Revolutionizing Mobile Game Monetization: A Conversation with Maor Sason
Editor’s note: This is a podcast originally published on Soar Payments’ blog. Listen below or continue reading for the transcript.
Maor Sason is the founder and CEO of Appcharge, a revolutionary platform aimed at helping mobile game developers retain more of their revenue by offering direct-to-consumer stores. With a background in in-game advertising, Maor has been at the forefront of mobile gaming innovation since 2016. His work focuses on empowering developers by reducing the dependency on major app stores like Apple and Google, which take a significant percentage of in-game purchase profits. With Appcharge, developers can keep up to 95% of their earnings, allowing for greater control over their revenue and a more flexible gaming experience for users.
Before launching Appcharge, Maor had an extensive career in the mobile gaming space, working closely with major studios and advertisers. He played a significant role in the free-to-play revolution that transformed the gaming industry, where users can enjoy games for free while being offered paid upgrades, bonuses, and extra content. Maor has collaborated with top-tier game development companies like Coin Master and Play, helping them scale their operations and increase profitability through innovative monetization techniques.
Maor’s work has been instrumental in shaping the mobile gaming industry, particularly as new challenges, such as Apple’s iOS 14 privacy updates, change the way games are marketed and monetized. His deep understanding of user acquisition strategies and the economics of gaming has positioned him as a thought leader in the field. With Appcharge, Maor continues to drive the industry forward by offering developers the tools they need to build successful, sustainable gaming experiences in an increasingly competitive market.
Episode Transcript
Kevin Rosenqvist: Hey, welcome to Pay Pod, where we bring you conversations with the trailblazers shaping the future of payments and fintech. My name is Kevin Rosenqvist and thanks for listening. Maor has been in the mobile game space for almost a decade. He started with in-game advertising and now he’s built Appcharge, a platform for mobile game developers to monetize by offering players chances at bonuses, rewards, and in-game purchases. And the best part for gaming studios is that they keep the majority of their revenue, rather than having to kick up to 30% back to Apple and Google. Maor Sason and I talk about mobile gaming. We reminisce about the Game Boy, and I get his take on what gaming in the metaverse might look like. So please welcome Maor Sason. I enjoy some mobile games, particularly card games like Euchre. I like to play euchre. My first question for you is very, very important. Can you make them give me like a million coins? So I’m set for a while.
Maor Sason: Easy. I’m gonna give him a call tomorrow. Okay. Yup. Yay!
Kevin Rosenqvist: Kevin needs some coins.
Maor Sason: Yeah, this is gonna holler at you. Yep.
Kevin Rosenqvist: That’s right. I remember when mobile games first take off and I first took off. And I remember the first time I discovered sort of the model of offering the game for free and then having the option to pay for upgrades, extra lives, coins, etc. at first it was kind of like what? I thought this game was free. But then you think about it and you’re like, wow, that’s a that’s a brilliant like that’s like a brilliant way to to to do a game like offer it for free and then then you can upgrade with within it. You’ve been in this space since 2016. Have you found that players are more likely to spend in-game than they used to.
Maor Sason: Of course, mobile spending goes up like the average spending per paying users in all platforms are going up, especially in mobile. Free to play is actually, I would say, the only way to build a proper game and monetize it in mobile nowadays. There’s no other way to do it and it’s proven itself. It’s kind of like gave birth to some of the biggest titles in the industry. You probably know of them. Also here in Israel we have a great team. Games like, studios like Coin Master, Playtika, Plarium, all the Israeli based. So we’re pretty familiar with that.
Kevin Rosenqvist: What type of games are the ones like the most successful? The biggest ones? Are they Maor Sason of the, you know, card games or are they more of the building worlds kind of games? What’s really the hottest thing right now?
Maor Sason: Oh, there is no one category to rule them all. You know, it’s not a it’s not a Sauron Ring, but starting from a puzzles the all kinds of social casinos RPGs every niche has some MVP’s and they can generate tons of cash and entertainment for their users. So mobile mobile is a star and it’s taking all the categories up with it. , yeah.
Kevin Rosenqvist: It’s funny because like, I think about my Game Boy that I had as a kid, you know, this little tiny.
Maor Sason: What were you playing?
Kevin Rosenqvist: What’s that?
Maor Sason: What were you playing? I was planning to add. Like my Game Boy color the purple one. What was your favorite?
Kevin Rosenqvist: Well, I had the original, like the white game boy. That was just the green.
Maor Sason: Oh yeah. Oh yeah.
Kevin Rosenqvist: No, I’m I’m, I’m old man so I, I’m old. But yeah, I had I mean Tetris was the obvious one that was like super, super big. And then, uh. God, there was another game that I can’t remember. It was like an adventure game. I don’t know if it was a Zelda, but it was something in that realm where you kind of walk around and stuff. But I think about that, and I think about what I’m able to do with my phone now, and it’s just startling how far we’ve come. Yeah.
Maor Sason: People still play these games, by the way. Like, so Pokemon was my first game on the Game Boy Color. It was the red like a Charizard. And by the way, the logics and the interest for Pokemon. Have you ever played? No, it’s based on Zelda, actually. So like the whole game mechanics is just a Nintendo took it from Zelda, brought it to Pokemon, and they did it the same now on the new console. And it’s working really well.
Kevin Rosenqvist: Wow. It’s just the same even on the new console.
Maor Sason: On the switch?
Kevin Rosenqvist: Yeah, on the switch, it’s the same. That’s interesting. That’s really interesting.
Maor Sason: Yeah, yeah. With the open world. Zelda, if you had a chance to play. Yeah. Breath of the wild.
Kevin Rosenqvist: Yeah. That sounds awesome. I have a three and a half year old. So pretty soon he’s gonna start when I hand him a video game controller. Now he just mashes the buttons. But pretty soon he’s going to start beating me at stuff. I know it’s going to happen.
Maor Sason: Yeah. Or it’s gonna, you know, it’s just going to be very polite and it’s going to manipulate you to let them play every day, the whole day. That’s what usually happens.
Kevin Rosenqvist: Don’t tell me that I don’t know.
Maor Sason: Yeah. They’re getting more sophisticated.
Kevin Rosenqvist: It’s incredible even watching him with his tablet, I’m just like. I didn’t even know he could do that, you know? Like, he’s like, wait a minute. Are you buying something? Like.
Maor Sason: Yeah. Yeah, yeah. They they’re they’re like controlling the the consoles, the iPads, the iPhone. It’s like, you know, they’re like yeah.
Kevin Rosenqvist: Yeah, it is like Spock. That’s a good analogy. Yeah. So mobile gaming is a huge market in 2023. The global mobile game market generated $76.7 billion, and it’s expected to grow to over 100 billion by 2028. I also saw that mobile games accounted for over 55% of consumer spending on mobile devices in 2023, which really blew me away. But what a lot of people didn’t realize is that a lot of the revenue is taken by Google and Apple. Like if you more fees for having their stores and stuff. How much do they take? As a general rule.
Maor Sason: First of all, about the numbers. I know that I’m affiliated with a bit different numbers. Nowadays, mobile games in-app purchase spending should be around $110 billion and will account for like, I think it’s going to be 200 billion by the end of the decade. Wow. Okay. Insane numbers. Okay. Yeah. Apple iPhone. Yeah, Exactly. Increased and increased expectations. Apple and Google’s business model is that they’re charging 30% for all digital goods. It means it’s not like a tangible like shoes, food, clothing, anything that you can hold. They’re taking 30% unless it’s a subscription. If it’s a subscription first purchase is like 30%. Then the recurring ones are 15. So it’s big money. Yeah, that’s a lot for quite a service, but not the best, you know. Not a lot of competition to incentivize, to give a better service. So it’s a lot deep down in the developer’s pocket. And it’s kind of like taking the industry down in a sense. Ios 14 with a updated privacy. Are you familiar with the update of iOS 14?
