The Chinese Games Market

I have just completed my in depth analysis on the Chinese Video Games Market and at the base of this article you will find the presentation on slideshare. It covers the current market and forecast, key demographics, cultural considerations and video games marketing needs for the country.

The Chinese video games market in 2012 was estimated to be worth $9.7 billion an increase of over 35% from the previous year. The vast majority of this ($9.1 billion) being from online games with rest mainly made up from the mobile market which, although rapidly expanding has yet to truly explode. In a report by Techweb it was estimated that the total revenue of China would top $21 billion by 2017 presuming that growth continued at approx. 12%. To put this in perspective in 2011 Americans spent nearly $25 billion on video games, including hardware.

Given the until recent lack of consoles and high rates of piracy its little wonder that the bulk of growth and revenue to date has come from digital and specifically MMOs, free-to play titles and social games. MMO’s are still king with 67% of all revenue coming from this category. The Market itself is dominated by local and regional players such as Tencent and NetEase but many more are coming through thanks to the markets size, growth and robustness. Mobile is still a small but rapidly expanding segment and should be expected to take significant market share over the next few years.

Investment interest in the game industry is high with Free-to-play MMO company Suzhou Snail Electronics Co Ltd (also known as Snail Game), which employs over 3,000 people, recently organised investment with four banks for a loan on $100M for one game alone.

Top 6 Chinese Game Companies

In Q1 of 2013 the six largest game companies in China grossed over $2 billion or RMB 12.8 billion.

Key Data Points on The Chinese Video Games Market

  • The Chinese Video Games market is huge and could be worth over $20 Billion by 2017
  • The country itself is equally vast and regions should be considered as individual country size markets similar to the EU.
  • Free to play and VIP access are the only models that consistently appeal to Chinese gamers and make significant revenue. Games that introduce PvP elements often see higher ARPU’s.
  • MMO’s currently hold around 67% of the market but web and social games becoming increasingly popular.
  • The vast majority on the online population consider themselves Gamers.
  • Chinese gamers are highly sociable online and heavy users of IM, Social Networks and Blogs. However these are local service such as QQ with a relatively small % of people using Facebook and Twitter being blocked.
  • Baidu is the dominant search engine and advertising platform. Tencent is the dominant Social and Chat provider.
  • Mobile game development has been a challenge but is now set to see rapid growth and investment over the next few years.
  • Doing business in China can be difficult not only for numerous cultural differences but also heavy government regulation.

Below I have created a presentation that walks you through the Chinese market, its demographics and marketing opportunities in full.

China Video Games Market & Marketing 

One comment

  1. The gaming industry in China is starting to pick up. Would love to see more Chinese developed games in the future.

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