There’s a huge potential for advertisers with Pokémon Go. It’s hard to tell the exact number of active users at this point, but the game has in just a week become a cultural phenomenon.
Pokémon Go was first available in the U.S., Australia and New Zealand. According to SimilarWeb, 5.9% of all U.S. Android users opened the app just a week later its initial release on 6 July. The game became available in the UK on 13 July on Android devices and on 14 July to iOS users.
Some play small, others play big - soon, marketers will be able to target their audience through sponsored locations within the mobile game. Niantic, the game's developer and a spin off of Google, said earlier in the week that it would offer advertisers sponsored locations down the road, a move that will especially appeal to retailers, but hardly any specific details were given so far.
Niantic CEO, John Hanke told the Financial Times that Pokemon's first component to its business is in-app purchases, alongside in-app payments: "there is a second component to our business model at Niantic, which is this concept of sponsored locations", Mr Hanke said, where companies "pay us to be locations within the virtual game board — the premise being that it is an inducement that drives foot traffic".
Advertisers are charged on a "cost per visit" basis, similar to the "cost per click" used in Google's search advertising, he added.
Mr. Hanke didn't provide much additional detail, and it wasn't clear when the sponsored locations would arrive.
Pokémon Go is free to download but Niantic makes money by in-app purchases, which can help players advance in the game more quickly. For sale separately is a wearable that alerts people to nearby Pokemon, even when they're not actively playing on their phones.
By all accounts, the game has been very lucrative. Through rough estimates, it has made well over $1 million in net revenue per day, after developers' 30% cut to Apple and Google. For Nintendo, one of the major investors, the game has sent its shares soaring about 50%.
Whether game players will respond well to sponsored locations like "Pokéstops" and "gyms," which are real-world places where players can spot and train Pokémon characters, is a matter in hand.
Many retailers and local businesses have already came up with ideas how to use the game to attract people to their stores using "lures," which can be bought in the game to allure Pokémon characters to specific locations. The more Pokémon there are hanging around a Pokéstop or gym, the more likely there are to be players nearby.
What big marketers might jump in first isn't clear, but they will definitely develop their own strategies to attract consumers.