Why Online Gaming Is Thriving in Latin America
2020 has been a stressful year for most of us. From losing jobs to experiencing a downfall in business, it did not go very well. People opted for different activities and hobbies to stay sane during the period, one of which is gaming.
While many did not get enough time to stream games or play online, work-from-home allowed people to be gamers. An immense increase has been seen in downloading and operation of online gaming sites and streaming platforms in the past year, such as Steam Brazil. Some popular Brazil video games include Warzone Brazil, GTA Brazil, Assassin's creed Brazil, and Cyberpunk 2077 Brazil.
According to Statista, there were 2.7 billion gamers in 2020 globally. Other reports show 260 million out of them to be from Latin America. These gamers mostly belong to Mexico gaming, Brazil gaming, and Chile gaming other than South America game areas.
The gaming industry in Latin America has grown tremendously over the previous year. Mexico and Brazil were among the leading gaming markets in Latin America. Both the regions generated 3.65 billion US Dollars collectively. Esport Brazil is also becoming famous in the region.
Latin America Gaming Facts 2021
The growing number of gamers in Latin America has come out as a sound business opportunity for many developers and distributors. Numerous new Brazil video games have been developed to provide gamers with their choice of games to play.
• The top reason for Latin American people to opt for gaming has been leisure and entertainment. However, a large fraction of people who started playing online for entertainment has now moved to competitive gaming.
• As many offices have commenced onsite work, Latin American gamer's peak gaming hours are from 5 pm to 8 pm.
• Around 66% of the Latin American gamers play daily, with 44% spending at least one hour or more on their devices.
• An interesting fact about gaming is that from many people surveyed, 70% said that they believe mobile gaming offers a safe environment.
• 87% of surveyed gamers said that they select watching an ad overpaying money to earn lives.
• Warzone Brazil, GTA Brazil, Assassin's creed Brazil, and Cyberpunk 2077 Brazil are the most popular games in Brazil.
Why is Online Gaming Thriving in Latin America?
While numerous factors contribute to online gaming and streaming in Latin America, time in hand and the increased number of internet connections play a vital role.
Many people stayed at home the past year and had to get internet connections to work amidst the pandemic if they did not have previously. Only 22% of Latin Americans had access to the internet in 2008, rising to 56% in 2018. The internet connections have grown to 444M by 2021, with 422M unique mobile subscribers in the region.
Out of the total 444M internet users, 81% use it on the phone, contributing to a significant number of gamers who play on their mobile phones. Consoles have been seen as a more professional gaming approach. It is observed that 69% of gamers play on their smartphones while 48% use computers and 39% opt for consoles.
What Attracts Latin American Gamers?
The Mexico gaming industry and others have been growing in Latin America for the past few years but did not gain the same popularity. Other than the increased choices of games that allow everyone to play the genre they like, there are a few other reasons online gaming is hitting the jackpot in Latin America.
No Language Barrier
Online gaming involves a lot of communication with your teammates and opponents if you go for competitive gaming. People shied off from gaming online if they did not know English well. But now, they are moving towards online gaming due to more Portuguese and Spanish-speaking gamers.
Another reason for the lesser involvement of Latin Americans in online streaming and gaming was interest lack. A hike has been observed in the number of gamers from the region after Brazil video games like poker.
Offers and bonuses on different online gaming websites and platforms play a significant in retaining gamers as they can decide where to play and when.
Taxes on videogames and gaming accessories were reduced in Brazil
By the end of 2020, the Brazilian government announced a reduction of the tax on industrial products (IPI, in the acronym in Portuguese) on video game consoles, accessories, and games. According to the Ministry of Economy, the measure has an expected impact on revenue of BRL 2.7 million per month in 2021.
The Main Gaming Business Models
The gaming industry has not been the same since the beginning. Like other industrial sectors, it has also grown over the years and has come to the point that gamers previously would not have thought of. If you belong to the generation of kids who got to play arcade games, had you thought of playing games on your phone lying on your couch comfortably? Probably, not!
Let's take you on a ride of the evolution of gaming techniques and business models of Latin America, South America games, and other countries.
Past Gaming Business Models
The earliest generation of gamers belonged to the 70s and 80s when computers were not common and arcade games were popular. Kids and teenagers would go to the nearest arcade game place and buy coins to operate the arcade games. While the arcade games took a lot of space, the one-time investment paid off fairly well. Namco's Pacman generated a hefty $3.5 billion in 1990 through the "Pay to Play" business model.
