Nintendo’s Super Mario Run was December’s hottest mobile game release. The high-level stats looked great, reviews were very positive, and the business press has been positively giddy.
The headline stats look great. Since its December 15th launch, Think Gaming estimates that Super Mario Run earned roughly $36MM in gross revenue on ~80MM installs since launch. It spent 1 month as the top free iPhone game in the U.S. And, it remains in the top 10 as of February 2, 2017.
But Super Mario Run started with two unique benefits: top tier IP (the Super Mario Franchise) and unprecedented promotion from the App Store. Remember Apple’s September 2016 event? Nintendo’s Super Mario creator Shigeru Miyamoto took the stage to announce Super Mario Run after Tim Cook’s company update? This was followed by the first-ever pre-registration promotion, and the app was featured extensively after launch.
Real success as a top grossing mobile game means a high lifetime value (LTV). That basically breaks down into two questions:
- Is the game sticky?
- Does it drive players to open up their pocketbooks?
Super Mario Run only spent 1 week as top grossing game and is currently hovering around #60 on Think Gaming’s charts. Generally, games in the top 50 grossing games make at least $5.00 in 1-year customer lifetime value. Our current estimate of the LTV of a Super Mario Run player is quite low: $1.18.
What went wrong? Retention looks fairly good, so it’s a sticky game. And the conversion rate of 4.5% to the $10 paid offering is in line with other well monetizing games. The big problem? Nintendo capped their revenue per user with a single $10 in-app purchase. Games like Pokémon Go, Game of War, and Clash Royale make much more money from their super fans (aka their whales).
Compare Super Mario Run performance to this summer’s hit Pokémon GO. During the 7 weeks immediately following launch, Pokémon GO earned $100MM in revenue and had 45MM installs with 9.4MM Daily Active Users. One of the most successful mobile launches ever. And it has proven to have staying power.
Just since Super Mario Run launched (December 15 to February 2), Pokémon GO earned nearly $30MM in revenue — 1.5x what Super Mario Run has earned. And this isn’t just the case of having a larger base of players from which to earn. The LTV of a Pokémon GO player is dramatically higher.
From Think Gaming’s perspective Super Mario Run is not the hit Nintendo wanted or needed. If we were in Nintendo’s shoes, we’d evaluate whether the Action genre was the correct genre to pursue with IP as valuable as the Super Mario franchise. The Action genre accounts for 12.4% of U.S. iPhone game installs BUT only 3.6% of revenue. This simply isn’t the type of game that drives tremendous in-app purchases.
We’re keeping a close eye on Nintendo’s new iPhone release Fire Emblem Heroes to see how well it performs and whether it can be a meaningful driver of in-app purchases.