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How Does Pokémon GO Make Money (Business and Revenue Model)

The Pokémon GO business model

How Does Pokémon GO Make Money?
Here’s what you should know:
  • What is Pokémon GO, and how does Pokémon GO work?
  • How does Pokémon GO make money?
  • Sale of PokéCoins (Pokémon GO’s in-game currency)
  • In-game Advertising
  • Selling Merchandise
  • Pokémon GO’s profit and revenue
  • What is the Pokémon GO business and revenue model?
  • Pokémon GO’s funding and valuation

How does Pokémon GO make money if it’s free to play? Here is a full, in depth, breakdown of their three (3) revenue streams and the different products and services they offer, as well as the Pokémon GO business model, their year over year revenue, and how Pokémon GO works.

What is Pokémon GO, and how does Pokémon GO work?

Pokémon GO is an augmented reality (AR), free to play (F2P), mobile game where players can find, catch, train, and battle Pokémon visually in the player’s real world location.

Developed and released in 2016 by Niantic; in collaboration with Nintendo and The Pokémon Company. Pokémon GO has since been downloaded over 1 billion times and grossed more than $6 billion in revenue since its release, making it one of the most downloaded and profitable gaming apps of all time.

How Pokémon GO works is: To play Pokémon GO, players must first download the game via the App Store, Google Play, or Galaxy Store.

Once downloaded, players need to allow the app access their location by turning on the GPS tracking. Then, players can begin playing by finding, catching, training, and battling Pokémon. As well as having the option to purchase premium items, upgrades, and more in the Pokémon GO Shop of the app.

Some of Pokémon GO’s competitors include Fortnite, Roblox, Minecraft, and other popular video games.

Pokémon GO App in Apple App Store | Pokémon GO Business Model | How Does Pokémon GO Make Money? | How Does Pokémon GO Work?
Source: Apple App Store | Pokémon GO

How does Pokémon GO make money?

Pokémon GO has been downloaded over 1 billion times since its 2016 release. Leading to more than 71 million players in 2021 alone.

So how does Pokémon GO make money off of all these app downloads and players?

Below is how much money Pokémon GO makes and its revenue model. Including all revenue streams and how much they charge for their services.

Here are the 3 ways of how Pokémon GO makes money (in 2022):

Pokémon GO has a revenue model that makes money in three (3) ways – the sale of PokéCoins (Pokémon GO’s in game currency), in-game advertising, and selling merchandise.

#1. Sale of PokéCoins (Pokémon GO’s in-game currency)

Pokémon GO makes money through the sale of PokéCoins on the Pokémon GO platform.

What are PokéCoins? PokéCoins are Pokémon GO’s in-game currency that allows users to purchase and use this currency to buy things like premium items and or upgrades in the Pokémon Go Shop.

PokéCoins can only be purchased in game. You can see how much PokéCoins cost below.

What is the price of PokéCoins?

  • $0.99 to $99.99 depending on the quantity of PokéCoins purchased
What is the price of PokéCoins? | Pokémon GO Business Model | How Does Pokémon GO Make Money? | How Does Pokémon GO Work?
Source: Pokémon GO

#2. In-game Advertising

Pokémon GO also makes money through its in-game advertising, augmented reality style.

While Niantic does not release specifics on how much advertising with Pokémon GO costs, a 2017 article by TechCrunch revealed partnering sponsor’s, like McDonald’s, pay up to $0.50 per store visit. Which is possible to be much higher now.

Note: Niantic uses a cost per visit (CPV) ad model. Meaning, advertisers only pay when a user goes into the advertised store.

#3. Selling Merchandise

In addition to virtual sales and ad revenue, Pokémon GO also sells its own merchandise through its official online store Pokémon Center.

Here, they sell branded Pokémon GO toys, collectibles, apparel, and more that range in price from $12.99 to $54.99.

Pokémon GO’s profit and revenue

In 2021, Pokémon GO reported $1.21 billion in revenue.

Note: Because Niantic Inc, the developer of Pokémon GO, is a privately held company, they are not required to make their annual reporting, such as Form 10-K’s, pubic.

What is the Pokémon GO business and revenue model?

Pokémon GO makes money through a few revenue models that they combine within their company, they are:

  • Gaming as a Service (GaaS) business model
  • Free to play (F2P) business model
  • Transaction based revenue model
  • Advertising based business model
  • Licensing business model
  • B2B2C (partnerships) business model

Pokémon GO’s funding and valuation

According to Niantic’s Crunchbase profile, Niantic, the developer of Pokémon GO, has raised $770 million over 5 rounds giving them a post-money valuation in the range of $1 billion to $10 billion as of November 23, 2021.

It’s unclear how much of those funds raised went to Pokémon GO and the development of Pokémon GO, as well as how much Pokémon GO is valued at by itself.