Weekly Gaming Reports Recap: April 22 - April 26 (2024)
EY shared the India market intel; SocialPeta spoke about marketing trends in Japan; CHZZK is the new growing streaming platform in South Korea.
Reports of the week:
SocialPeta: Marketing Trends in the Japanese Mobile Market in 2024
GSD & GfK: 38% of games sold in the UK in 2023 were physical
Ernst & Young: Gaming Market in India in 2024
Newzoo: Top-10 Games by Revenue in the USA and Europe in Q1'24
StreamElements & Streams Charts: Streaming Market in South Korea in Q1'24
SocialPeta: Marketing Trends in the Japanese Mobile Market in 2024
Before we start, I’d like to add a note to my post from April 18 - Konvoy Ventures: Investments in the Gaming Industry in Q1'24.
The report mentioned that there was a $20M deal with Halfbrick Studios, while in reality, it’s never happened. Thanks to my friend from InvestGame.net for pointing out this mistake in my writing and the report.
Market Overview
The Japanese market is conservative. There are 14.6 thousand advertisers on it; 62.23% of them had new creatives in the last year. The average worldwide figure is 72.31%.
On average, there are 81 creatives per advertiser per month. Of these, only 29.77% are new; the average worldwide figure is 59.68%.
The largest number of advertisers in the country are among developers of casual games (32.61%); puzzles (13.4%); and simulator developers (11.35%).
In Japan, over the past year, the share of video creatives was 80.17% (compared to 68.33% on average worldwide); static creatives accounted for 14.6% of the total volume (compared to 24.02% worldwide). However, over the past six months, the situation has changed, and Japan has approached global standards in terms of volumes of video and static creatives. Over the past six months, the share of Playable creatives in Japan has doubled the average worldwide figures.
Japanese Market Trends
In Japan, pre-registrations are actively used. Advertising launches 30-90 days before the project's release.
A good example of this approach is Legend of Mushroom. The project's advertising campaign started on iOS on January 18 and Android on February 2. Meanwhile, the game itself was released on February 22.
In Japan, it’s common to celebrate project anniversaries; large gaming events are launched for this purpose, and the event is actively promoted.
Brand collaborations in Japan are the norm; game developers often use this tool.
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Japanese creatives have their specifics. They are bright, many have exaggerated emotions. Because the market is already mature, creatives with old-school references are used (for example, Legend of Mushroom references the startup screens of classic JRPGs).
GSD & GfK: 38% of games sold in the UK in 2023 were physical
EA Sports FC 24 - the best-selling game in the UK last year - sold 2.395 million copies. 67.2% of them were digital.
In the top 20 of the British market, the lowest digital sales figure is for God of War: Ragnarok - 24.3%.
The highest digital sales figure is for NBA 2K23 - 87.1%.
Without Nintendo games included (there is no information on digital sales for them), then it turns out that in the UK, only 38% of the volume in the top 20 sales was sold in physical format.
Ernst & Young: Gaming Market in India in 2024
The consulting company has prepared a report on all sectors of entertainment in India. I'm publishing only the part related to games.
State of the Market
In 2023, the volume of the Indian market amounted to 220 billion INR ($2.64 billion). Out of this amount, 182 billion INR ($2.18 billion) is revenue from real money games (poker, rummy, fantasy sports, etc.). The remaining 38 billion INR ($0.46 billion) is income from "casual" games, eSports, and other classic gaming experiences.
❗️EY refers to casual games as projects that do not involve real money cash-out options.
The gaming market in India is the fourth largest by volume after television, digital media, and surprisingly, print media. And it's the fastest-growing.
The Indian gaming market grew by 22% in 2023. Real-money games grew by 21%, while casual games grew by 24%.
Around 90 million players in India paid for games in 2023.
Shooters are the favorite genre in India, excluding various variations of table and card games for money, which generate 24% of total revenue.
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The number of gamers in India reached 455 million in 2023, second only to China. EY estimates that 100 to 110 million people play in India daily.
India is the world's largest market in terms of downloads. 25% of the total volume is attributed to hyper-casual projects.
Indian Market Growth
It is expected that the Indian gaming market will grow to 388 billion INR ($4.7 billion) by 2026. The market will grow by 21% annually.
In-game purchases (27% CAGR), fantasy sports (23% CAGR), and rummy with poker (19% CAGR) will grow the most.
By 2026, the share of real money games in India will be 83%.
RMG Games - Current Status
RMG - Real Money Gaming.
Out of the 182 billion INR ($2.18 billion) revenue in 2023 from the RMG segment, 37% was from rummy and poker, 53% from fantasy sports, and the rest from commissions in other projects.
In October 2023, regulation of real money games was introduced in India (a 28% tax on deposits was introduced). This led to layoffs and risks for smaller companies. However, the situation now looks like major players have found a way to optimize to continue business.
There is a risk that the 28% tax will be applied retrospectively. Industry players have already said that this will kill their business.
Google announced the allowance of the publication of skill-based projects on its platform in India, making it easier to access the audience.
EY expects the market to consolidate by 2026.
Real-money games are not allowed in all states of India. There are states where you can play poker but not fantasy games.
Classic Games Market
Out of 38 billion INR ($460 million), 37% is spent on in-game purchases, 34% on advertising, and 29% on eSports.
Spending on IAP purchases grew by 55% in 2023 due to the release of Battlegrounds Mobile India in May 2023 after a two-year ban. The game has been downloaded more than 100 million times since then.
