Q&A: The Japanese Mobile Games Market…What’s Unique, and How to Approach Localizing

One of the things that fascinates me about mobile game consumption is how it can differ from country to country, depending on any number of local factors, including market size, consumer tastes, and even politics. We sat down with Josh Burns, a consultant who has extensive experience collaborating with leading mobile gaming companies including Zynga, Ludia, and many other game studios, helping them to make strategic forays into Asian markets. Our topic was the mobile gaming industry in Japan, specifically what makes it so wildly different from many other markets, and what it takes to crack it if you’re a western game publisher.

What exactly makes the Japanese mobile gaming market so interesting?

Josh Burns

First of all, the sheer opportunity: comparing populations, Japan’s is less than half (40 percent) that of the U.S., yet its mobile gaming market is as large as ours. Then there’s the fact that among Japanese users, revenue per download is incredibly high: a few years ago the average revenue per download in Japan was over $5 for an app of any category (game or non-game), and it’s likely only risen since then. Some of the top grossing games in the world are in Japan, like Puzzle & Dragons and Monster Strike, and they generate the majority of their revenue just from the Japanese market. In Japan, mobile game devs are willing to pay an insane amount on both installs (sometimes $10-$20 per install) and potentially millions of dollars on non-mobile traditional advertising (like TV or billboards). New mobile games often launch with television ad campaigns and other advertising leading up to the launch.

Mobile gaming is just very different in Japan. Because users consume games so avidly, every game has to have a lot of content and/or levels or players will “finish” it and leave forever. Also, in Japan, customer service for mobile games is very high touch, with many companies offering phone support and online communities, which is quite different from the way it is in North America.

Are there cultural reasons why mobile games are so successful there?

It’s partly because the Japanese were way ahead of the US in terms of the mobile internet in general — in fact, it started way back in 1999 with Docomo, which launched the mobile subscription model via i-Mode. Basically, Japanese users became accustomed to purchasing virtual items in games on mobile long before Americans did, when feature phones were the only option. So now they spend more time and money on their phones simply because it’s been the norm for so long. Then there’s also the fact that in Japan, commutes are long, and typically on trains. In Tokyo, a typical commute is about an hour each way. Commuting by train is such a cultural norm that many mobile games are designed to be played with one hand so you can play and still hold on.

If you’re interested in localizing your game in Japan, what are the particular challenges you need to be aware of?

There are a lot of factors that can make the Japanese mobile market a challenge. First off, of course, is language — games have to be localized to have a chance. Similarly, the Japanese have very distinctive taste: take a moment and poke around in the top-grossing Japanese games and you’ll see that they have a certain look and feel. The small market is dominated by local companies, which makes it hyper-competitive, and users tend to be very loyal to their games, so it can be tough to get them to try new ones. Plus, the high CPIs and marketing spend are just not something that western game companies are used to. In the end, Japan is the second biggest market in Asia for mobile gaming, but it’s also the most challenging.

So given how competitive the Japanese market is, if a developer is interested in making a foray into it, what do you recommend?

When it comes to Japan, all is certainly not lost because it’s so competitive, and there is a series of steps you can take to gradually capture local revenue. I think of it as a ladder that goes like this:

1. Localized app store materials.
2. Localized in-game text.

Remember that Japanese players demand high quality localization, so make sure the translations are reviewed by native speakers. With your app store materials, make sure they’re appealing to local users. (For an idea of how customized they need to be, check out Game of War in the US vs. JP.)

Intermediate steps:

1. Local support and operations, i.e. community managers and customer service staff that are native speakers and can build and maintain online communities.
2. Local marketing activities, ad networks with a local presence, local cross-promotional networks like Noah Pass from Sega, and if you are more bullish, local TV advertising.
3. Unique, local, in-game content, such as new characters with a manga look, which will appeal to local users.

Expert steps:

1. Adjusted monetization strategy (for example a Gacha system, which is similar conceptually to users purchasing a grab bag versus being able to purchase the content they want directly, as well as Gacha-related in-game events ideally several times a month in which new content is introduced to the game.)
2. Custom version of game for local markets, potentially licensing local IP that would be more appealing to local users for creating a slightly modified version of your game, although most top IPs in Japan have local studios building content around them, so this isn’t an option for 99.9% of western companies.

Western developers of all sizes should be realistic about the smaller opportunity for their games in Japan. However due to high monetization in the Japanese market, it can definitely be worth following these steps to set your game up for success and maximize revenues from the audience you will acquire.

This is the first in a series of interviews covering foreign markets and localization.