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 options: building your web store in-house from scratch, or using a white label, out-of-the-box web store platform.
By the end of this guide, you’ll understand the pros and cons of each approach 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
Ownership and control
Building a web store in-house means your tech and tools are yours and only yours. 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 IP, adding value to your company.
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 need to manage all this entails by yourself.
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.
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 own mobile game web store is a huge investment in time, effort, and money. But building in-house does give you the ownership, control, customization, and margins per transaction you need to make top-grossing games.
If you have the team size, the expertise, and the financial resources to make it happen, as well as the capacity to execute with speed and quality, then it’s a smart move to build out your own game web store.
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 – which also requires hiring specialists.
It’s a tall order to execute, but done right, it pays off. But is it worth it? Well, it depends what the alternatives are.
Using a white-label web store for your mobile game
Using a white-label platform, instead of developing your own technology, can be an incredibly efficient and powerful way to build out your mobile game web store.
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.
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.
The Clear Advantage of White-Label Web Store Platforms
In the dynamic landscape of mobile game development, the choice between building an in-house web store from scratch and leveraging a white-label platform is pivotal. While the allure of ownership and control, customization, and higher margins may tempt some to pursue the former, the reality of the investment in time, effort, and resources required is undeniable.
Building a mobile game web store in-house demands a significant commitment, from assembling a team of highly skilled engineers to navigating the complexities of becoming your own Merchant of Record. The ongoing maintenance and iterative development further add to the operational burdens.
On the other side of the spectrum, the white-label web store platform emerges as a clear winner. Choosing this path allows game developers to maximize profits by avoiding hefty development costs, with platforms like Appcharge receiving just a 5% fee per transaction.
The speed-to-market is a huge advantage, with seamless API integration enabling a rapid launch compared to the prolonged timeline of in-house development.
In addition, the headache of managing payment infrastructure is alleviated by leveraging a white-label platform like Appcharge, which takes care of Merchant of Record needs, including taxes, currencies, chargebacks, and fraud prevention.
The ease of updates and optimization ensures that your mobile game web store remains dynamic and aligned with the evolving demands of players.
In conclusion, while building your own web store may offer a sense of control, the pragmatic choice lies in embracing the efficiency and cost-effectiveness of white-label web store platforms.
As we anticipate a surge in web store adoption in 2024, the advantages of maximizing profits, faster time-to-market, and simplified operations make the case for choosing a white-label platform compelling for savvy game developers aiming for success in the direct-to-consumer landscape.
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
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.
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.
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”.
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.
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.
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.