Every additional dollar spent on G5 and Glu Mobile advertising in 2017 brought companies an additional $4 in sales.
This data was shared by John Jordan, a freelance editor PocketGamer.biz . In the article “How Glu Mobile and G5 buy a lot of traffic and get bigger (but Rovio does not)“, he spoke about the successful growth of companies’ revenues after an increase in marketing spending.
John believes that “in a market where virality is falling and there are more and more problems with finding applications in stores, the main tools of competition are a good understanding of your product (especially the ability to evaluate its LTV) and access to large sums.”
As examples, he cites a Swedish company with Russian roots G5 Entertainment and Glu Mobile.
The G5 audience has tripled in four years, and sales have grown by 400%. In 2014, they amounted to $33 million. Today it is already $120 million. This happened against the background of a tenfold increase in the marketing budget (just to the level of $ 33 million). The stock price has also been rising all this time. Only in 2017, their valuation on the stock exchange rose by 200%.
The more G5 spends on buying users, the greater its income and earnings,” John concludes.
The situation with Glu Mobile is similar to the one described above. The more a company spends on advertising, the more its sales. Last year, its annual sales increased from $214 million to $300 million. Most of the money was brought by Design Home. The growth also occurred against the background of increased marketing costs.
John notes that increasing budgets is not a universal solution, only with the help of which you can “go far away”: “A mandatory requirement is the presence of the right games in the portfolio, which, in the case of G5 and Glu Mobile, were focused on the still underrepresented, but profitable segment – middle–aged women.”
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