experience that their game activities (e.g. in a duel) take place late in the course of the game. “Lag” leads to frustration.

The acceptance among gamers for Subscriptions is higher for gaming platforms (e.g. PlayStation Now) than for individual games (e.g. World of Warcraft): 55 percent of those surveyed have already subscribed to individual games, whereas 67 percent have subscribed to gaming platforms. “A more diverse range of gaming platform subscriptions is probably the reason for this,” says Professor Anderie.

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