Kevin Rosenqvist: No.
Maor Sason: No. So in a nutshell, a few years ago, I think it was like for Apple updated the iOS 14 update. And then in terms of privacy, you’re able to opt out when you install an app and they recommended to you instead of like they opt you in automatically in order to get out of the system and not to have the data saved, you need to go to the settings and go to like a complicated funnel. What it led to is that most people don’t want to have their data saved, and then they were not tracked. And then it’s harder to target you as a user. And that led to way higher prices to target you as a user, which led to a higher user acquisition cost for every user. And that’s kind of changing the game and the strategy for all game developers. So it really shakes the economy. On the gratitude of Apple. And I think that that’s going to take us to the direct to consumer strategy. That’s going to be like the savior for this whole mess. We’re helping mobile game developers to maintain or even increase their user acquisition strategy and capabilities even prior to iOS 14 update, saving the mediator the mediation costs. Let’s call it like this. It’s taking back like sane margins. And that’s where we aim to.
Kevin Rosenqvist: And so yeah, if your company is Appcharge and you allow companies to build custom stores, but they retain far more of their revenue. Correct. Yeah.
Maor Sason: More on the on the neighborhood of like 95% 5% rather than 70%.
Kevin Rosenqvist: That’s substantial. That’s a big difference.
Maor Sason: Yeah. Yeah. Yeah. So it’s more than 30% if you look at. That’s crazy.
Kevin Rosenqvist: I mean the 30%. That’s a huge number that they take. I mean, I didn’t realize that until I started digging into what you do and, , you know, that that blew me away. So, tell me how does Appcharge work? So I have a cool new game. It’s going to take the world by storm. I know it will. And I want to monetize by offering daily bonuses, chance for people to buy upgrades and whatnot. So what’s my first step? How do I do this with Appcharge?
Maor Sason: Let’s zoom out for a minute. But are you familiar with Shopify?
Kevin Rosenqvist: Yes. Of course.
Maor Sason: Imagine Shopify, but just for mobile game developers with all their unique needs and integrations and payment processing capabilities that we’re providing. We are a white label solution. And we’re the platform for mobile game developers that want to monetize outside of the platforms. And we build them the store straightforwardly. So if you’re a game, Kevin, and your domain is Kevin Combs, and you want to facilitate the shop on kevin.com/shop, you’re going to use the arbitrage platform to assemble the exact look and feel store that you have in game with all the necessary features that the ones, the cool ones that are getting retention, the ones that are the users are lusting for alongside with the service and the capabilities and the the integrations that you need in order to function and to work in harmony with your game. So that’s like in a nutshell, what we do, but it’s way more fun. It sounds complicated. It’s way more fun than that because it gets the people excited, like in their organizations and internally in the studio, so they can finally offer like cool bundles that they were not offering, not able unable to offer it to to gain to their users, and also is going to lead them to later on to buy more users and increase the gain and you know to find the more features and and more studios later on.
Kevin Rosenqvist: That’s awesome. That’s really, really cool. And so how would someone do it with Google or Apple? Like, would that just be like, is that sort of built into their functionality? Do they have to set it up the same way?
Maor Sason: No, no, it’s it’s a totally different platform and system that’s not connected to Apple and Google. It’s it’s oh, it is not even advertised. No no no no no. It’s a web store. It’s not the only thing that Apple is doing upcharge. We’re providing with comprehensive solutions right for direct to consumer. But if we’re talking about the web shop it’s external to Apple and Google. So imagine you have Apple, you have Google and you have your own shop on online on the web, just like if you would sell anything else on the web. And it’s not connected to Apple and Google, it’s not advertising in the game itself.
Kevin Rosenqvist: Okay. Yeah, yeah. And it’s like the user doesn’t even realize they’re going somewhere else. They just feel like they’re still in game, right?
Maor Sason: No, no, they’re totally aware that it’s, developers web shop. They see it as them helping the game developer that they love and are invested in. And they’d like to cut the mediator and invite direct from the developer, essentially. So let’s say you love a certain brand, and instead of going to the department store and get it, it’s like, hey, I love this brand. I’m gonna look online, what’s going on there? And the brand’s website, and you’re just going to buy directly. Probably you’ll see more products. Probably you’ll have a loyalty program that’s going to let you know with the newsletter if you’re really into the brand and you’re going to get like a better offering, it works like that. And every commerce in every industry, why not in gaming?
Kevin Rosenqvist: Mhm. Yeah, yeah. And you, you’ve been in this business for a while And you, you’ve been involved in the in the marketing and or advertising world within games as well, connecting advertisers to mobile games and showing video ads and and you know, as much as I dislike commercials when I’m watching TV, I tend to be someone who watches the ads in a mobile game rather than paying to go ad free. Am I in the majority, would you say? Or am I in the minority? From what your data has.
Maor Sason: I would say you’re not. You’re not a minority and you’re not a majority. It’s somewhere. Somewhere a fair split. Okay. yeah. Yeah. Depends on the category of the game, obviously. But there are so many ad based, revenue games that you can choose to to upgrade. I did my my first venture with advertising and it’s interesting. It’s obviously now I got familiar with what’s going on besides me, loving games and gaming. Imagine, just like I said, for improving the the economics in order to improve scale. So it’s interconnected, the marketing and the margins. So once we are empowering the developers and we’re expanding their margins, we’re, let’s say letting them own the users and control their marketing spend way better than they were. They can plan it differently and they can they can plan it more long term. And once I don’t want to talk like an industry terms, but when an average rate payer is changing, so, so does your whole marketing strategy. So it’s it’s funny that, you know, I got to this crossroads. I wasn’t expecting it, but, you know, when the penny dropped, it’s connected. So we’re also, being some kind of, like, advisory for some studios and how to improve their marketing strategy and and GTM.
Kevin Rosenqvist: So you offer a lot more than just a web store, then.
Maor Sason: Oh, yeah. We’re a full service. Your wish is my command.
Kevin Rosenqvist: All right, well, give me the million. You’re one to talk.
Maor Sason: Exactly. Were you planning your revenge, red alert?
Kevin Rosenqvist: No, I was playing. I was just playing a card game called Euchre. I just keep losing, I guess, I guess I.
Maor Sason: I need to play with you. You heard of it? Yeah. I heard you like hiking.
Kevin Rosenqvist: I like what you like.
Maor Sason: Hiking.
Kevin Rosenqvist: Hiking? Yeah, I do like hiking. Yeah. Yeah I do.
Maor Sason: You guys have good, good spots there in Colorado.
Kevin Rosenqvist: Oh, yeah, I’m in Colorado. It’s just like. Yeah, if you like to hike, this is. This is the spot for sure. This is about as good as it gets.
Maor Sason: Definitely in the bucket list.
Kevin Rosenqvist: Is it really? Have you come to Colorado?
Maor Sason: Yeah yeah yeah yeah. Like the the bouldering there is great. Yeah.
Kevin Rosenqvist: Uh huh. Yep yep. Very good. Yeah. So tell me what games you got. What are the what are the big games that you zap charge that that people might know.
