According to recent reports observing the spending behavior of 37 million paying gamers (SuperData Research), the Latin American digital gaming industry is booming at an astounding $4.5 billion with projections of 16% growth year-over-year.
There has never been a better time to focus on Latin America as everyone is racing to get their foot in the door and grab a piece of the pie that is the digital games market. Latin America is also forecasted to grow to $5.3 billion in 2015 (SuperData Research). One reason for this is because of popular MOBA games such as League of Legends, which is currently the most popular game within Brazil. According to the research, the average lifetime value of any given gamer within Latin America equates to approximately $90.
Now with so many Latin American’s who are clearly excited about the digital games market, payments and billing become a huge factor. These gamers desire to pay for online digital goods in their favorite games but if they don’t have the proper methods to pay with, everyone loses out. Luckily, Xsolla partners with BoaCompra, one of the largest online games monetization companies in Latin America.
We recently spoke with Liz Goodno, Head of Global Communications at BoaCompra, to learn more about BoaCompra’s services, coverage, and uniqueness within the industry. In a very detailed and exceptional interview, Liz dives in-depth into topics including the local Latin American market, entering the region, and the gaming mentality of the locals.
Interview with BoaCompra:
1. First off, can you tell us a little about your company and the service you provide?
UOL BoaCompra is the digital payments arm of UOL, Latin America’s #1 media conglomerate. Here at BoaCompra, for the past decade we specialize in providing local payment methods for online games in emerging markets, such as Brazil, Central and South America, and Turkey, where the vast majority of the online population have severely restricted access to international credit cards, thus relying heavily on using their local payments when making purchases online. We also offer our own currency called GOLD, allowing gamers to play and pay for their favorite games using one simple wallet that they can top up online, or in one of 150,000 POS throughout the country. We currently service more than 3,000 + titles from 190 developers and publishers including VALVE, Electronic Arts, Riot Games, Smilegate, Bigpoint and more.
2. What made you choose Xsolla as a partner?
Our mission is to make gaming accessible, so players can play their favorite games available around the globe.
This is why we’re trying to always make it as easy as possible for publishers/developers to bring their products to Latin America and to integrate with BoaCompra services. For a while, we’ve been cooperating with different aggregators or technical solution providers and XSOLLA is one of the segment leaders, so we’re very excited to continue and expand our cooperation and allow XSOLLA clients’ to automatically benefit from our experience and coverage, without necessitating additional technical resources for the integration.
Our parent company UOL reaches 7 out of 10 Brazilian internet users, while UOL BoaCompra accounts for 65 percent of the online games market in Brazil and is overall market leader across Latin America.
4. What makes you different from other payment systems? Any unique features?
The key differentiator between us and other global payment systems in that we truly specialize in Latin America, and offer more payment methods just within this region than several world-wide payment providers offer globally. By providing the most comprehensive coverage and being a Brazilian-based company, our partners are able to achieve greater conversion throughout the region, while also tapping into our local expertise for guidance and support via marketing, public relations, customer support, Xfire e-sports hosting, server hosting and more. While at our core we are a payments company, we are specialized only in games, and our ecosystem of marketing, PR, channeling, and e-sports gives our partners a one-stop complete solution for bringing their titles into Latin America with the greatest success.
5. Can you tell us a little about the local market you work with?
With 40 MM+ gamers and an online games market expected to reach 1.4 billion this year, Brazil is one of the world’s fastest growing markets for PC F2P games, and boasts the largest and most profitable gaming audience in Latin America with the market expected to increase to more than $422 million in the next few years. Up until now this growth has been restricted by two factors; the cost of games and the country’s gaming infrastructure in terms of hardware specs and broadband speeds. In the case of the latter these are starting to catch up with Europe and the US, thanks in part to Brazil’s ambition to showcase the country in 2016. However, as the internet penetration rates in the markets we service continues to rise, consumers still don’t have access to international credit cards. In Brazil, this number is around 70 percent without international cards, and in some of the other countries we service, such as Colombia, as much as 90 percent of internet users can’t make purchases with international companies selling content online! For the past ten years, UOL BoaCompra has been working to provide the first Latin American e-wallet and payment solution for gamers, and a complete solution for game developers and publishers looking to bring their titles to the region.
6. Are there any legal/financial barriers or considerations publishers must face before entering your region?
While Latin America consists of 2 main languages (Spanish and Portuguese, with different nuances and dialects of course), there are 20 different countries covering the region, with huge differences on the macro (currencies, taxation, political systems, governments, legislation), but also micro scale (discretional income, preferred payment options, reach, purchasing behavior) even within individual countries. We generally help our partners to better understand the implications of each of these factors and how to best tackle them both individually as well as the entire region overall.
7. What is the gaming mentality of local people? How does this mentality influence their payment behavior?
Something very unique about Brazil is the common practice of installment payments. As credit cards are extremely prevalent in the United States, installment purchases are the norm in Brazil for high-priced goods. Nearly all Brazilians pay for their appliances, electronics, concert tickets, and more in monthly installments, and this is also true for digital content. As a gamer in Brazil, your decision on whether or not to purchase a high-priced value pack in your F2P game, or a bundle of titles on sale in STEAM, is directly influenced by their ability to pay in installments or not. While shopping on STEAM, a gamer is much more likely to purchase $200 on several titles on sale over the weekend, if they are able to pay off all those games monthly. Same goes for F2P gamers spending $300 on virtual currency during a promotion, these kind of payments are almost always made in installments. We recognized this need to make installment purchases possible in games, and offer installments on all of the titles we service, at no risk to our partners.