Online gaming is a booming and fast growing sector, with revenues expected to reach nearly $137.9 billion in 2018. Germany tops the gaming revenue ranks in Western Europe, with a forecast of $4.7 billion, but our research also found that German players are actually the hardest to convert when compared to their gaming peers in other countries – with the lowest player/payer ratio (70%) and spending levels 20 percent lower (on average) per player than in the US and the UK.
Clearly, there is opportunity here for game publishers – but how can they entice more German players to part with their money in a sustained way? The first step is to understand their payment preferences and where the payments experience can be improved.
What do German players play on – and what do they pay for?
Looking at the devices that gamers are using, German gamers diverge from US and UK players; 60 percent use Android devices to play mobile games, compared to less than half of US and UK gamers. They are also much more likely to be using a PC for gaming (66% compared to 55% in the US and 49% in the UK) and are less likely to be using a console (75% of gamers compared with 85% in both US and UK).
More German men spend money on DLC/expansion packs than any other player group across the three countries we surveyed (50 percent men vs 21 percent women). This is the biggest gender split we found in our research, with only 29 percent of female German players spending in this category. German players (both men and women) are also most likely to spend on playable characters and least likely to pay for time-savers, compared to US and UK players.
Across the board, we found that 40 percent of non-paying gamers said they wouldn’t spend on a certain game is because they are satisfied with the free gaming experience. This trend is very much driven by Germany, where half of non-paying players do not spend for this reason.
How do German gamers prefer to pay?
Our research also revealed that German gamers are most interested in a smooth payments experience, and purposefully select the payment methods they believe offer the most seamless process. We found that this motivation for payment method selection is more important for gamers in Germany than in the other countries surveyed.
There is also a definite generation split in payment preferences. 73 percent of 30-40-year-old gamers in Germany who are aware of paying by invoice have a positive attitude toward it, with just 62 percent in the younger age group (18-29) – a statistic that is perhaps unsurprising given the traditional popularity of this payment method (before there were so many other options on offer).
Germany is also the only country where younger gamers demonstrate a more positive attitude towards selected alternative payment methods, including PayPal and Google Pay, with younger paying gamers more likely to use PayPal when spending money on games across all devices, compared to older payers.
The ups and downs of the German gaming payments experience
German gamers are the least likely to have had a negative payment experience online and to have experienced fraud, most likely due to their slower uptake of digital payment methods compared to the other countries. In the instances where German gamers did record a negative experience, it was often centered around confusing processes.
Interestingly, older gamers in Germany seem less concerned with security; they are more likely to want to skip security measures after completing them once, and to register their details in advance of a purchase. They also feel more strongly that extra security measures are likely to prevent them from completing in-game purchases or making future ones.
These preferences regarding the payments experience reinforce German gamers’ overwhelming desire for a seamless and fuss-free payments process that doesn’t interrupt or distract from their gaming time. This is certainly an area that game publishers need to pay most attention to if they want to secure a bigger slice of the revenue opportunity on offer in the German gaming market.
Attending MRC Malta 2018? Alejandro Aznar will lead the breakout session: “Understanding The Payments Experience in Gaming: Effects of Digitalization, Cross-Platform Gameplay, Alternative Payments and Fraud” – Wednesday, September 26, 10:30–11:20am.