Japanese gaming benchmarks: What happened in the first half of 2017
James Haslam, Senior Content Manager, Adjust, Oct 5, 2017.
With Tokyo Game Show just finished, we wanted to celebrate the Japanese app gaming market in our own way, bringing some of the insights we gathered from the convention to you. To do so, we asked ourselves one question: what makes Japanese gamers tick? We dived into the data, and now we have a new set of benchmarks that give you a little insight into the market.
In this article you’ll find out more about Japanese app gamers, from retention rates to engagement, and we’ll take a special look at levels completed per platform. Our benchmarks cover iOS and Android, and we compare between paid and organic acquisitions.
All data represented below was taken from an anonymized sample of Japanese gaming apps that use Adjust, gathered over the first half of 2017 (or H1). This data is split by operating system (Android and iOS), and by acquisition channel (paid and organic). ‘Paid’ refers to those who installed an app through an advertising campaign, whereas ‘organic’ installed apps not attributed to a specific source.
An overview of the market
To provide some context for the Japanese marketplace, we turned to eMarketer to learn more. By the end of 2017, it’s estimated that there will be 58.9 million smartphone users in Japan, out of a total projected population of 127,484,450. Mobile ownership is anticipated to grow, with over 50 percent of Japan’s population expected to own a smartphone by early 2020. Smartphone growth has been viewed as slow in Japan (at least compared to neighboring China), owing to users avoiding picking up new tech over old, flip-style phones.
Adults in Japan typically spend (on average) 106 minutes of their day on their smartphone, most likely throughout the workday and during the commute to and from work. While TV is still the dominant format in terms of time spent, for both viewers and campaign dollars, looking at eMarketer’s analysis of media ad spend in the region, mobile makes up a significant portion of overall digital spend: 56 percent of $11.79bn to be exact. Compared to last year, digital spend has increased almost 10 percent, the only channel to grown over two percent since 2016.
We’ve talked a lot about retention rates, a key metric that we often compare in our mobile benchmarks. Retention rates give marketers a better understanding of how an app performs over time, as they’re measured by whether a user triggers an app session at least once a day. The rate lowers when a user doesn’t return - when a drop-off occurs, it’s understood that a user is no longer interested in returning to the app.
In the graph below you’ll see retention rates per day over thirty days. Each significant period (days 1, 7, 21, 28) are highlighted, with figures added to avoid data saturation. What we’re looking at here is the comparison between them, not so much day-to-day numbers.
When it comes to performance, we usually expect organic users to stay longer than their paid counterparts, usually with large drop-offs between days one to seven.
Android results are fairly typical: Japanese gamers who install apps organically stay around a little longer than paid users - over 41 percent on day one compared to just under 39 percent.
On iOS, our assumption was wrong. Here, gamers from paid campaigns retained in larger numbers than from organic installations:
On day one, retention rates for paid users were three percent above those of organic users. Paid user retention remains above organic until day 22. This is quite a surprise, so we spoke to Micheal Paxman, our AM Team Lead in Japan, to find out more about why this might be.
“Japanese games run a lot of "collaborations" with other popular IPs (like when Puzzle & Dragons did their collaboration with Hello Kitty). These campaigns often bring lapsed users back to the game, which keeps retention relatively high. Remember, the Japanese gaming market is very dense (with a huge number of very similar titles, per very niche genre). As such, the most popular games benefit each other by merging features or featuring characters in different worlds.”
“Cross-app promotion then becomes a mobile marketers most effective tool. This goes beyond retargeting (companies here don't usually run retargeting campaigns). Though we think that those engaged in some form of advertising that brought them to the app will also be more likely to engage in cross-promotion too.”
“We strongly assume that (on iOS) people who came to an app via ads from a similar app are more likely to retain through a week than organics, some of whom would just be ‘giving it a go’, thanks to clever cross-promotion.”
Sessions refers to the period of time in which a user interacts with an app. The metric gives an insight into true user interaction, as it looks at the number of times a user jumps into an app (a new session is tracked outside of a window of thirty minutes).
In our study, session behavior varies wildly, and we’ve highlighted some of the outliers below (the numbers themselves are too large to represent, so the graphs include an overview of apps by category, such as Music, Puzzles, and Arcade games.) We’ve highlighted the best performing apps in our graph.
While music-based gaming apps (such as rhythm games) engage with users the most, when it comes to paid acquisition, Sports, Racing and Puzzle games all show a highly engaged Android audience in Japan.
On iOS, there’s no single organic app that stands out. However, Roleplaying and Puzzle apps have a highly engaged user base from paid user acquisition, and Simulation apps are the dominant force when it comes to sessions on Apple devices.
Michael had this to say: "I think it's straight up game content here. RPGs, Simulations and Puzzle games in particular reward players for playing every day, and for playing a lot (until their stamina runs out)."
"Also, one important point: the Japanese average for commuting to work is 45 minutes, and these genres are very popular for salarymen, who are often viewed as the most valuable demographic. So that’s about two sessions per user, for most of the days of the week."
Looking beyond our traditional benchmarking metrics, we compared level event completions. We wanted to find out more about in-game engagement by OS and acquisition channel, and (as you’ll see below) there are some interesting trends to investigate.
The chart samples users over a thirty day period, and aggregates the number of ‘level event’ completions. Organic iOS users completed the most amount of levels per day, while paid Android users played the least, at least until day 29. Organic users in general play the most, with steady drop-off over time.
It could be said that paid Android users are the most consistent gamers - completing a little over three levels every single day. This could be for a few reasons. Directly comparing the two paid channels, it could be a case that Android users are consistently re-engaged, while iOS users are highly engaged at the start of a campaign, but not towards the end.
Coming away with these benchmarks might result in wanting to review current spend per platform, and consider that retargeting might be a worthwhile investment on iOS in Japan, even if it goes against market trends. This is particularly backed up by the performance in three different genres, on iOS - Puzzle, Sim and Role Playing games.
Rewarding players for returning and targeting recently lapsed users with incentivized ads may be two of the most powerful strategies for marketers playing a long-term, LTV-focused campaign.
Though a unique market (with a perhaps over-saturated player base), there’s still room for growth, and for games to come in and out of fashion. Japan presents an exciting opportunity for businesses both inside and outside the region, and we’ll be keeping an eye on the market with future articles just like this one.