Another prevalent business model following arcade games was game CDs. By the late 80s and early 90s, computers could be seen in a few homes giving rise to PC games. Games were available at CD shops where gamers could get their favorite game by purchasing a CD and running it on the computer. Mostly, each CD would contain only one game. You would need a new CD if they wanted to play a different game. This kind of sale model would generate only one-time revenue, called the "Boxed revenue Model."
Present Gaming Business Models
The gaming generation did not jump from the very early PC games to Play Station 5 instantly. Various kinds of business models like e-sport Brazil and games were introduced throughout this period. From various game CDs in the early 2000s to playing Super Mario on the computer and moving to GTA Vice City on the same desktop, it has been a roller coaster ride. Each new game excites gamers as never before!
The present era is the Digital Sales Business Model generation, where you can find everything on the internet. Hundreds and millions of games can be found on the internet, Google Playstore, and Appstore for people of all ages and choices. The direct distribution of games has contributed to reducing the retail part and packaging costs.
You can estimate how digital sales revolutionized the markets through statistics shared by Statista. Reports show that only 20% of gamers downloaded games on their PC online in 2009, and this number skyrocketed to 83% in 2018. This is the power of digitalization!
Fig 1. Physical vs Digital Gaming
Many developers have come up with creative strategies to make the best out of their skills and designed games. Distributors now monetize players through different elements like offering extras and DLCs. Among many games, Warzone Brazil, GTA Brazil, Assassin's creed Brazil, and Cyberpunk 2077 Brazil also operate on the same business model.
Gaming consoles are equally popular among gamers in today's time as PCs. While a large fraction of gamers prefer PCs for a more convenient gaming experience, many like consoles to get the best gaming experience.
Gaming consoles and downloadable Brazil video games, and others (PC & Mobile phone) follow a free-to-play model with integrated microtransactions. They allow you to download a game from Playstore without a fee. But you need to pay to buy lives or extra elements needed to move to the next level. All of them are quite popular in Mexico gaming, Chile gaming, and Brazil gaming.
Future Gaming Business Models
Many of us use Netflix and find it immensely convenient to have all movies and TV shows on one platform by paying a subscription fee monthly. If you're wondering why we are talking about Netflix here, let me explain.
Even though the retails packaging charges have been excluded due to digital distribution, others eventually make it expensive. Now, developers and distributors are working on a model similar to Netflix where you would be able to find all games and esport Brazil under one roof. What can be better than having all games on one platform without paying for each of them separately!
Online gaming usually comes with uninvited advertisements amidst games that we find annoying. However, in the future, AI will play a major role in regulating the advertisements to be shown on cloud-based games.
Consoles vs. PC vs. Mobile Gaming
The Consoles vs. PC rivalry wasn't enough to divide gamers into groups that mobile gamers have also jumped into the bus.
Whether mobile gamers entered by their choice or dragged by others, the debate has become Consoles vs. PC vs. Mobile. All three kinds of gamers play in Latin America and believe that their gaming method is the right one only. If you are looking to buy one of these devices and are confused about the final decision, these might help!
While we say that the earliest games were arcade games, consoles existed in one form or the other. It is said that Magnavox Odyssey was the first ever console to be introduced into the market in 1972. Magnavox Odyssey wasn't exactly a console like the new generation, but you could play games at home through the system.
Consoles were particularly designed for gamers to enjoy convenient and comfortable gaming at home. With advancements in technology, we now have the PS5, loved by thousands globally. These little boxes have a whole world in them. PS2 by SONY has over 380 titles – the highest number in console history!
• Do not cost as much as high-end computers
• Don't need in-depth technical knowledge
• Not as powerful as high-end PCs
• Lesser discounts on games
PC gaming is among the oldest in the market and holds a different place among gamers. If you belong to an older generation, we understand why you prefer PC gaming over others.
While the consoles and mobile phones of a particular model are designed monotonously, you can customize your unique PC. The addition of extraordinary features costs a little high, but you can get a pretty good PC customized in your available budget.
• Better game discounts
• Multiple uses
• Cannot access console-specific games
Mobile phone gaming has grown drastically in the past year, with a large number of people moving towards mobile gaming. Ministry of Culture Argentina says that 60% of new smartphone users prefer playing games on smartphones. The number of mobile gamers surpassed 3.5 billion globally in 2020.
Fig 2. Global Games Report
With responsive gaming websites and interfaces, the gaming experience is a lot more immersive in mobile gaming.
• Cheap games
• Not the same visual experience as PC or Console
How to Provide the Best Experience for the LatAm Gaming community?
