Pricing of Kids' Games on the App Store

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Pricing of Kids’ Games on the App Store

Pricing of Kids’ Games on the App Store

Dubit - Pricing of Kids’ Games on the App Store

Pricing Kids Games: What We’ve Done

Kids’ Mobile Games Smartphones and tablets have changed the games industry: The most popular games are free and in-app purchases are mainstream. But is this the case with children’s games? To find out we’ve combed Apple’s App Store to see the affect free-to-play has had on games for young children and to provide a guide to how to price your children’s mobile game or app.

What is a Kids’ Game? It’s difficult to say what is and isn’t a kids’ game. Angry Birds and Minecraft could be, but neither are exclusively played by children and neither’s publisher releases player demographics. For the purpose of this report we’ve looked specifically at games that Apple feature in the ‘Kids’ section of their App Store. These are targeted at pre-teens.

What’s a Game? For this report we’ve looked specifically at the iPhone section of the store. In comparing with non-kids games we’ve discounted non-entertainment apps, such as productivity apps, but included entertainment apps that aren't games, such as video streaming and music apps.


Pricing Kids Games: Kids’ StoreAs a bit of background, in September 2013 Apple added a ‘Kids’’ section to its App Store. The new section separated apps into three age ranges, those 5 and under, those between 6 and 8, and finally, those for kids between 9 and 11.


App Prices: ComparisonsLet’s start by comparing prices across all three age groups. We can see that apps for children aged nine to eleven are priced in a similar way to those for children aged 6-8, but with fewer apps priced at ‘free’. Children aged 5 to seven have the greatest break between free and paid for apps, with the prices leaping from ‘free’ to £1.49. They’re also the only group with apps priced at more than £4 in the highest grossing chart.

40%

36%

0.69 1.37 2.06 2.75 3.43 4.12 4.80 5.49

0.69 1.37 2.06 2.75 3.43 4.12 4.80 5.49

0.69 1.37 2.06 2.75 3.43 4.12 4.80 5.49

£4.99£4.49£3.99£3.49£2.99£2.49£1.99£1.4999p69pFree £5.49

5-7

9-11

6-8


App Prices: Under 5sLooking at the top 50 grossing apps for under-5s we see that most are paid for upfront: free apps take up only 36% of the top 50, but this is the greatest share of free apps across all ages. There are seven different price points, with none under £1.49. The three most expensive (£4.99) apps are Jolly Phonics, Endless Alphabet and ABC Pocket Phonics (all are educational - we’ll cover this later).

12% 36%

0.69 1.37 2.06 2.75 3.43 4.12 4.80 5.49

£4.99£4.49£3.99£3.49£2.99£2.49£1.99£1.4999p69pFree £5.49


App Prices: Six to EightFor children aged six to eight we see the emergence of the cheaper app, and fewer free apps making the top 50 cut. Free games make up only 22% of the 50 highest grossing and the most dominant app price is still £1.99. 58% of apps are priced at £1.49 or higher, compared with 64% at the younger ages.

22%

24%

0.69 1.37 2.06 2.75 3.43 4.12 4.80 5.49

£4.99£4.49£3.99£3.49£2.99£2.49£1.99£1.4999p69pFree £5.49


App Prices: Nine to 11With nine to 11 year-olds we see the greatest range of prices yet (nine), with no price point having a share greater than 30%. Free apps are much lower - perhaps parents aren’t as trusting of their IAPs? - and the £1.99 price point is still the most dominant.

30%24%

14%

10%

20%

0.69 1.37 2.06 2.75 3.43 4.12 4.80 5.49

£4.99£4.49£3.99£3.49£2.99£2.49£1.99£1.4999p69pFree £5.49


App Prices: All Kids GamesNow, when we order ALL those highest grossing apps from all ages something interesting happens. Although most games are still paid for, now we find a higher proportion are free (36%), meaning that - of the free apps detailed by age - they are more likely to gross higher than paid apps. Plus, this also reinforces the £1.99 price point as being the most successful of the lot - strong evidence of the thresholds that parents and kids will entertain.

40%

36%0.69 1.37 2.06 2.75 3.43 4.12 4.80 5.49

£4.99£4.49£3.99£3.49£2.99£2.49£1.99£1.4999p69pFree £5.49


All Apps: 98% Earn All Revenue From IAPTo see how different the ‘Kids’’ part of the App Store is to the broader market let’s look at the Total App Store Top Grossing chart. 98% of the games in the top 50 get all their revenue from IAP and only one game in the top 50 is paid for, this being Minecraft (£4.99). If evidence was needed that freemium is the most successful business model for mobile games, this is it.

94%

0.69 1.37 2.06 2.75 3.43 4.12 4.80 5.49

£4.99£4.49£3.99£3.49£2.99£2.49£1.99£1.4999p69pFree £5.49


App Prices: EducationAn educational bias to your game will generally help to sell it. Many of the apps aimed at these age groups include a level of educational benefit, whether it’s recognising colours or basic maths. But around a quarter of the 50 most successful apps are those that make their educational benefit clear in their title, using words such as ‘maths’, ‘phonics’, and ‘ABCs’.

0%

10%

20%

30%

40%

50%

Under 5s Six to Eight Nine to Eleven

Percentage of Apps in the Highest Grossing Chart With Educational Titles


App Prices: Free Less Important for KidsIt’s clear that to be a successful game in the Kids’ section doesn’t mean your app has to be free. Whereas 98% of the games in the general Highest Grossing chart are free, the majority of kids’ games in the three age groupings charge for downloading.

