Are mobile games profitable?

Are mobile games profitable? Mobile games can make a lot of money because developers have different ways to earn from them. Or they may not earn anything. The amount of money a mobile game makes depends on how popular it is, the marketing methods used, and how much it costs to create and keep the game running. Can popular smartphone games have made a lot of money for their creators. How did they do that?

The Mobile Gaming Market

The Mobile Gaming Market is projected to increase in size, rising from $91.08 billion in 2023 to $149.30 billion by 2028. This growth will probably occur at a compound annual growth rate (CAGR) of 10.39% between 2024 and 2028.

This market is growing fast, thanks to lots of people using smartphones. Smartphones are easy to play games on, so even people who don’t have special gaming devices enjoy them. App stores like Google Play and Apple App Store make it simple for game makers to share and make money from their games because there are so many users.

The Mobile Gaming Market size Infographics Top Grossing Mobile Games Worldwide

Changes in mobile game development have led to more spending on ads to attract users. To save on costs, early click-through rate (CTR) tests are useful, especially in casual mobile games. 

More and more people are getting mobile phones, and this means an increase in the growth and popularity of online mobile games. So, there are new opportunities for game makers. Faster 5G internet and unlimited data plans are making it easier for people to play games on their phones. This is especially important in the Asia Pacific region, where they’re investing in this technology to support gaming growth.

The worldwide Mobile Games Market is driven by some major players who have made a significant impact in the industry. These leading manufacturers in the market include Tencent, Niantic, Big Fish Games, Activision Blizzard, Supercell, TakeTwo Interactive, Ubisoft, Gameloft, Nintendo, Electronic Arts, Zynga, and Machine Zone.

Cute goat character engaging with mobile game surrounded by monetization icons Factors influencing mobile game and advertising industry

Factors Influencing Mobile Game Profitability

Many factors impact how much money mobile games make. We will explore these factors to help understand what drives the profitability of mobile games.

Game genre

Popular genres

In 2023, the most popular categories in the market were:

Action and Adventure

Arcade

Role-playing

Sports

These categories show the diverse preferences of gamers, offering a wide range of gaming experiences for everyone to enjoy.

Niche genres

  • RTS or Strategy (RTS): these games are all about quick thinking, where you control armies, resources, and territory in real-time. They’re popular on mobile because they offer engaging challenges.
  • Survivals: surviving tough conditions and gathering resources. Mobile players like them because they offer exciting experiences in short bursts.
  • Match-3 + Meta (Metaelements): matching items in sets of three or more with a twist. These are favored on mobile because they offer quick, fun puzzles and often include innovative gameplay elements.
  • City Builders: build and manage your own city or civilization. Mobile players enjoy them for their strategic and creative aspects.
  • Tower Defense: defend against waves of enemies with strategic tower placement. Mobile users like these games for their simplicity and strategic challenges.
  • Platformers: run, jump, and solve puzzles in 2D or 3D environments. They are popular because they provide quick and fun challenges.
  • RPG (Role-Playing Game): step into the shoes of a character in a story-rich world. Mobile RPGs are a hit for their stories and character development that can be enjoyed in short sessions.
Mobile game profitability concept with character on phone screen and strategy icons Game monetization models

Monetization strategies

Mobile games can make a lot of money because developers have different ways to earn from them. Some common methods include:

  • In-App Purchases: this means selling things like extra game levels, special items, or characters inside the game. If you’re new to game development, consider other monetization options besides in-app purchases for paid games. You can make your app free and earn money through in-app ads. According to AppAnnie’s study, players spent a total of $156.5 billion in app stores in 2022. Price items strategically, offering both expensive and cheaper options. Time-limited offers are popular and work well. 
  • Subscriptions: players pay a monthly or yearly fee to get access to exclusive content or features in the game. There are individual subscriptions for specific games and umbrella subscriptions for multiple games. The most popular is the “Battle Pass.” Users buy it to unlock new content and rewards during a set time frame, like 15-30 days. 
  • Advertising: games can show ads while you play or offer to watch ads in exchange for in-game rewards. Users get rewards for watching ad videos, and it’s one of the top ways to make money with mobile games. According to Ipsos, in-app ads are effective with 47% of users remembering them, and 50% finding them visually pleasing. 
igh-quality gaming concept art with a futuristic sci-fi character and console, How to Optimize the Ad Monetization Strategy of Your Mobile Game

