This post is sponsored by AppMagic

I (Joakim) wrote an article with the AppMagic folks, and in it, we talk about the ways that developers of mobile games should think about market insights in the early stages of concepting and prototyping of their games. Check it out here.

Written by Joakim Achren (Elite Game Developers), Max Samorukov (AppMagic) and Diana Levintova (AppMagic

We often hear this question coming up: “how should I evaluate the viability of a game idea as I’m starting to work on one?” It’s an essential question since you don’t want to end up spending several months developing something that won’t work. And the worst thing about building a game without any early validation is that you often don’t understand why it’s not working when the game is ready. Many developers are clueless about the bad performance of their game, you see Day-1 at 20%, and you just shrug your shoulders and move on to the next game.

Here’s another story. Each month, an average of 10,000 new games appear in the mobile stores and they get ranked at least once, even in the least remarkable category; in at least one country; for at least one day. All these apps get some speck of limelight as they make the radar—gaining a few thousand downloads, earning a few hundred dollars. 

These games are often quite polished and produced well, with great gameplay, art, and other content. The devs worked hard, had appropriate skills, and were passionate about their idea. But the fact is that only a few percent of these games will ever earn more than $100k over their lifetime. The rest, an overwhelming majority of mobile games, was based on a cherished game idea that didn’t work out.

How do you move your game from where most games go to die to get into the group of games that will earn more than $100k over their lifetime?

Evaluating a game idea: look for similar products

Game developers love to make games that they enjoy playing. That’s why we’ve been seeing so many Archero clones and Brawl Stars clones, from small and big developers, across the board. Building a derivative product is fine, and you can make a $100k lifetime game with this approach.

But before getting elbows deep into development, even when you believe that your game is unique, it is worth checking if anyone has already had a similar idea. And, if there are similar games, you want to understand what their developers have done to achieve success.

To find similar apps, you can use the following approach: Search the App Store for keywords representing your idea. For example, Archero brings up some valuable results. However, this method will not work for all the games: its efficiency depends on how the particular store ranks its search results and the competition for the used keyword. 

To make things even easier, I’d suggest using some of the tools out there where you can search by subgenre. You’ll find this option provided by AppAnnie (but it is paid and very expensive), GameIntel (for free, you can see the top 5 apps by subgenre based on the top free app in the USA), and AppMagic (free, no limitations).

After researching and making an extensive list of the most relevant titles from your target subgenre, you can evaluate how unique your idea is. You’d want to look at game design, monetization, art, and UI. What kind of player motivators, player goals, features, and other solutions appear to be linked with success. Assess whether or not you can create a product that can be, with enough conviction, put in line with the most successful references found.

It is essential to keep in mind that searching for reference apps only in the charts’ top ranks may result in survivorship bias. That is why it is crucial to pay attention to the less successful apps just as well. Digging deeper into the stores is how you discover millions of inglorious innovations that didn’t turn out well. Each sub-genre usually has a lot of “dead bodies on the ground.”

Note: This type of analysis won’t help you find guaranteed ideas for a successful game, but it can help avoid costly mistakes by leveraging what other developers have done.

Developing variations on successful games

Whatever your approach, it’s essential to analyze others’ mistakes before embarking on your development journey. 

Let’s continue with the idea of building your variation on Archero for now.

View full size image by going here.

I (Joakim) was recently shown a demo of AppMagic, and the utility of the tool will help all mobile developers, small and big studios included. Visualizations of the type above are available in AppMagic are a handy way of comparing multiple apps’ revenues in one graph. 

It is important to remember that only revenue from payments, subscriptions, and paid installations determine a game’s position in top-grossing charts. Advertising revenue cannot be detected, and there is no analytical service that can provide you with decently accurate estimates of advertising revenues for mobile applications. However, some insight into advertising revenues can be gleaned from analyzing how app downloads are distributed across countries. This data is available for free from AppMagic.

Advertising-based LTV from countries like India and Vietnam, if the monetization is configured properly, is $0.01-$0.05 (depending on retention, audience, and game monetization); for Russia and Brazil, it is 3 to 5 times higher. Advertising revenue from the wealthiest countries can reach $1-2 per user. 

In other words, if you see a game with a high number of downloads, be sure to identify the key countries where the bulk of the traffic comes from. If most of the installs arrive from countries with low GDP per capita, such as India, Cambodia, or Brazil, then one should not count on high ad revenue: from a million downloads in India, you may earn just $10-20K tops.

Am I targeting a dying market segment?

If we look at how revenue shares of different mobile game genres have been changing in the largest Western countries, the first thing we notice is a sharp decrease in the red area that stands for RTS games.

See chart variation by going here.

In mobile games, there are no traditional RTS titles as we know them from PCs; in the mobile context, an RTS is usually a PVP game with asynchronous battles and elements of town defending, such as Clash of Clans.

The question is, why have games of this genre been losing their market share so fast? Are there maybe no newcomers in this genre? But there are! Are they of poor quality? No way, there’s even a Star Wars game with building and battling. So what is going on? 

When something (a game or a genre) is not growing or shrinking, the reason is always the same: developers cannot buy enough traffic to grow with a positive ROAS (return on ad spend). In the case of a genre, it means that games of other genres with a similar audience can pay considerably more for an install, which results in them claiming the traffic.

Because of the competitive nature of mobile game development, combined with the leverage of knowledge concentration and better tooling enabling higher scaling of user acquisition, the cost of one install is increasing. Thus, a game (or genre) with a higher LTV (player Lifetime Value) compared to its competitors will not claim all of the traffic, but the balance will shift: the one who is ready to pay more per install will get more traffic. The flip side is that even games with low LTVs can still purchase some users; however, the volume is often so low that it doesn’t justify the costs of maintaining the game and the marketing team.

Seeing the rate at which the share of RTS games has been falling, it is clear that this genre is currently losing its battle for traffic on mobile. And that means it is extremely dangerous to start developing a game in this genre.

One thing to add is that revivals and innovations, i.e. new mechanics applied to tried and tested games, happen in many genres from time to time, unlocking opportunities for whole new generations of games. That is why it is important to keep track of successful new products in different genres if you don’t want to miss a window of opportunity.

How can you track successful new arrivals? For this purpose, some companies provide special tools for tracking recently released and fast-growing apps, including GameIntel (you can see 5 apps of the subgenre for free in the top free apps chart in the USA) and AppMagic (free, no limitations).

I will build the game, and the players will show up 

Erm, no. That’s not how mobile gaming works. There is almost no free traffic in the stores. And what’s available will not provide you with an opportunity to earn money. Yes, there are a couple of exceptions: one being featured on a non-contractual basis and the other—using referral traffic from stores. But you cannot factor them in as a key factor to reach players and gain installs.

Yes, there are examples of games in stores that have become super-viral and got stuck firmly in top charts while, at the same time, never buying traffic (or buying very little of it). However, these stories, for the most part, dating back to times when there were still many empty niches in the market—for example, corresponding to traditional games (card, sports, board). We can also recall gaming “unicorns” such as Minecraft and Roblox, but do bear in mind: these are rare exceptions from the general rule. 

What do you do if you are not yet familiar with how user acquisition works? In any case, before starting your development, make sure that the genre or subgenre of your choice is growing or is at least stable, and that its leaders change from time to time, making way for new titles.