Maor Sason: So we work with top studios. top 15, 20 studios in the world where there are some categories where, let’s say 60% of the studio is working with us, and I cannot disclose the names, but.
Kevin Rosenqvist: That’s all right. What would you say the what’s the most popular type of mobile game? Like what is the one that’s the most, you know, the one that’s the most popular.
Maor Sason: Popular?
Kevin Rosenqvist: like the type of game. Like what kind of games? What kind of games are people downloading the most? Would you say? Are they Cod games? Is it RPGs? Casual? Hyper casual?
Maor Sason: Think like in terms of numbers. Mhm. Mhm. Of uh of active users. Not not in terms of revenue.
Kevin Rosenqvist: Okay. Besides active users. Yeah. Yeah. That makes sense. That makes sense. Mhm. I was curious to get your take on, on something. And I don’t know how deep in the weeds you go in this. But you know we hear so much about the metaverse and all that and, and specifically how it relates to gaming. You know, one of the use cases for blockchain technology and NFTs that get a lot of people excited is how they will work within the metaverse, being able to exchange digital assets. I’m curious, do you do you think that is the future of gaming? Is the metaverse going to be the future of gaming as we know it?
Maor Sason: Metaverse is going to be the future of gaming as we know it. I think metaverse is definitely gonna play a big part in gaming as we know it. But I don’t think it’s gonna make all other ways to interact disappear. Like today. Like before smartphones. Mobile gaming wasn’t big, right? But they didn’t annihilate the console. And in a way, it’s like a compliment. It was reinforcing. Definitely. I see a bright future for the metaverse once the technology is going to be a bit more advanced. We can already witness it. You know, the capability of Apple. Wow. Have you tried.
Kevin Rosenqvist: It? I have, I tried. No, I have not actually tried it.
Maor Sason: You should, yeah I should. The vision for something. Yeah. Yeah, something. Something else.
Kevin Rosenqvist: I just feel like, I don’t know, I feel like, I don’t know if I would like having that thing on my face. I mean, it seems like it’s kind of cumbersome.
Maor Sason: Yeah. Yeah, yeah. Not for a daily walk. Like, you see, like these crazy people driving with it, but more for a living room. Office. You said entertainment.
Kevin Rosenqvist: Yeah. Are you excited about it? Like, is it as a whole? Do you think it’s. Do you think it’s pretty cool technology that you’re excited about?
Maor Sason: Definitely. Yeah, I’m excited about it. It’s making me wander, taking me to some, like, dystopian movies and books that I like. It’s there. Mhm.
Kevin Rosenqvist: Do you think you think you’ll, you know, try to try to move out, charge into, into that realm if it, if it takes off. Is there if you thought about that at all.
Maor Sason: No I don’t think that it’s, it’s there yet. Commercially there is only the beginning. There’s a lot to do there. Like in terms of, like, you know, in the industry doesn’t exist yet for us to help out. And it’s being controlled by the platforms essentially. Yeah, yeah. Apple and Oculus. Meta. But once it’s going to get big enough. Definitely. Yeah. Aperture has room to comment.
Kevin Rosenqvist: Awesome. Well, that sounds pretty cool. Hey Mary, thanks so much for being here. The company’s Appcharge. And, yeah, best of luck to you. And, continue, continue. Best. Best of luck with continued growth.
Maor Sason: Yeah. Thank you. Thank you so much, Kevin.
Without These 4 Key Compliance Credentials, You’re Risking Your Game’s Revenue and Reputation
I’ve spent the better part of my career building secure platforms for mobile games, and if there’s one thing I’ve learned, it’s that security and compliance are non-negotiable.
When you’re selling directly to players on web stores or in-app—especially VIP players who expect the best—there’s no room for error.
That’s why, at Appcharge, we didn’t treat compliance like a checkbox. It’s something we’ve prioritized to from the start.
Whether it’s ensuring that financial transactions are locked down, or that player data is kept private and secure, we’ve made sure our platform meets the toughest standards out there.
In this post, I’ll take you through the four key compliance credentials we focus, and why they matter so much for mobile game publishers like you.
4 Compliance and Security Credentials to Protect Your DTC Sales
1. Security First: SOC 2
SOC 2 compliance is critical for securing your player data and maintaining platform reliability. Appcharge is SOC 2 certified, meaning we passed an onerous 6 month review and audit from third party experts. This ensures the highest standards of security, availability, processing integrity, confidentiality, and privacy.
Why it matters: Leading mobile game publishers need to ensure that their direct-to-consumer (DTC) activities are always secure and available—especially when dealing with high value VIP players. SOC 2 compliance provides peace of mind by confirming that Appcharge is equipped to handle your game’s sensitive data without downtime or breaches.
2. Proactive Protection: Penetration Testing
Regular penetration testing is part of Appcharge’s commitment to protecting publishers and player data from cyber threats. Partnering with cyber security companies, we proactively test and strengthen our system against real-world cyber attacks.
Why it matters: In a DTC environment, even one security breach can damage player trust and lead to loss of revenue. Our ongoing penetration testing ensures your web store is continually fortified against vulnerabilities, keeping player data—and your reputation—safe.
3. Prioritizing Privacy: GDPR Compliance
Appcharge adheres to the General Data Protection Regulation (GDPR), ensuring that all personal data from players is protected with the utmost care. We enforce strict data encryption, consent management, and regular audits to keep your players’ information secure.
Why it matters: VIP players expect their data to be treated with respect and confidentiality, especially in a global market. By complying with GDPR, Appcharge reassures your players that their privacy is a top priority, keeping them loyal and engaged with your game and web store.
4. Financial Security: PCI – Level 1
As a DTC platform handling high volumes of transactions, PCI compliance is non-negotiable. Appcharge passed a rigorous process to obtain PCI Level 1 certification, ensuring all cardholder data is processed in a secure environment. Our financial systems are routinely audited and tested to identify and resolve potential vulnerabilities.
Why it matters: Payment security is crucial to avoid breaches that could lead to chargebacks, fines, or worse—losing the trust of your highest-paying players. With Appcharge’s PCI Level 1 compliance, your financial transactions – whether on a web store or an in-app SDK – are fully protected so you can focus on growing your business.
Make or break
We’re proud to be the DTC partner of ⅓ of the top grossing mobile games and don’t take this responsibility lightly.
Whether it’s the financial security ensured by PCI, the rigorous data protection from SOC 2 and penetration testing, or the privacy guarantees required by GDPR, we’ve created a platform that lets publishers focus on growth while we handle the compliance.
If you’d like to get more insights on mobile game monetization, web stores, and DTC, join hundreds of other industry leaders receiving our monthly newsletter, Monetization Unlocked. Click here to sign up.
Appcharge Named Best Payment Service Provider at PocketGamer.biz Mobile Game Awards
We’re thrilled to announce that Appcharge has been voted the Best Payment Service Provider at the PocketGamer.biz Mobile Game Awards, held during gamescom 2024!
This award is a huge honor for us, and it speaks to the hard work and innovation our team has poured into scaling our payment services for game publishers.
We’ve been on a mission to help the world’s leading mobile game publishers sell directly to players, and this recognition shows that we’re on the right track — but we’re just getting started.
We want to extend a massive thank you to our partners, clients, and everyone who voted for us. Your trust and support drive us to continue innovating and delivering top-notch payment solutions.
Stay tuned for more exciting developments on the horizon!
