THE BLOG
24/09/2013 07:18 BST | Updated 23/11/2013 05:12 GMT

Local Preferences Determine Video Gaming Purchase Habits

In order to make the most of the revenue opportunity and technological advances, the industry has had to develop an incredible pace. In many cases, this has made it challenging for merchants to keep up while simultaneously giving customers a seamless online purchasing experience.

The video gaming industry has grown exponentially since the 1970s to become a $70 billion market . US consumers alone spent $1.59 billion on digital games content (including full game downloads, add-ons, subscriptions, mobile games and social network games) during the first quarter of 2013, according to research from The NPD Group . In order to make the most of the revenue opportunity and technological advances, the industry has had to develop an incredible pace. In many cases, this has made it challenging for merchants to keep up while simultaneously giving customers a seamless online purchasing experience.

The Video Games Payment Preferences whitepaper (based on WorldPay's The Download on Digital report) has identified the various online purchasing habits, preferences, experiences and frustrations associated with the buying of video gaming content amongst 7,554 consumers.

The research found stark differences in local preferences for video game content. Video gaming apps emerged to be the number one purchased globally (49%) with games purchased and played online featuring second (40%). Regionally, however, these statistics differ. For example, in the UK, console games proved to be the most popular (26%) and in China, massively multiplayer online (MMO) gaming was found to be the most popular gaming type (45%).

Looking at app store and console games in particular, one-off purchases are popular. In contrast, massively multiplayer online (MMO) subscriptions, such as World of Warcraft (30%) and console-related games content (24%), peak the list for subscription-based purchases.

In addition to the local preferences for content type, the research also found local payment preferences are central to the video gaming experience. In general, credit and debit cards remain widely used (47%), while alternative payment methods (such as e-wallets) are now used for 51% of video gaming purchases worldwide. In particular, WorldPay found that e-wallet payments are on the rise and used extensively in Russia and China as a payment method. The use of e-wallets is particularly popular for video game content purchased online, including modifications and expansions.

The choice of payment method used is largely reliant on the factor of convenience, with 72% wishing to save payment details for quicker future purchases, and 80% preferring to use the same payment method for purchasing all types of content.

The choice of payment method is also reliant on security expectations. A primary concern for video gamers is the protection of personal payment details, as well as the safety of the consumer's personal information in the hands of merchants. In relation to specific payment types, 35% of respondents said they were very concerned about payment security when using a credit card while only 26% were very concerned when using e-wallets.

Payment frustrations are also found to be an integral part of the customer experience. The top frustrations vary by country with 50% of respondents in Brazil citing the number one payment frustration as encountering additional and unexpected fees when paying online. Meanwhile, most consumers globally (35%) think that encountering additional fees at the checkout respondents is most frustrating. If a consumer faces any issues during the payment process they are likely to deem the purchase as not worthwhile and abandon it.

The research suggests that video game operators must seek to offer consumers a wide range of payment options, and ensure that consumers don't encounter hidden surprises during the transaction process. Being 'frictionless' is very much the key. In terms of long term development, considering alternative payment combined with more traditional methods of payment is increasingly important as the market moves towards a multi-platform, multi-device and multi-payment world. In an increasingly competitive and complex industry, video game operators that can deliver content conveniently and at fair prices give themselves the best formula for success.