Game quality

  • Graphics: good graphics make a game look cool and appealing. Most profitable game studios use unique art and graphics to make their games stand out and create a brand players recognize. This is especially important in mobile gaming, where many similar games compete. Today, storytelling is just as important as gameplay. For example, games like Pascal’s Wager or Torchlight Infinite use visuals to “show” the plot, making them unforgettable for players.
  • Gameplay: this is what you do in the game. It should not be too hard or too easy. When people play a game, they’re looking for excitement, getting better at it, and getting rewards—all while doing fun and motivating things. This is why gameplay is super important in game design.
  • User Experience: user experience, or UX, refers to how players interact with your game. UX means making sure players can easily grasp and use the tools they need to conquer challenges. Everything should be clear, and you should be able to control the game without any problems.

Monetization Models

Can you make money from mobile games? As the gaming market has expanded, there are more ways to make money from games. In the past, you sold physical copies or hoped people bought them. Now, you can publish your game online. So, how do you make money without annoying players? Do you charge for downloads, use a monthly subscription, or offer your app for free with ads to make money?

Smartphone showcasing different monetization models for mobile games, how to monetize games

Free-to-play (f2p)

The Free-to-Play model with in-app purchases is a popular way of making money with mobile games. Players can download games for free and buy in-game items or features if they want. This model expands your player base by removing initial costs. Also, it increases player engagement and recurring gaming sessions. But the free-to-play model needs careful balance to prevent the game from feeling “pay-to-win” and requires regular content updates to maintain player interest.

InMobi reports that mobile users are more inclined to click on ads within a mobile app rather than on a mobile website. In-app ads, which accounted for 80% of impressions, achieved an average click-through rate (CTR) about 2.8 times higher than mobile web ads.

Pay-to-play (p2p)

The pay-to-play (P2P) model is the oldest way to make money in gaming, going back to arcade machines and the first home consoles. It’s simple: you pay once, and you get full access to the game. This model is still used today in various forms. Some game developers sell part of the game upfront and offer the rest as downloadable content, season passes, or loot boxes that players can buy as they choose.

Freemium

The freemium model in mobile games allows users to install and play the game for free. But if they want premium game features, they need to make in-app purchases, often called microtransactions or in-game purchases. So, users pay for special features that aren’t otherwise available for free.

Fantasy alien character surrounded by app optimization icons for ASO Soft Launch services game monetization strategy

Mobile Game Art Costs

Creating art for mobile games can vary in cost, depending on factors like style, complexity, and team size. The chosen art style has an impact on costs. Simple 2D graphics will generally be more affordable than complex 3D models. Highly detailed assets take more time to create and, therefore, cost more. The more characters, objects, and backgrounds your game requires, the higher the cost. Be mindful of asset quantity.

Art Style and Complexity

Mobile game art styles can vary in complexity, and the choice of style plays a crucial role in the game’s overall design. 

  • Simplicity: some mobile games opt for straightforward and minimalist art styles, which can increase mobile gaming revenue if used right. These styles are often 2D and characterized by simple shapes, limited colors, and clean lines. The advantage of simplicity is that it’s easy for players to understand and engage with the game. It’s also cost-effective for developers, making it a popular choice for casual and hyper-casual games.
  • Pixel Art: while it might seem simple due to its blocky appearance, creating effective pixel art can be quite complex. Artists must carefully select colors and create detailed characters and environments within the limitations of pixel resolution.
  • Cartoon and Anime: they are often seen in casual and family-oriented games and can vary in complexity from simple and child-friendly to more detailed and intricate designs.
  • Realism: realistic art styles aim to mimic the real world as closely as possible. Achieving this level of complexity can be demanding, with a focus on accurate proportions, textures, and lighting. Realism is often used in simulation and high-end mobile games that require detailed visuals.
  • Mixed Media: some games combine various art styles and elements to create unique and visually appealing experiences. These mixed media games might use 2D characters in a 3D world or blend pixel art with modern design.
Cute frog character as an artist with a palette mobile game art costs how to make money with mobile games

2D vs 3D Art

2D Game Art lacks physical depth, offering only two axes of motion. While you can simulate a 3D appearance, it fundamentally remains a 2D form. This simplicity arises from the limited range of character movement, typically restricted to right-left and up-down directions.

In contrast, 3D game art demands more time and effort than 2D. This is because 3D objects and characters possess three-dimensional attributes, including depth, height, and width. Creating a 3D model isn’t a direct imaginative process; it begins with a 2D sketch, which serves as a foundation for constructing the 3D model. If you want simplicity and minimalism, choose 2D art for your game. But if you need a detailed and realistic design, consider choosing 3D art.