This Game Developer Had to Pay $23M After Misreporting Taxes – Here’s How to Avoid The Same Fate
In 2023, Epic Games’ finance team got a call from Tokyo’s Tax Bureau. They just discovered that between 2018 and 2020, the company failed to declare its income from microtransactions in Fortnite in Japan.
They fined Epic and made them pay the consumption tax (AKA sales tax/VAT) retroactively – a total of $23 million.
So, while the subject of sales tax may not inspire mobile gaming executives to jump out of bed each morning, failing to comply with sales tax requirements will certainly keep them up at night.
With that said, what does a mobile gaming leader with direct-to-consumer (DTC) ambitions need to know about staying sales tax compliant – and avoiding a hair-raising phone call from a foreign tax authority?
First, a little context
Before jumping into our key insights, it’s worth explaining when exactly tax on digital goods becomes a responsibility for mobile game publishers.
Apple and Google handle this on your behalf when you sell in-game items within their payment ecosystems – in return they take 30% of your margins.
But the moment you begin selling to players on web stores, outside of the Apple or Google ecosystem, you take on full responsibility for VAT/sales tax compliance.
It’s a massive headache, but the juice is worth the squeeze, with publishers such as Playtika earning 25% of their total revenue from direct-to-consumer sales.
How to Stay Sales Tax Compliant
To stay sales-tax compliant, there’s a long list of responsibilities and processes you need to follow:
1. Understand Your Global Tax Obligations
Start by researching regional tax laws on digital goods wherever you have customers. Tax laws can vary significantly from one region to another. For example:
The U.S state of Delaware has no sales tax at all
Some states, like Tennessee, have digital sales tax rates of up to 9.75%
In Australia, there is an annual sales threshold of AUD 75,000. Businesses below this threshold are not required to register for Goods and Services Taxes.
These are but 3 examples of unique governance, but many more exist – and the burden of understanding due process and proper reporting rests on you, the seller.
2. Set up entities in relevant jurisdictions
In many countries, you have to establish entities and set up local bank accounts to register your business on the ground.
In the U.S. you have to establish entities in approximately 27 different states. This can take months and costs a lot of money (lawyers, bank accounts connected to the entity).
In the EU, you just need to register one local entity.
In Japan, foreign businesses must establish a local entity and register for consumption tax if their taxable sales exceed JPY 10 million in the previous fiscal year. Additionally, the business must appoint a local representative to handle tax matters.
3. Register with the tax authorities
You have to register with the tax authorities in almost every state or country you’re selling in. Yes, you read that right – whether you’re selling to players in the U.S, Japan, Germany or almost any other country, you need to register with the local tax authorities. Lawyers and accountants will be needed, which can be costly.
4. Calculate the right taxes for every transaction
For every transaction, your game has to calculate and show users how much VAT/sales tax they owe and will be charged. In some countries, like the U.S, there are multiple layers of sales tax you could be liable to pay on digital goods, depending on the location of the buyer. The tax tiers include federal, state, county, city, and a category defined as ‘special’.
For example, if a player in Dallas, Texas, buys an item in your web store for $10 USD, you’d have to calculate:
State: 6.25% ($0.65)
City: 1% ($0.1)
Special (Dallas Mta Transit): 1% ($0.1)
To accurately calculate the correct amount of tax for each sale and reduce the risk of human error, publishers should use a tax automation service such as Avalara, or use the services of a Merchant of Record such as Appcharge.
5. Implement Accurate Tax Collection
You as the seller are required to charge and collect the tax payment from players for every transaction. A couple key points here:
You have to keep the collected tax payment separate in a sub account, in the currency it was received in.
You need to send the buyer a receipt, invoice, or payment request.
6. Report tax promptly and accurately
Every month or quarter, you have to file tax reports in all the relevant tax authorities whose regions you’ve done business in – even in areas with 0% sales tax. To do this, you need to build a system that pulls transactional data from your game, and exports it to a spreadsheet with a detailed breakdown that includes, for each transaction:
The user’s specific location
The local currency
The amount of sales tax charged
It’s a huge amount of data to manage, and it has to be accurate – so make sure you meticulously maintain your records to avoid potential penalties.
Note that you’ll need to submit this data in different formats in various countries and states, for examplein Saudi Arabia you will have to issue the invoices in Arabic, and in South Korea you will have to share all the invoice details (which is not required in the US).
Tax Compliance For DTC Sales: A Worthwhile Headache
With great opportunities come great responsibilities. To recap, in order to sell digital goods globally via your web store while avoiding serious penalties (or even worse – jail time), you need to:
Keep track of complicated, often changing global sales tax/VAT regulations
Establish dozens of local entities
Register with local tax authorities
Calculate the correct sales tax for every transaction
Efficiently collect the sales tax from every transaction
File numerous tax reports every month or quarter
This doesn’t just represent a major operational burden – but also a financial one. You need lawyers and accountants to help with the process, in addition to a team of finance specialists to run this whole operation. It’s a lot, but it’s doable if you have the resources – and the rewards are certainly worth it.
Doing All Of This At Scale Is What We Do At Appcharge
If it sounds overwhelming to do it alone with in-house resources, you can and probably should consider using a Merchant of Record like Appcharge. We do this at scale for some of the biggest mobile game publishers in the world and we’d be happy to help you too.
As a comprehensive solution for direct-to-consumer sales for mobile game publishers, we offer full Merchant of Record services – meaning we take the entire tax compliance process off your plate.
Our team manages entity creation, tax authority registrations, calculations, collections, filings, and everything in between to let you focus on growing your web store revenue.
Everyone Faces Fraud in Mobile Game Web Stores. But How Do You Fight It, Exactly?
Managing a mobile game web store can be a rewarding venture, with publishers increasing their margins by up to 25 percent per transaction. But selling outside the Apple and Google ecosystems also comes with its own set of challenges, particularly when it comes to fraud and chargebacks – which have grown by 20% annually.
Picture this: one of your players decides to file dispute claims on thousands of dollars worth of past transactions, for no justifiable reason. This is not a hypothetical scenario – it’s a real case we recently encountered in one of our partner’s stores. What do you do? How do you fight this?
There are typically two options as a publisher: issue an automatic refund, which of course means losing revenue.
Or, collect evidence – such as player activity logs and previous communication with the player – and file a counter dispute file to the bank.
Luckily for this publisher, they had us as their Merchant of Record (MoR) to fight their corner and win them back their money. But this anecdote is just one of many types of fraud that can plague mobile game web stores. From abusive dispute behavior to stolen credit cards, we’ve seen it all. Below, I share what to look out for and our advice for how you too could combat fraud.
Types of Fraud
First thing’s first, let’s establish the 5 most popular types of payment fraud in mobile game stores:
1. Abusive Disputes
One of the most common forms of fraud we see involves players abusing the dispute process. Players submit numerous disputes on payments they’ve been charged for, often due to dissatisfaction with the game or buyer’s remorse. In some countries, disputing payments is as simple as a few clicks in a banking app.
How to spot it: When a user sends a dispute, they must give a reason such as “Item not received”. You can spot an abusive dispute claim in this case by investigating player activity logs. If you see the item in question was added to the user’s in-game profile, their claim is highly likely to be fraudulent.
2. Claims of Unauthorized Payments
Another frequent issue is players claiming someone unauthorized – such as their underage child – made the payment.
How to spot it: If the payment was made using Google/Apple Pay, which requires authentication phases such as FaceID, it’s clear the claim is fake.