As previously written, shooters account for 24% of all IAP revenue with 5% of downloads. The next genre by revenue is strategy (14% of total IAP payments with 1% of downloads). In third place are Match games (12% of all IAP payments with 6% of downloads).
The number of streamer views increased by 20-25% in 2023, especially in Tier-II cities.
Esports in India
In 2023, 1.79 million people participated in esports competitions. It is expected that in 2024, their number will exceed 2.5 million.
78% of surveyed EY players participated in esports competitions, and all watched at least one tournament in the last month.
In 2023, there were 22 esports teams in India. In 2024, this number will increase to 35.
In 2024, there were 19 esports disciplines on the market. A decrease to 14 is expected in 2024.
The return of Free Fire competitions is expected to increase prizes. Growth in views is also expected.
In 2023, women made up 23% of the entire esports audience in India. And there is a trend towards growth.
Portrait of an Indian Gamer
Almost 13,000 gamers were surveyed; 94% were under 34 years, 90% were men, and 88% were single.
40% of Indian gamers played almost every day in 2023.
43% of respondents said they played more in the last year.
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48% of Indian gamers play for more than an hour per session. A third of respondents don't have dedicated gaming time.
44% play for fun and stress relief.
When choosing a game, users value its popularity (32%) and store rating (23%).
60% of Indian gamers prefer multiplayer games.
30% of Indian gamers watch streams on a daily basis. 45% spend more than 2 hours a day on this.
58% of respondents consider it normal to spend money on RMG games. This is 19% more than the previous year.
54% of paying players spend less than 500 INR ($6) per month.
Almost two-thirds of respondents either are ready to or already have a gaming subscription.
52% paid to play fantasy sports in 2023.
Users avoid RMG games due to fraud risks (33%), gaming addiction concerns (25%), and mistrust of platforms (24%).
Newzoo: Top-10 Games by Revenue in the USA and Europe in Q1'24
In Europe, Newzoo includes the United Kingdom, Germany, France, Italy, and Spain.
Overall Picture
Fortnite - the revenue leader in the first quarter of 2024. EA Sports FC 24 is in second place; Helldivers II is third. Surprisingly, Dragon’s Dogma II has surpassed Palworld in revenue.
Fortnite accounts for 10% of all revenue in the past quarter; EA Sports FC 24 - 8.3%. For comparison, Tom Clancy’s Rainbow Six: Siege, which is in 10th place, only accounts for 1.6% of total revenue. The difference is significant.
4 out of the 10 games on the chart are annual releases (EA Sports FC 24; NBA 2K24; Madden NFL 24; Call of Duty).
Of the top 10 games released in the first quarter of 2024, only 2 are new IP. These are Palworld and Skull & Bones.
Distribution by Markets
The USA accounts for 70% of the revenue from the total volume of the markets tracked. Fortnite is the leader there (11.2% of all revenue); Palworld (8th place), has 1.86% of the first-quarter revenue in the USA.
In Europe, EA Sports FC 24 accounts for just over 20% of all revenue. Fortnite - 8.4%. Helldivers II is in third place with 6.4% of the European market. Hogwarts Legacy continues to sell well - 10th place in Europe (1.3% of total revenue).
PC Market in Q1’24
Helldivers II accounts for 8.56% of all PC revenue in the first quarter of 2024; Palworld - 6% (comparable to Fortnite).
One of the main hits of 2023, Baldur’s Gate III, accounts for 1.3% of all revenue in Q1’24.
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In the USA, Fortnite is in second place (6.8% of all PC revenue for the period); whereas in Europe, Palworld is preferred (8% of the region's total revenue in Q1’24).
Console Market in Q1’24
Fortnite accounts for 12.8% of all console revenue in the first quarter.
In Europe, EA Sports FC 24 dominates, accounting for over 36% of all European console revenue in the first quarter. In the USA, the best sports simulator is NBA 2K24 (8.1% revenue).
In total, sports games from the top 20 chart in Europe account for 41% of the total sales volume on PS and Xbox. In the USA, sports games account for 23.5%.
StreamElements & Streams Charts: Streaming Market in South Korea in Q1'24
Twitch announced the leaving of the South Korean market, which prompted competitors to become more active. AfreecaTV announced a rebranding to SOOP and its launch in global markets in the first half of this year. Naver launched its CHZZK platform in beta mode, which is expected to launch globally in May.
After Twitch's announcement, the number of viewing hours on AfreecaTV decreased from 105 million in January to 98 million in February-March.
Meanwhile, CHZZK is actively getting traction. In January, the platform had 25 million viewing hours, 47 million in February, and 59 million in March. It seems that a significant portion of streamers and audience migrated to Naver's new solution.
This is confirmed by data on the number of active channels. AfreecaTV experienced a decline from January (from 35k to 34k in January). Meanwhile, CHZZK grew from 5k active channels in January 2024 to 42k in March 2024.
In terms of average viewership, AfreecaTV continues to lead, but there is a trend of decline. CHZZK shows rapid growth - from 45k in January to 85k in March 2024.
League of Legends, StarCraft: Remastered, and PUBG were the most popular games on AfreecaTV. Black Desert Online, Like a Dragon: Infinite Wealth, and PUBG were on CHZZK. League of Legends, Palworld, and Minecraft were on Twitch, which is in its last months in the country.