For people in England doing online stock trading in US stocks, there is a new trend or phenomenon to consider. Tech stocks could be rising on account of the huge success of in-app purchases. The in-app purchases through games can draw quite a significant income for their companies. That’s being illustrated with the recently launched sensation, Pokemon Go.

 

The “Freemium” Concept

 

The sheer potential of Pokemon Go is unbelievable. This mobile content is a "freemium" game, with users downloading the app for free though they can pay a premium for more features and better experience after entering the game. So that probably answers the angst investors may be having as to why provide free content - since users will get so hooked that they would eventually go for the paid upgrades and features.

 

This market is pretty popular and successful already. According to research, in-app purchases were expected to generate $1.82 billion in the US in 2015. Game downloads though were only expected to generate $1.22 billion. The disparity is also seen in the expected revenue growth of in-app purchases and game downloads - in-app purchase revenue growth is expected to be 9.4% in 2016 and game downloads are expected to increase by 8.1%. So in-app purchases are expected to keep growing significantly and consume a larger share of the market for mobile gaming.

 

And Pokemon Go will soon be the most oft quoted example of this. The concept is, getting people hooked to the game by offering it for free and then providing the other game enhancing features for a price. And people really are falling for it. According to Sensor Tower, the market intelligence firm, Pokemon Go creator Nintendo is already bringing in $1.6 million every day in revenue. That translates to $584 million in terms of additional revenue in a year.

 

In-app Purchases an Inspiration for Other Brands

 

Candy Crush and Angry Birds also became huge hits, but Pokemon Go is faster in achieving popularity because of its association with Nintendo, already a household name. That accounts for the 7.5 million US customers already acquired by the company. It’s an inspiration for other PC and console brands, and a clear indication that the freemium or in-app purchases industry is going places. Investors need to keep their eyes and ears open for that.

 

For people in England doing online stock trading in American stocks, TradeZero offers the resources, insight and technological solutions. Feel free to give us a call at +1 954-944-3885 or email us at support@tradezero.co.

 

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