3. Creating Multiple IDs and Disputing Transactions
We also encounter players creating multiple accounts – for instance, if they get blocked by the publisher for chargeback abuse, or if they ask to be blocked as they’re addicted to the game, but then regret this and want to re-enter. They then proceed to submit unjustified chargeback claims out of frustration. This can create significant financial losses and administrative burdens for publishers.
How to spot it: A telling sign of this kind of fraud is if you find multiple player IDs, all associated with one email or credit card, that are sending disputes.
4. Using Multiple Credit Cards from Different Countries
An obvious one – fraudsters often use multiple credit cards from different countries to make fraudulent purchases. These cards are usually stolen, and the legitimate cardholders will eventually dispute the charges.
How to spot it: You can spot this kind of fraud by tracing a single user ID to multiple transactions all with numerous different credit cards.
5. Emulator or Bot Usage
Fraudsters are known to use emulators or bots that use stolen card information. These tools can manipulate in-game economies and generate unauthorized in-app purchases.
How to spot it: You can spot this kind of fraud if the same player sends numerous payment attempts in an extremely short amount of time. Your team or Merchant of Record should automatically flag this kind of activity.
Combating Web Store Fraud
Now that we have a better grasp of the popular types of fraud you’re likely to encounter, let’s switch gears to discuss how to combat them.
Fighting fraud without Apple or Google’s support may seem daunting, but there are various tactics that can help you limit fraudulent activity, or at least manage it effectively when it does happen.
What’s more, you don’t have to do it alone. In fact, working with a gaming-focused Merchant of Record like Appcharge means you don’t have to do anything at all: we take payment disputes and fraud off your plate entirely, so you can focus on building a kick-ass web store.
But whether you decide to handle fraud with in-house specialists or let an MoR take responsibility for everything, here are our tips for helping you run a tight ship:
1. Maintain Organized Records of Player Activity
Ensure you have an organized record of player activity in your game, so you have a bank of evidence to help dispute false claims.
2. Monitor for Unusual Patterns
Hire fraud analysts to monitor for unusual transaction patterns and flag transactions that seem suspicious.
3. Use Anti-Fraud Engines
In addition to human-led monitoring,use dedicated fraud engines that leverage AI and machine learning to detect and block fraudulent transactions. Dedicated engines are generally more effective than the fraud technology offered by PSPs. The right engine will also know how to minimize false positive cases – in which transactions are blocked after being falsely flagged as fraudulent.
4. Provide Alternative Payment Methods (like digital wallets) in your web store
In contrast to credit cards, most digital wallets (like Apple Pay) require another form of authentication to complete a transaction. With 5.3 billion users expected to use digital wallets by 2026 – more than half the world’s population – make sure you provide a broad range of digital wallet options to ensure every user gets their preferred method. In doing so, you’ll reduce the amount of fraudulent activity on your web store, increase your conversion rates, and provide a great UX.
New Revenue, New Headaches
Despite the ongoing battle publishers face against fraud, web stores present a tantalizing opportunity. The fact that Playtika earns 25% of their total revenue from D2C sales is testament to this. Other leading publishers, like Huuuge Games, are also seeing healthy growth in D2C revenue, expecting it to reach mid-teens as a percentage of total revenue in 2024. In other words, the juice is definitely worth the squeeze!
While some publishers may choose to handle fraud by hiring in-house specialists, most choose to use Merchant of Record providers to take on full responsibility for all of this.
If you’re interested in learning more about the day-to-day fraud struggles my team handles on behalf of our partners, reach out at appcharge.com, or drop me a message on LinkedIn!
Merchant of Record vs. Payment Service Provider: A Simple Guide For Mobile Game Developers
Selling directly to mobile gamers on a web store, outside of Apple or Google’s ecosystem, means you’re responsible for everything needed to sell globally.
That includes processing payments, handling refunds, chargebacks, and fraud, abiding by country-specific regulatory compliance, paying sales tax, and more.
Publishers who wish to outsource some or all of these responsibilities generally have two types of providers to choose from – a Merchant of Record (MoR) – such as Appcharge, or a Payment Service Provider (PSP) – such as Stripe.
But there’s a big difference between these two solutions and what they cover, which is why we put together this guide. Let’s dive in.
Merchant of Record vs. Payment Service Provider: A Quick Comparison
Feature
Merchant of Record (MoR)
Payment Service Provider (PSP)
Provides payment processing tech
✓
✓
Connects to banking network
✓
✓
Offers a broad range of payment methods
✓
✓
Protects against fraud
✓
(For additional cost)
Handles chargebacks and disputes
✓
(For additional cost)
Handles customer service issues
✓
(For additional cost)
Responsible for data security
✓
Depends on service
Ensures tax compliance
✓
✗
Acts as the seller of record
✓
✗
Manages financial liability
✓
✗
Simple integration and setup
Depends on service
✓
Manages broader legal compliance
✓
✗
What is a Payment Service Provider?
PSPs are the middleman between customer bank accounts and payment methods (like Visa or Paypal). They facilitate the payment transaction, and take a fee for this.
PSPs do not serve as the legal seller nor do they assist with various other financial responsibilities shown in the table above.
Examples of PSPs:
Stripe, Nuvei, Checkout.com, Adyen
What you get with a PSP
Payment processing: The core function of a PSP is the technology to accept various payment methods, process payments, and connect to the banking network.
Fraud Protection [for additional cost]: Some PSPs will give the option to pay for fraud protection in addition to payment processing.
Chargebacks and disputes [for additional cost]: Chargebacks are a real financial and time burden for merchants. Some PSPs will offer a service to handle chargebacks for an additional fee.
What kind of gaming company should use a PSP?
Choosing a PSP instead of an MoR makes sense if your game is heavily focused on one market, and therefore doesn’t need to pay fees for international coverage and global tax compliance. Such companies can still supplement the core payment processing functionality of a PSP with additional features like fraud protection and chargeback support, for extra fees.
Another scenario in which a PSP might make most sense is when publishers have already built their own D2C ecosystems, with in-house finance specialists. They might need only the payment processing technology of a PSP and not the whole payment operations stack of an MoR.
What is a Merchant of Record?
A Merchant of Record is a holistic, one-stop solution for your D2C payments.
Your MoR acts as the seller of record in transactions, assuming full financial liability for transactions, including taxes, chargebacks, and refunds.
Examples of general MoR companies:
Fast Spring
Reach
Examples of gaming-focused MoR companies:
Appcharge
Xsolla
What you get with an MOR
Payment processing – An MoR will integrate and maintain multiple B2B payment processors or payment service providers to facilitate payment routing and cascading, reducing the risk of payments being mistakenly declined as fraudulent and resulting in lost revenue.
Fraud protection – An MoR will offer detection of fraudulent orders, manual review of suspicious orders, and custom rules to protect your business.
Merchant Accounts – An MoR will set up multiple merchant bank accounts in countries where you have a significant customer base, enabling you to accept global payments.
Disputes and refunds – An MoR handles payment reconciliation, refunds, and chargebacks, ensuring a smooth process for both you and your customers.
Local entity creation – An MoR will set up local business entities to facilitate merchant accounts, tax registration, payment relationships, and more.
Currency conversion – To reduce any friction from the user’s payment experience, an MoR will automatically convert the prices to local currencies.
Tax compliance – An MoR will calculate, file, and remit software sales tax in the locations your customers reside in, ensuring compliance with local regulations.
All of these things are required to power global D2C sales – the decision is whether you want to outsource everything to an MoR, or combine a PSP (with limited add-ons) with in-house specialists.
What kind of gaming company should use an MoR?