The growing gaming industry in Latin America is open to better options that offer more value for money. If you are willing to become a part of the Mexican gaming industry, remember that keeping your customers happy is the first rule of business. Have a look at the following tips to ensure that the gamers love the game developed or distributed by you.
While many people put it last, we believe that customer satisfaction should be the top-most priority.
Ken Blanchard once said, "Just having satisfied customers isn't good enough anymore. If you really want a booming business, you have to create raving fans."
Especially in the gaming industry, your game can instantly become popular among gamers if a few start liking it. Talk to the gamers when they face an issue and try to resolve it as soon as possible. A delay in action to a complaint can cause a group of gamers to move to another. Being a part of the Latin American gaming frame, customer service in Spanish, Portuguese, and other local languages should also be accessible.
Making payments convenient for the gamers should be among the vitals on your list. Ask yourself a simple question if you would prefer easy payment methods or complicated ones? That's the answer. Everyone looks for handy payment options that they can avail themselves of at one click.
You cannot sell games the same way you would sell a pack of chips. The consumers come from different places with different mindsets, and you must know how to attract them. Use relevant social mediums to interest your potential customers. YouTube is a popular social media advertisement medium nowadays. Moreover, you can also look for gaming sites that allow other developers to present games.
The Most Played Games in Latin America
Preguntados is unarguably the most popular game in Latin America, especially Argentina and Mexico gaming zones. It is not a creative game rather an intellectual one with two people asking each other questions. Either you can play with your choice of people or compete with people over the internet. The quiz is divided into 6 categories, Arts, Science, History, Geography, entertainment, and sports.
Preguntados was introduced in late 2013 by Etermax, having versions available on Windows phones, Appstore, and Playstore. It the most downloaded application in today's time, with over 20 million downloads globally. In the early days of introducing the game, it reached 180,000 downloads in the Latin American Region and South America game.
Rock of Ages
The Chilean company Team Ace knew well what they were doing while they created and introduced Rock of Ages to the gaming fraternity. The game was presented to the market in 2011 for Windows, Xbox, and PlayStation. The game is based on ball-game dynamics and defense strategies by building towers to protect yourself.
The game is highly rated at Steam Brazil with over 1500 comments due to its graphics, user interface, and sound quality. Rock of Ages is not the only popular game by Team Ace. The first game by the developers, Zeno Clash, gained immense popularity after its release in 2009.
League of Legends
Brazil is the gold mine of video games as they produce and play a high number of games. 1700 games were produced in Brazil alone in 2017. A study by Abragames shows that the number of games has doubled from 2014 to 2019 in Brazil.
League of Legends is among the most popular games in the Latin American region, particularly in Brazil and Chile. The game was introduced by Rio Games in 2009 and was downloaded quickly by many gamers. League of Legends (LoL) is based on two teams of 5 teammates competing to complete tasks. More than 800 professional LoL players play globally in over 100 teams.
Games Trends to Watch in 2021 in Latin America
Looking at these trends will let you know how gaming has been doing in the past year and how you can grow in the industry this year. Keeping up with the trends can be immensely helpful for you to get the best out of time.
More 5-G Connections
It is expected that the number of 5-G connections will increase this year, providing better internet speed to gamers. The number is projected at 700 million+ in 2021, reaching 2.1 billion by 2023.
Game Distribution Dynamics
Individual games, companies, and distributors will continue to impact the face of mobile game distribution globally.
Increased Console Demand
Mobile phones are available readily worldwide, and almost all smartphones are game-compatible. However, every few months, new consoles in limited quantities are introduced in the market. With the increasing demand for gaming consoles, companies need to improve the productivity to match the supply to demand.
Flourishing Gaming Industry
The growth trend of gamers in the past few months exhibits that the number will increase even more in the coming years. The gaming market is projected to generate revenue worth $189.3 billion this year.
Fig 3. Streaming hours
The growth patterns of people using gaming and streaming platforms like Steam Brazil, Twitch, Facebook Gaming, and YouTube Gaming show that we can expect a further increase in the number of gamers. With the current pace, the gaming market in Latin America is expected to reach $3.6 billion in revenue by 2023.
The gaming industry, including Mexico gaming, Brazil gaming, Chile gaming and, Argentina gaming markets with games like Warzone Brazil, GTA Brazil, Assassin's creed Brazil, and Cyberpunk 2077 Brazil is thriving in Latin America. You can make the best use of the current gaming business dynamics in Latin America to expand your business. Keep up with the recent trends of the industry and drive effective marketing strategies for a successful business.
What are the key factors you should know in expanding and growing a business in Latin America? Each week we’ll unlock a new content guides to help you navigate the market and localize in the region.