A few weeks into its launch, Pokemon GO has already surpassed all expectations in terms of revenue generation and its impact on Nintendo stock prices. Recently, however, the company added another significant revenue stream by announcing its collaboration with McDonalds in Japan, kickstarting a type of collaboration that already has other companies and chains clamouring to join in.
The game was reportedly earning $1.7 million a day from US-based Apple devices alone, a figure that is certain to have increased with time and the inclusion of new countries. Nintendo’s value already doubled since the release of the game, though this was followed by a swift nosedive when the company clarified that its own earnings were limited. Apart from its own success, the game has also positively affected the economy in several indirect ways.
Vendors in places like Santa Monica Pier in the US, which sees thousands of gamers roaming around simultaneously, have seen a huge increase in their sales, as have bars, cafes and restaurants which happen to be situated within range of a Pokestop or gym. Certain establishments have even begun purchasing “lures” to attract Pokemon, and thereby trainers, to their area to gain more business. Notices such as “Pokemon for paying customers only” have already started cropping up. Bicycle rental companies have also shared in this success, with thousands of players renting for hours together to scour their neighbourhood.
Prominent Youtubers around the globe, such as Philip DeFranco and Furious Pete, are also taking advantage of the trend by promoting Pokemon-based merchandise on their channels, leading to considerable profits for all the parties involved.
The developers are clearly taking advantage of their effect on physical locations, though they remain vague on precise details. The potential benefits for their partners could include each branch acting as a PokeStop, a gym, perhaps even acting as exclusive zones where certain rare Pokemon spawn regularly. This is generally seen as good news by Pokemon GO players.
People who encouraged the game on the basis of physical exercise might have to reevaluate, as the health benefits of sitting in McDonalds for hours over fries and sodas to catch Pokemon or stock up on items are rather questionable.
The kind of advertising in question here is radically different from the more traditional forms of advertisements which typically sell a brand or a product. The power to bring players to the physical location of the outlet(s) in question is far more attractive for certain sectors, such as the food sector, as well as specialised gaming and merchandise stores. Nintendo outlets, for example, would certainly see a considerable rise in sales with this kind of incentive-based advertising.
The establishment of such a promising revenue model – not just for Pokemon GO, but potentially all augmented reality games – will encourage more developers to take interest in the budding field. Hopefully, it will also encourage developers and lawmakers to take a real interest in making sure people don’t sideswipe police cars to catch a pokemon or barge into Rashtrapathi Bhavan to take over a gym.