Bet on global markets reaping benefits for Indian gaming cos

Plug-and-play gaming solutions firm Gamezop has seen its revenue from outside India double in the past one year to 50% of the company’s total revenue. In the past financial year, Gamezop generated ₹25 crore in revenue at 25% profit margins and expects this revenue to double in this financial year.

Online gaming company Mobile Premier League (MPL) expects the US to become its second-biggest market in terms of revenue by the end of the year if the current pace continues. The company has established a presence as a competitive skill gaming platform in the US over the past three months, said Naman Jhawar, senior vice-president, strategy and operations at MPL. “After India, the most important market for us is the US. We have seen a lot of companies in the US adopt our gaming solution. Brazil is the second-largest followed by Indonesia. We saw most of the uptake happen in the last 6 to 8 months,” said Gaurav Agarwal, co-founder Gamezop.

Popular mobile gaming platform Hitwicket has also seen its revenue soar in global markets.

About 38% of the company’s revenues from in-app purchases (IAPs) have come from global markets in the past year, said Keerti Singh, co-founder and vice-president of growth at Hitwicket. As much as 50% of their overall revenues could come from those markets in the next two years, Singh said.

The Indian market is great for acquiring new users, but the revenue per user an app can draw is much higher in global markets, industry experts explained. “There is no surprise in this. Their revenue models are essentially around views, impressions and clicks. When this happens in the US market, they get a better rate per impression compared to India or other Asian markets,” said Faisal Kawoosa, founder and chief analyst at techARC.

Global markets do not differ from India in terms of how much people spend on apps, Singh said. The difference is in the conversion rate, the metric for how easy it is to convert free users to paid ones.

Indian users are tougher to convert, while global users are more likely to pay. Conversion rates have grown for India since 2018, but global markets remain ahead, she said.

Unlike MPL and Hitwicket, Gamezop faced a different challenge. Their business model is business-to-business and so they had to reach out to app and website developers and convince them of the merits of having a gaming section within their products.