Publishers selling D2C web store items to a global market, who would rather outsource the complexities this entails to a trusted partner instead of hiring finance teams in-house.
Merchant of Record vs. Payment Service Provider: Which Option is Best For Mobile Game Publishers?
The boring answer is that it depends. Both options offer varying benefits, but the choice relies heavily on your company’s specific needs, the extent of your global market reach, and how much of the financial and legal responsibilities you’re willing to manage in-house.
We’ll take this moment before you go to mention that we offer gaming-specialized MoR services that are battle-tested with some of the world’s biggest publishers. Should you wish to get in touch to learn more, you can book a demo via our homepage.
Mobile Game Web Stores: Should You Build or Buy Your Tech?
In 2023, nearly every major mobile games publisher launched a web store. There’s a reason for this: by carving out a direct-to-consumer sales platform, publishers bypass the traditional 30% fees on all transactions. In doing so, they can provide users with exclusive and generous offers while significantly increasing profit margins.
It’s a much-needed win for publishers, who are feeling the squeeze due to challenging industry trends, and it’s also a win for players, who receive far more value for their money in the offers presented to them in web stores.
With these tailwinds, we expect to see a surge in web store adoption in 2024 from both medium and large sized publishers. Which begs the question: how do you actually create a web store?
There are two key components: creating a functional store, and handling the payment operations to enable global sales.
To do this, you can either build out your web store and its payment operations in-house, use a white label, out-of-the-box web store platform to do everything, or use a combination of both (for example, developing your own store but outsourcing your payment needs to a web store platform).
By the end of this guide, you’ll understand the pros and cons of these approaches and be a step closer to executing your game’s web store.
Let’s dive in.
What’s behind a successful mobile game web store?
The list shown above demonstrates just some of the key components of a mobile game web store.
With this in mind, let’s take a look at the pros and cons of building a web store in-house from scratch, before looking at the alternative approach – leveraging a white-label platform where the tech is already taken care of.
Building your own game web store from scratch
The pros of building your own web store
Full autonomy
Building a web store in-house means your tech and tools belong solely to your company. You’ll always be in full control, eliminating any risks posed by the reliance on a third-party vendor, and keeping communication internal – especially useful if you have a big team.
In addition, your web store will become part of your studio’s core technology stack, adding value to your company.
Complete customization
When you have a team of in-house engineers and product designers building your web store from scratch, you’re able to mold your store whatever way you’d like to meet the specific needs of your game.
That’s an attractive proposition for many developers, but it comes with a cost. Dedicating a team to not only take a web store from 0 to 1 but then maintain and customize it constantly once it’s live is a major commitment, both in time and money.
Higher margins on sales
White label web store solutions take anywhere from 5% to 15% per transaction. While still a far cry from the traditional platforms’ 30% cut, some developers may deem it worth the investment to avoid fees altogether by building their web store in-house.
This means they can pocket the highest possible margins per transaction. However, that must be weighed against the considerable cost of hiring a dedicated team of engineers and product designers to build and manage the store.
The cons of building your own web store
It’s expensive and time-consuming
Some studios with enough manpower can put together a team from their existing workforce to at least build an MVP of a web store.
But to build a robust web store, equipped with all the functionality and features that keep players coming back and making repeat purchases, you’ll need to hire a team of specialist engineers and product designers.
We’ve seen large publishers dedicate 10 to 15 people to building a web store. Not only is it a lengthy process to hire the right people, but once you have them it also takes considerable time to build and launch the store. That’s expensive – both in time and in money.
Being your own Merchant of Record is a headache
When you start selling to players outside of the traditional App Stores, which take care of all Merchant of Record services as part of their 30% cut, you take on this responsibility for facilitating global payments.
Becoming your own Merchant of Record means hiring experts to handle local taxes, currencies, exchange rates, invoicing, billing and fraud prevention. This newfound responsibility also introduces the risk of exceeding chargeback limits, potentially resulting in penalties or even the blocking of your game by payment providers.
If you want to build your web store in-house but feel overwhelmed by the idea of managing these financial intricacies, opting for a gaming-focused MOR provider can make a lot of sense [holistic web store platforms like Appcharge offer both an MOR solution and a web store builder].
Maintenance and management is an ongoing burden
A successful web store isn’t completed once it’s been launched. Just like a mobile game, it is a living, breathing entity that requires constant iteration and optimization.
If you build your web store internally, every change to your web store – from new artwork to new gamification mechanics – will require development work. Ultimately, this slows down your time-to-market for every iteration and creates operational overheads.
Building your own web store: a brief summary
Building your D2C web store in-house gives you the ownership, control, customization, and margins per transaction to make top-grossing games.
Whether this is the best route for your company really depends on your team size, expertise, financial resources, and capacity to execute with speed and quality.
The challenge?
Well, you’re looking at a minimum of five highly-skilled (and very expensive) software engineers just to get you started.
Once you’ve found them, they need to become closely intertwined with the game development, LiveOps, and game monetization teams, ensuring that as new features, events, and offers are added to the game and product roadmap, the web store is able to support these initiatives simultaneously.
All the while, you need to ensure all of this effort is supported by robust Merchant of Record services to handle the complex world of payments.
Using a white-label web store for your mobile game
Using a white-label platform, instead of developing your own technology, is a more efficient way to build out your mobile game web store. But is more efficient actually better? Let’s see.
The pros of using web store tech for your game
When chosen smartly, ready-made and purpose-built web store technology can supercharge your mobile game’s bottom line profit. Let’s take a look at four of the top reasons why.
Maximize your profits
Hiring a team of specialist engineers and product designers to develop just a ‘vanilla’ or MVP version of your web store can take around 4 months and is expensive.
Fortunately, in the same way you can bypass the traditional app stores’ 30% fees by launching a web store, you can also bypass the aforementioned development costs by leveraging an out-of-the-box platform, which has done all the heavy-lifting for you.
Not only does this save you significant development costs, but it expedites your time to market so you can start selling items faster. More on that below.
Faster time-to-market
With a seamless API integration using a white label platform, you can get a web store to market in a matter of weeks. One based on battle-tested technology and with all the features you need to succeed. Compare that to the time it takes to actually begin earning from an internally built web store – remember you need to assemble a team of specialists, develop a platform, and ship it – you’re saving a huge amount of time. And time is money.
Payments taken care of
Payment infrastructure is one of the biggest headaches faced by publishers who opt to build web stores in-house. A white-label web store platform like Appcharge handles all of your Merchant of Record needs, which is a game-changer for any company facing down the prospect of hiring experts to handle local taxes, currencies, exchange rates, invoicing, billing, chargebacks, and fraud prevention.
Easy updates and optimization
The right white-label web store platform makes it easy to update your store with new designs, art work, gamification mechanics, special offers, and more.
Given that most games these days operate as live services with dynamic LiveOps and frequent optimization, it’s crucial that you can update your web store frequently and without unnecessary hassle to keep up with this cadence.
Build or buy: A big decision for your mobile game monetization
The allure of ownership and control, customization, and higher margins per transaction may tempt some publishers to build a web store in-house. Some might opt for developing the store only and outsourcing the MOR part, to alleviate some of the burden. Others might decide to keep the whole thing in-house, from payments to store development. Either way, the required investment in time, effort, and resources is considerable.
On the other side of the spectrum, a holistic white-label web store platform allows game developers to build a robust web store with all its payments and MOR needs taken care of in a matter of weeks. This speed-to-market, both for launching and for adding new features in the future, is invaluable.
