The idea of an app arcade has for long had gamers and game publishers salivating over the possibilities. While gamers come in different breeds, they all have a large thirst for experimentation. It’s why games packaged for “free” (like Mario Bros that came with the old Nintendo systems or Solitaire or Minesweeper that came with Windows) typically find mass appeal. If a game looks interesting enough, it will be played. And if people like it, they’ll keep playing.
This is why early 2019 was a time of great expectations for gamers. Both Google and Apple announced all-you-can-eat gaming services that would spare gamers of interruptions from ads and eliminate in-game purchases that enhance game play. These gaming services were seen as revolutionary - a one stop shop to find curated games of all genres for gamers to explore, try and ultimately play. Publishers, meanwhile, could offload some of the burden of finding new users and monetizing their games to the tech giants.
Unfortunately, both services have had shaky starts. Less than two years after these announcements, Google said it was disbanding its Stadia Games and Entertainment team, and last summer we heard reports that Apple was canceling contracts with game makers, leading some to speculate that Apple was rethinking its Arcade strategy.
It’s hard to deny the obvious appeal of a game arcade, but there were questions about the business model. With Internet, cable, and streaming services subscriptions to pay each month, would consumers add yet another bill to their budget? And would game developers be willing to relinquish control of their audiences to Google and Apple in order to participate in these services?
An arcade alternative
While these arcades still may have long term value, another model has emerged: on-device game arcades. With this model, mobile OEMs and carriers work with game developers to select a range of titles that their customers are likely to want and play, and preload them onto devices. The games, which range from casual games to multiplayer role playing, are organized into game folders accessible from the home screen.
The ease of this model has been shown to benefit game publishers, who preload more apps than any other category by a significant margin, and gamers, who prefer finding games through preloads than any other paid marketing method. Much like Mario Brothers and Minesweeper, removing the friction between the game and game players helps in trial and, ultimately, consistent players. When people first buy a device seeing a “games folder” will undoubtedly be irresistible to explore for casual and avid gamers alike. Data shows that activation rates are extremely high for games (and apps in general) that are immediately accessible to users.
But it doesn’t stop at activation; engagement and re-engagement rates are also good with 37% of all preloads leading to ongoing players. This isn’t a surprise given that players are reminded of the game each time they pick up their devices and look at their home screens (about 166 times per day for 66% of the population). Depending on the OEM or carrier, the app developer can send alerts to the users to re-engage them, offering, perhaps, free coins to enhance gameplay as a re-engagement campaign.
Oh, those UA hurdles
It’s hard to talk about activation and engagement without recognizing the brutality of UA campaigns. Even if Google Stadia and Apple Arcade were widely successful, those services would only offer a fraction of the world’s games and apps, so UA investments would be inevitable.
UA campaigns are costly and fraught with friction. App developers spend a lot of time and resources enticing users to click on their ads and view their apps in the app stores, but a click is no guarantee that an active user will be the result of that ad spend. The app stores are full of obstacles in the form of bad reviews, competitive apps and a whole lot of distractions. App-install abandonment is a real challenge, with rates that can top 80% for some app developers. Apps that are preloaded into an on-device arcade don’t face this hurdle.
Inherently privacy compliant
Finally, preloaded app arcades are inherently privacy compliant, which is no small consideration now that Apple’s App Tracking Transparency feature is live, and Google announced that it will not support any identifier for tracking purposes in any of its products. Meanwhile, new privacy legislation continues to wind through committees in state houses all over the country. Launching UA campaigns was already difficult, executing campaigns that meet every privacy regulation is exponentially more complex.
Privacy is one of the areas in which I think app arcades truly shine. You can’t get more private than preloading an app onto a device that isn’t even owned by a consumer yet.
The future of on-device app arcades
While preloaded arcades are a reality now, I can imagine a future where the functionality expands, with wizards that enable users to select which games and apps are loaded to their folders during the device activation process, and where hot new titles are added to a user’s game or app folders automatically. In reality, the sky's the limit. Apple and Google rather heroically tried to change the app paradigm with their Arcade and Stadia services. Those services might not have panned out the way they’d hoped, but the concept of an arcade is a good one, and has legs. You may very well see such an arcade the next time you purchase a new phone.