0%

25%

50%

75%

100%

All Apps Under 5 Six to Eight Nine to 11

Percentage of Free Apps in the 50 Highest Grossing Chart


App Prices: Changes by AgeThe price of paid-for-apps for kids which perform well in the Highest Grossing chart follow a similar pattern regardless of age. £1.49 - £1.99 is the most successful price point, although apps aimed at children aged six to eight peak a little later at between £2.49 and £2.99, implying that the middle-age-group can tolerate a slight hike in prices.

0%

25%

50%

75%

100%

69p - 99p £1.49 - £1.99 £2.49 - £2.99 £3.49 - £3.99 £4.49 - £4.99 £5.49 - £5.99

Under 5s Six - Eight Nine - Eleven

22%4%

4%

22%


IAP: Prevalence of IAP in Kids’ GamesThe growth of “free-to-play” games has raised concerns around in-app payments that may draw kids into spending unwittingly. Of all the games in Apple’s curated kids’ sections we can see that fewer than half of these games contain IAP - less than expected - which is in stark contrast to IAPs being present in 98% of All Games - a number that would be 100% if it wasn’t for Minecraft.

0%

25%

50%

75%

100%

Under 5 Six to Eight Nine to 11 All Kids All Games

Percentage of Apps Featuring In-app Purchases


IAP: Paid Games With IAPIt’s not only free games that carry in-app purchases: some paid for games do too, although it is rare. In most cases across kids games, if an app is paid for, it is free of IAP. (Some price-points were blank due to no apps being priced at these points in the top 50).

0%

10%

20%

30%

40%

50%

69p 99p £1.49 £1.99 £2.49 £2.99 £3.99 £4.99 £5.49

Percentage of Kids Paid-for Apps Featuring In-App Purchases


Pricing of Kids Apps: SummaryIt doesn’t have to be free. Unlike apps designed for all demographics, kids’ apps don’t have to be free to be successful. The majority of the highest grossing kids’ apps are paid for, with many costing more than £1. The average price of a successful kids’ app is £1.99 and this seems to be the most popular price point across most ages.

Most successful apps in the Kids section do not have any in-app purchases.

The older they are, the more they will pay. It’s possible to charge more for apps for older children with £1.49 and £1.99 being the optimum price points. These apps are less likely to contain IAP than those for children aged five and under.

In-app purchases for kids are used in a different way to other games. Instead of charging for ‘energy’ and other micro-payments they charge for subscriptions, extra books, lessons, or more levels/content.

Most apps for young children contain some educational content and a quarter make that clear in their title.

94%


Pricing of Kids Apps: The FutureWe expect to continue to see a range of pricing strategies on the kids’ section of the App Store and also an increase in IAP as discoverability becomes a bigger issue. discoverability is already a challenge and it’s one of the reasons why games sell expansions, such as extra levels or books. Creating an excellent hub-app allows your brand to become the destination parents and children go to for more games, rather than the App Store. It’s what apps like the hugely popular Disney apps, Disney Junior Play, Disney Storytime and Disney Princess: Story Theatre are doing already.

94%


Pricing Kids Games: Kids AppsTo be featured in the ‘Kids’ section, apps need to follow the Children’s Online Privacy Protection Act (COPPA) requirements. In addition they can’t use ads that ask kids to complete some sort of in-app activity, and they have to ask for parents’ permissions before they link outside the app to the web or other software, for the purpose of commerce.

There are separate areas for apps created by leading studios such as Disney, Toca Boca, Sesame Street, and PBS Kids.

The charts were based on data from this Kids section of the App Store. We wanted to find out if kids’ apps use monetisation strategies that are different to apps elsewhere in the store and which price points are the most successful.

Points to note:

• We reviewed the 50 highest grossing apps. We presume these are the ones that an app producer would want to imitate.

• It isn’t possible to estimate what percentage of their revenue has come from IAP or download fees.


International Pricing MatrixDue to the App Store being international and price points rarely being direct currency conversions we’ve supplied this useful matrix to with international currency comparisons.

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Tier UK US Canada Mexico AustraliaNew

ZelandJapan Euro China Singapore

Hong Kong

Russia IndiaSaudi Arabia

UAE

1 0.69 0.99 0.99 13.00 0.99 1.29 100 0.89 6 1.28 8.00 33 55 3.69 2.58

2 1.49 1.99 1.99 26.00 1.99 2.59 200 1.79 12 2.58 15.00 66 110 7.29 5.10

3 1.99 2.99 2.99 39.00 2.99 4.19 300 2.69 18 3.98 23.00 99 170 10.99 7.69

4 2.49 3.99 3.99 49.00 4.49 5.29 400 3.59 25 4.98 28.00 129 220 14.99 10.49

5 2.99 4.99 4.99 65.00 5.49 6.49 500 4.49 30 5.98 38.00 169 270 17.99 12.59

6 3.99 5.99 5.99 79.00 6.49 8.29 600 5.49 40 6.98 48.00 199 350 20.99 14.69

7 4.99 6.99 6.99 89.00 7.49 9.99 700 5.99 45 8.98 53.00 229 390 24.99 17.49

8 5.49 7.99 7.99 99.00 8.49 10.99 800 6.99 50 9.98 58.00 269 450 29.99 20.99

9 5.99 8.99 8.99 119.00 9.49 12.99 900 7.99 60 10.98 68.00 299 490 32.99 23.09

10 6.99 9.99 9.99 129.00 10.49 13.99 1000 8.99 68 12.98 78.00 329 550 36.99 25.89

Pricing of Kids' Games on the App Store

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