Equally crucial, outsourcing helps to maximize profits by avoiding hefty development costs, with platforms like Appcharge charging just a 5% fee per transaction.
Another important advantage of working with a web store platform is leveraging their expertise, so you can always stay at the forefront of D2C innovation and ensure your strategy is guided by specialists.
If you’re curious what to look for when choosing the right web store platform, this article should be helpful.
From Code to Checkout: Tackling the Top 5 Challenges in Crafting Your Game’s Web Store
By now, it’s no secret that a web store is the golden ticket to catapulting your mobile game revenue into the stratosphere. But the path to building a successful web store is riddled with challenges, requiring a strategic combination of skilled professionals and a carefully allocated budget.
Game developers often plunge into this venture unaware of the intricacies, only to find themselves tumbling down the rabbit hole of unforeseen costs and missed deadlines. Here’s our top list of challenges to take into consideration before you start building a web store from scratch, to ensure you’re well-prepared for the complexities that lie ahead.
1. Assembling your team
Sure, assembling a team seems like a breeze: after all, your game studio is teeming with superstar developers, product managers, designers, and analysts. But how web-savvy are they? Proficient in game app development, your team might lack the expertise required for the intricate task of building a web store.
Moreover, as a game developer, you’ll probably want to prioritize… well, game development goals, reserving your best talents for the game, and leaving a junior team grappling with a sizeable project. Balancing your team’s skill set is crucial to the success of your web store venture.
2. Doubling your effort (and then some)
Building a web store is not a one-off event; it’s an ongoing endeavor. Unfortunately, we often see gaming companies launch a basic web store only to let it gather dust due to the costs of maintenance. Ensuring the commitment of your entire team, from marketing to LiveOps, increases the workload for everyone involved in terms of development as well as maintenance, but is also essential.
3. Being your own Merchant of Record
Launching a direct-to-player platform and avoiding the usual 30% transaction fees is (oh so) enticing, but what does it mean to handle your own transactions? How expensive is it? In case you decided to build both a web store and a checkout system, you are now not only delving into the web development sphere, but also embarking on a journey into the complex world of payments.
Becoming your own Merchant of Record means grappling with local taxes, currencies, exchange rates, invoicing, billing and fraud prevention. This newfound responsibility introduces the risk of exceeding chargeback limits, potentially resulting in penalties or even the blocking of your game by payment providers. If managing these financial intricacies seems overwhelming, opting for a third-party payment solution is a prudent choice.
4. Getting players to your store
Bringing players to your store is a challenge in itself. Due to legal constraints, advertising your store within your game is impossible. You’ll need a creative approach to user acquisition, including retargeting campaigns, direct messaging your whales, and leveraging online communities on platforms like Facebook, Instagram, or Discord, depending on where your audience is.
Training your community and account managers to navigate this uncharted territory is essential. Opting for an out-of-the-box store via a dedicated platform can be helpful, as the supplier can offer best practices and insights based on player behavior patterns across the industry. While you’re at it, be sure to also ask them for business strategy recommendations regarding which monetization tools are best to use for your particular game.
5. Keeping up with industry trends
The gaming industry moves at breakneck speed. New monetization tools emerge daily, promising unprecedented revenue increases. Amidst the daily grind of game maintenance, player management, and team oversight, keeping pace with these innovations becomes a formidable task. Developing and introducing new web store monetization tools to your audience requires vigilance, dedication, and of course, a substantial part of your budget.
Embarking on the journey of building a web store is undoubtedly an ambitious undertaking. But with meticulous planning, the right team, a decent budget and a clear understanding of the challenges, you can transform this endeavor into a lucrative opportunity for your game.
Play it Safe: The Appcharge Approach to Risk Mitigation
As game developers, we pour our hearts and souls into creating captivating experiences, while the risk of fraud and fraudulent chargebacks is always lurking in the shadows. The need for a robust risk mitigation strategy has never been more crucial.
In this article, we’ll delve into why risk mitigation is paramount for mobile game developers and explore how the Appcharge platform empowers you to safeguard your transactions effectively.
Appcharge’s Fraud Score
At the heart of Appcharge’s risk mitigation strategy lies the Fraud Score. Every transaction passing through our platform is meticulously evaluated and assigned a fraud score. This score serves as an initial assessment of the transaction’s risk level.
But how is this score calculated? It’s a blend of cutting-edge algorithms and historical data analysis. We consider various factors, such as transaction history, user behavior, and payment method, to assign a score that reflects the likelihood of fraudulent activity.
Transactions with high fraud scores aren’t dismissed outright. Instead, they are flagged for further review. We understand that false positives can be costly, so our approach is not overly cautious. Instead, it’s calculated and precise.
In our commitment to excellence, Appcharge collaborates with third-party anti-fraud software of the highest standards. This partnership ensures that our fraud detection capabilities are at the forefront of industry security. Your peace of mind is our priority.
Blacklisting Serial Fraudsters
At Appcharge, we have zero tolerance for serial fraudsters. Our platform blacklists individuals with a history of fraudulent activities across all games, creating a robust shield against repeat offenders.
Machine Learning Customization
Our machine learning capabilities allow you to define custom rules based on your unique business goals. Alternatively, you can opt for our recommended optimal settings, harnessing the power of AI to protect your transactions.
Optimized Manual Review
Appcharge streamlines the manual review process. We provide a centralized view of all flagged transactions, accompanied by rich contextual data explaining why each transaction was flagged for review. This ensures that your team can efficiently evaluate and address any concerns.
Extra Authentication for High-Risk Transactions
We understand the delicate balance between security and user experience. Appcharge applies extra authentication measures to high-risk transactions, without compromising your conversion rates. This targeted approach ensures that only transactions with elevated risk receive additional scrutiny.
Multiple Payment Methods
Offering multiple payment methods minimizes risk by adding layers of security and verification, making it harder for fraudsters to exploit vulnerabilities. Digital wallets require extra customer verification, such as biometrics or passcodes, while bank debits add an additional layer of security by verifying account ownership.
By providing these secure payment options, Appcharge ensures not only a smooth user experience but also a significant reduction in the risk of fraud, safeguarding both your revenue and player trust.
Chargeback Fraud: Navigating the Storm
Chargebacks can be costly, both financially and in terms of reputation. If your business loses a dispute, you could be liable for more than just the original transaction amount. Here’s how to handle chargeback disputes:
Customer-Centric Approach: When a dispute arises, it is recommended you proactively reach out to the customer, aiming to resolve the issue amicably.
Submitting Evidence: Timeliness is key. While reaching out to the customer for resolution, it’s crucial to also submit evidence within the required timeframe to prevent default wins for the other party.
Card Issuer’s Decision: It’s essential to note that Appcharge doesn’t make the final call on dispute outcomes. Card issuers have the authority to decide. We play our part by confirming that the evidence submitted meets requirements and promptly communicate the decision to you through our dashboard, webhooks, and API.
Appcharge’s multifaceted approach, encompassing advanced fraud detection mechanisms, efficient chargeback management, and the provision of secure payment choices, empowers developers with invaluable defenses against the evolving landscape of mobile gaming risks.
Understanding and implementing these strategies ensures that developers can forge ahead in their creative endeavors, fortified by the knowledge that Appcharge is a trusted partner in their journey.
Why Web Stores Offer a Better Deal For Your Mobile Game VIPs
We’ve already spoken about the $30 billion+ opportunity in the mobile games market. According to data.ai’s State of Mobile report, the sector generated $110 billion from player spending on in-app purchases in 2022. But due to the hefty 30% revenue share taken by Apple and Google, publishers saw ‘just’ $77 billion of that—the rest was scooped up by the platform holders.
