Four women cosplay the characters in the popular game King of Glory in Jinan, Shandong province. (Photo by Yi Sheng/For China Daily)
In Asia, where the percentage of paying players is lower than anywhere else in the world, average in-app-spending is $20 per month. That is double the global average, according to a study by Israeli mobile app analytics company Appsflyer.
According to a video produced by Vox news, entitled How Free Games Are Designed To Make Money, in-app-spending titles use exchange rates that will confuse any average player.
"You're spending money that doesn't seem real and it only takes a second because the app store already has your credit card," Joss Fong, senior editorial producer at Vox, commentates in the video.
"The whole payment process is designed to be painless," she adds. "Other parts of the game, however, are designed to be painful."
But there are other ways for mobile game companies to make money. IronSource helps advertisers and game firms profit from players who simply do not make in-app purchases by running pop-up advertisements with in-game prizes.
Advertisers, for example Airbnb, can increase traffic to their sites, while gamers receive rewards by watching a 15 to 30 second video, according to Aviv of ironSource. These ads may also allow users to play the first level of a game, such as Candy Crush Saga, getting them interested in the title before supplying a link to download it.
"People are coming back to the game because they're able to progress more," Aviv said. "They don't feel like, 'If I don't pay, I can't play this game'."
As a result of China's growing status in the mobile gaming industry, foreign companies are keen to crack it, even though it is the most difficult market to enter, according to Wehmeier of Atomico.
"Companies that ultimately go on to have success … what they have understood is that while content is critical, distribution is king," Wehmeier said.
Game developer and Farmville creator Zynga showed that, without a local partner, foreign companies struggle to compete in China. With its US operations also hitting financial lows, Zynga decided to close its Beijing office in 2015, cutting 71 jobs.
But the California-based firm could be on track for a turnaround as it partners with Tencent's rival, NetEase Inc, to bring the mobile strategy game Dawn of Titans to China later this year.
Zynga declined to comment on its motivation to introduce the game to an overseas market.
But it stated in May that the company is "excited to see how local action strategy fans make it (Dawn of Titans) their own".
There is a strong appetite for international content, according to Wehmeier of Atomico.
In 2015, Tencent bought Silicon Valley-based gaming company Riot Games, producers of League of Legends, which had 100 million monthly players last year, according to a Forbes report.
Riot Games, now a branch of Tencent, declined to comment on the game's success in China.
Blizzard Entertainment's battle cards game Hearthstone, which originated in California, has also gripped Chinese players, with its competitive championship having just wrapped up in Shanghai.
"It's possible today to build game companies worth tens of billions, if not a hundred billion (dollars)," Wehmeier said. "If you have the ambition to get to that scale, if you truly want to become a global giant that's on par with some of these Chinese players, you simply can't afford to ignore the Chinese market."