3D digital art of a robot and fairy, 2D vs. 3D mobile game art styles, different mobile game monetization strategies

Successful Mobile Games Examples

Whether you’re immersing yourself in the expansive world of Genshin Impact or simply enjoying a quick match in Call of Duty: Mobile, the mobile gaming landscape offers a lot of games to explore. The most profitable mobile games in 2023 are:

Pokemon Go

Call of Duty: Mobile

EA Sports FC Mobile

Clash Royale

League of Legends: Wild Rift

Profitable indie games examples

Indie games are special because they come up with unique ideas for how games work and tell stories. Often, a small team of people creates these games, and they work hard, even without pay, to make their dreams come true. Here are some most profitable games that became big hits and have cool stories behind them:

  • Cult of the Lamb: this game blends city management with roguelike elements, where players manage a cult and battle bosses. Its unique art style combines cute and satanic imagery, making it visually striking.
  • Hollow Knight: Hollow Knight’s success is a result of the team’s dedication and strong community engagement. The game is a Metroidvania offering customization and multiple exploration paths, ensuring each player’s journey is unique.
  • The Binding of Isaac: this roguelike game draws inspiration from the original The Legend of Zelda games with a top-down view. Players start from the beginning upon death, providing a challenging experience.
  • Among Us: released in 2018, Among Us did not see its massive success until 2020. Developed by a team of three, the game was initially on the brink of abandonment. Growing player demand for content kept the team working on the game, and it eventually exploded in popularity.
Animated mobile game character bursting out of the smartphone screen, Indie Games That Became Major Success Stories

Challenges and Risks

The gaming industry is fiercely competitive and overcrowded, with thousands of new titles hitting the market annually. Developing mobile games is a complex task. Creating games that work on multiple platforms can expand your reach to a larger audience. Hiring the right company can save you time, money, and future concerns. Understanding the market and customer needs is crucial for success. 

Technology is always changing, and even unique products can become outdated. This is a major challenge for game developers. It’s unrealistic to expect your game’s value and demand to stay the same. As a result, the lifespan of games in the market is shrinking.

One common mistake made by game developers is starting game development without a clear plan for monetization. Before coding, consider how you’ll make money from your game. Will it be through ads, in-game purchases, or a premium price? While having a monetization strategy is essential, timing is crucial. Premature monetization efforts can alienate players.

Instead of bombarding users with ads or purchases from the start, focus on creating an enjoyable gaming experience. Understand your users, their preferences, and demographics to curate a successful monetization strategy. Build a loyal audience first, and introduce monetization gradually as players become more engaged. This is how you can create the most profitable mobile game.

FAQ

Are mobile games profitable and what are the most profitable mobile game genres?

What are the most profitable mobile game genres?

  • Hyper-Casual Games: these simple, easy-to-pick-up games often feature ad-based monetization and have proven to be highly profitable.
  • RPG (Role-Playing Games): engaging storytelling and in-app purchases can make RPGs lucrative.
  • Strategy and Simulation Games: games that involve resource management and strategy often do well in terms of revenue.
  • Match-3 Puzzle Games: these games, with in-app purchases and ads, have a solid track record of profitability.
  • Multiplayer Online Battle Arena (MOBA): MOBA games with in-app purchases and cosmetic items can be profitable.
  • Gacha and Collectible Card Games: these games rely on the “gacha” mechanic and collectible cards to encourage spending.

How much does it cost to develop mobile game art?

The cost of developing game art can vary widely depending on factors such as the complexity of the game, the style of art, the experience of the artist, and the number of assets required. On average, you can expect to pay anywhere from a few thousand dollars for a simple 2D game with basic art to hundreds of thousands or more for a high-quality 3D game with intricate and detailed artwork. It’s crucial to work with a professional artist or studio and to budget for concept art, character design, environment design, animations, and user interface elements.

Can indie developers make profitable mobile games?

Yes, indie developers can indeed create profitable mobile games. While the mobile game market is highly competitive, indie developers have several advantages, including creative freedom and the ability to cater to niche audiences. To increase the chances of profitability, indie developers should focus on creating high-quality, engaging games, use effective marketing strategies, and choose monetization models that suit their target audience. Building a strong community and leveraging platforms like app stores and social media can also help indie developers succeed in the mobile game industry. Success may take time, dedication, and adaptability, but it is achievable.