Much of this revenue, of course, comes from the minority of players, your VIPs. But the App Store and Google Play make engaging with these players and providing them with deals more challenging than it should be—and they, of course, take that 30% fee.
That’s where an off-app payment system, or web store, can come in. Not only can this provide a much fairer deal for publishers—Appcharge, for example, takes just a 5% fee for powering transactions—but one of the biggest opportunities they offer is catering to those VIPs.
Community-Building
VIP users are the most engaged and highest spending players in your game. Ensuring a good experience, where they feel they are getting the appropriate rewards and perks for their investments, not only helps your title be successful, but can act as a reflection to how the wider player base feels about your game.
One of the best ways to do this (aside from in-game options such as clans, leaderboards, competitions, and various multiplayer modes) is to build your community outside of the app and onto platforms such as Discord, social media and even a dedicated website. These platforms let you engage with your players—and your VIPs—in ways that the App Store and Google Play don’t let you.
Through Discord, you can promote exclusive web store bundles, promote events with special giveaways available only out of the game, communicate directly with your players in a two-way conversation, and obtain direct feedback on specific features, updates, and what your players want to see most in the game. On Twitch, not only can the streaming platform help promote your title, it’s another way to share content and also promote exclusive web store offers. The same goes for social media—you’re meeting players where they are, while also having a platform to offer them the best deals, which you can’t do on closed mobile ecosystems.
It’s in these communities that you can build closer relationships with your highest spending players. Depending on your strategy, you could potentially communicate with players out of the game and through chatbots on Facebook, or via email marketing integration, to promote the latest and best deals. You could even offer limited-time discounts, bundles or even early access to new features, all through a web store that offers a better deal. By creating a direct-to-player monetization strategy, developers can increase their revenue and build a loyal fanbase outside of the restrictive app stores, rather than having to go through them.
Personalized Offers
A web store can work in tandem with your community strategy, particularly when it comes to VIPs. For starters, you have total control on the deals you can provide players and which price points to choose—and you are not at the mercy of any potential future policy changes by Apple or Google. This means you can provide better offers for players, who can get more bang for their buck when publishers don’t have to account for the 30% revenue share with platform holders.
For VIPs, you can offer a special loyalty program with better rates than in the app. What’s more, by powering your direct-to-consumer sales on Appcharge, you can segment your most important users and surface deals most appropriate to them. These deals can be personalized even to specific individuals, based on how they engage with the game and their current progress, and this entire process can be automated.
To attract players to actually engage with your web store, however, is no simple task. Many purchases in-game are made emotionally, an experience that is extremely challenging to replicate out of the app. That’s why building a community is important, and engaging with your top players to showcase the better deals on offer from your own store. The experience can also be improved by ‘gamifying’ the web store, making it look and feel similar to what players see in-game.
With Appcharge, developers can automate user segmentation, enabling them to create custom rules based on player behaviour, game progression, spending levels and habits, the country they live in, and preferred payment methods.
This personalization means developers can create and surface the most relevant offers to players, helping to increase conversion, and therefore revenue. And this all happens in an environment where publishers can take 95% of the revenue, not just 70%.
A Fairer Deal
Web stores have the potential to be much more than a way to obtain a better revenue share than mobile platform holders currently provide. They can play a key role in keeping VIPs happy and engaged with your game, ensuring they get the best and most relevant deals for their money, a process made easier by having a web store you control and generate higher returns from. By building communities out-of-app, publishers are able to go direct to players, build better relationships, and provide the most value.
Google Play Proposes Third-Party Payments in the UK – But is it a Good Deal for Developers?
The proposal, if enacted, would enable developers who provide options for both Google Pay and alternative billing to have Google’s revenue cut reduced by 4% to a 26% share (or 11% on their first $1 million)—if users pay through a different payment service provider (PSP). However, if developers do not offer Google Pay as an option, they will be penalised and the standard platform fee would only be cut by 3% to 27% (or 12% on their first $1 million).
Should users choose to pay with Google Pay, the revenue share will remain at a 70/30 split.
The changes would be rolled out for non-gaming apps first, before eventually allowing games developers to be eligible for the new billing rates and options “no later than October 2023”.
Google claims this would help ensure a “smooth transition for developers and to allow for the necessary changes to be made to our systems”. For context: In Q1 2023, data.ai estimates a large majority of worldwide consumer spending on Google Play came from the games category. It’s effectively a cash cow that is often treated differently by mobile platform holders than other categories.
The proposed changes would only impact in-app purchases in the UK, though similar actions have been taken in other countries.
Why Proposes Third-Party Payments Now?
Google’s announcement comes in response to an investigation by the UK’s Competition and Markets Authority (CMA), which began in June 2022, to look into “suspected anti-competitive conduct” by the tech giant. A particular focus of the ongoing investigation concerns Google Play’s rules which “oblige app developers offering digital content to use Google Play’s own billing system for in-app purchases”.
At present, the CMA’s position is that it believes the new commitments from Google are “sufficient to address the competition concerns”. While no final decision has been made, pending consultation, the CMA has proposed to accept the changes.
What Do the Changes Really Mean?
Any climbdown from the standard 30% revenue share should be considered significant, as Apple and Google fight tooth and nail to retain the status quo. This latest proposal is another example of platform holders making as small a concession as possible to retain their lucrative cash cows.
But while it may seem like a concession, for developers, the reality is that it will not make a notable difference to their businesses on the current terms. A reduction of 3% to 4% will not cover the costs of using an alternative billing system, where the revenue share is often 5% or more (AppCharge takes a 5% cut per transaction).
PSPs charge such fees to cover the costs of billing, invoicing, fraud, chargeback cover, etc. Such a small reduction in Google’s share means that, should customers use another payment system, it would actually cost developers a greater share of their revenue, not reduce it.
These terms mean that Google Pay keeps its position as the preferential payment method, while creating a challenging environment for alternative options. And of course, in any event, Google will continue to maintain its standard 30% share on all Google Pay transactions, thus effectively retaining the status quo. Of course, if you’d like to discuss potential alternative PSPs for an both in-app and out-of-app solution, you can speak to the AppCharge team.
Rick VanMeter, executive director of advocacy group The Coalition for App Fairness, which champions app store reform, told TechCrunch he believes the proposals would enable Google to “continue taking a massive cut on services they do not even provide”. He added: “This solution will not create meaningful competition and is a bad deal for developers and consumers.”
It remains to be seen whether the CMA will ultimately accept or reject Google’s proposals, and what the future of third-party payments will look like on the marketplace in the UK.
Regulatory Pressure
Apple and Google have both come under increasing pressure around the world over concerns about anti-competitive practices, namely over the exclusive use of their own payment systems in their app stores.
The UK proposal is now following suit with its previous successful negotiations with regulators.
Out-of-App Solutions
While it’s a positive step for Google to introduce alternative billing systems on its UK Play store, the current proposals aren’t a particularly attractive proposition. For developers really looking to take advantage of the $30 billion opportunity in the mobile games market – which is the amount of revenue the App Store and Google Play took last year from in-app purchases – the best solution still remains in utilising web stores.
By bringing your community of players to a web store, developers can offer better deals to players, all while retaining a higher share of revenue. Regulators continue to chip away at the app store monopolies, but the industry is a long way off from a fairer deal for all.
