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Consumers becoming increasingly comfortable buying digital goods via mobile

Mobile payments for digital goods is a growing trend, with gaming sites and social networks creating huge demand for user-friendly purchase mechanisms.

VGMarket, a market research firm specializing in the video game industry, and PlaySpan, which specializes in monetization services for online games, virtual worlds, social networks and videos, collaborated on the 2010 Digital Goods Report that reveals consumer behavior patterns among existing customers of third-party and first-party online game marketplaces.

“The key finding of the report is that, although males are playing significantly more games and are the primary drivers of total digital goods sales, the data shows that North American women 25 and older are spending disproportionately large sums of money on digital goods,” said Michael Gluck, president of VGMarket, Hollywood, FL.

VGMarket provides online surveys, play testing, concept testing and focus group research for publishers such as EA, 2K, SCEA, SOE, Capcom, Ubisoft, Namco Bandai Games, Spin Master, PlaySpan, Intel, ngmoco and Zynga. 

PlaySpan claims that its patent-pending in-game digital goods commerce and micropayment platform, UltimatePay, enables game publishers and developers to generate new revenues, acquire new users and extend the loyalty of existing users.

Social network games drive revenue
The PlaySpan/VGMarket study quantifies digital goods purchasing behavior at the genre and item levels and also provides statistics on first-party purchasing directly from publishers and third-party purchasing through online marketplaces, and those who sell digital goods directly to other players.

While payment mechanisms vary, from credit or debit cards to wireless carrier billing, various forms of mobile payments are increasing in popularity due to the ease-of-use factor, as well as the ubiquity of mobile devices.

Comparing information from first-party sites, social networks lead the way with the median spent on digital goods coming in at $50 per year.

This was followed by massively multiplayer online (MMO) games at $40, casual games at $40, free to play games at $40, PC games with online play at $37 and console games with online play at $20.

Also worth noting is that overall 32 percent of respondents made purchases within social networks.

The report also found that while males are the primary drivers of total digital goods sales, North American women 25 and older spend significantly more per person.

When looking at the median spent on first-party purchases within social network games, the average female spent $55 dollars, compared to only $30 for males.

Females also spent twice as much—$50 compared to $25—when comparing purchases of in-game currency and the median overall expenditure was higher for females than males, at $80 to $60 respectively.

Mr. Gluck said that the report demonstrates a number of significant trends and monetization opportunities available to both first-party publishers and third-party marketplaces through the sale of digital goods.

Each type of digital good has a unique level of demand, and the amount of money that a consumer spends on digital goods continues to vary widely by genre, according to the report.

The VGMarket survey was comprised of responses from a sampling of 2,221 customers between the ages of 13 and 64 across the PlaySpan Marketplace, Facebook via Spare Change and Ultimate Game Card.

“The most surprising finding of the report is that 59 percent of respondents have purchased digital goods from third-party sources,” Mr. Gluck said.

“This demonstrates the tremendous monetization opportunity that publishers have in partnering with companies like PlaySpan to sell digital goods,” he said.

Final Take
Dan Butcher, associate editor, Mobile Commerce Daily