As the hyper-casual games market matures, competition is increasing to the point where entering and surviving is becoming more difficult. In 2018, even though hyper-casual downloads and revenues rose quarter on quarter, the percentage of growth QoQ sharply decreased for both. 

As such, some publishers no longer remain confident in the sustainability of the existing monetization model, in-app advertising, and are moving towards hybrid monetization systems.

One such company is Ready Games, who are merging hyper-casual gaming with eSports, focusing on subscriptions and brand advertising over ads for its primary revenue stream. ironSource caught up with its founder, David Bennahum, to discuss this novel concept and its potential impact on the market. 

Flipping eSports on its head

Released in May 2018, Ready Games is a free app that publishes three new hyper-casual games every week, and lets users compete against each other on their mobile devices for real money prizes. Typically, the top 20% of the leaderboard splits a $1000 cash prize, which in the future might include valuable brand products as well. Ready has released 220 games in the last year, making them one of the most prolific hyper-casual publishers out there. 

They’re on a mission to prove competitive gaming is no longer for hardcore players. Whereas traditional eSports has a relatively small selection of elite, professional gamers, with spectators representing the vast majority of the market, Ready seeks to flip this on its head. It wants to make casual gamers - and more specifically, hyper-casual gamers - the majority. As Bennahum explains, “with Ready, there’s now a product for the cohort who would want to compete, but would never go on a console or be die-hard Fortnite players...they are categorically different from the first wave of eSport adopters”.

Hybrid monetization models

In-app purchases and subscriptions 

Six months following its release, Ready Games introduced IAPs in the form of extra lives (four will set you back $5), and in March 2019 they released a monthly subscription for $5 a month, which offers a 50% discount for all IAPs in addition to exclusive features. For Bennahum, the focus has been on converting users into paying customers.

Other publishers like Fun Games for Free have seen success from subscriptions with hyper-casual titles Color By Numbers and Paint by Numbers, while Playgendary improved IAP by 70% in games Kick the Buddy and Tomb of the Mark, according to Deconstructor of Fun. Habby’s hit game Archero, a hot topic in the industry right now, made $35M from IAPs in just a few months. 

A newfound focus on retention is a reaction predicted by Mishka Katkoff at Gamefest 2018. Time will tell how this might impact the ecosystem as a whole, but it could shift how hyper-casual publishers approach user acquisition. Until now, the low retention has actually been a boon for the industry, as the resulting low LTVs have allowed publishers to bid exceptionally competitive CPIs, which in combination with high IPM creatives, has been a winning formula for aggressive UA. By adding meta and other components, we can expect an increase in retention and LTV of users, which could cause CPIs to rise as well. 

Brand sponsorships

In the future, Bennahum says Ready Games will complement its existing revenue streams through brand sponsorships, for example by offering brands the opportunity to provide the prize within a game.

Ready’s eSports component could act as a gateway for brands into hyper-casual games, and even the wider mobile game market. eSports is widely embraced by brands (fashion icon Louis Vuitton even got in on the act), but they’ve traditionally been reluctant to invest serious advertising budgets in mobile games, still stuck on the stereotype that the only people who play games are teenage boys. 

However, this image no longer holds truth, as games today are played by all sorts of diverse audiences. In fact, hyper-casual games span multiple demographics, as the low commitment requirements make them easy for anyone to pick up and play whenever, wherever. Additionally, women make up 55% of the mobile games market today - contradicting the stereotype.

The fusion of hyper-casual games with eSports can diversify and expand revenue streams for publishers, and could even catalyze a rise in brands advertising in mobile gaming as a whole. Ready’s IAP and subscription model proves that advertising is not the only way to monetize from hyper-casual games, provided they have an extra layer such as a competitive or financial reward. Though not all publishers agree that hyper-casual games need to adopt deeper mechanics to survive, Ready Games are giving us an idea of the possibilities that lie ahead. 

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