Huayuan Securities: The transformation of mini-games to boutique products suggests grasping the mature volume of the ecosystem

The Zhitong Finance App learned that Huayuan Securities released a research report saying that mini-games are transforming from fragmented recreation to medium to heavy and boutique games. According to Gamma data, the total revenue of the Chinese mini game market reached 39.836 billion yuan in 2024, an increase of 99.18% over the previous year. According to DataEye, the total revenue of the Chinese mini game market is expected to exceed 60 billion yuan in 2025. Minigames have gradually grown from fragmented pastime to medium to heavy and boutique games. The increasingly prosperous content ecosystem is a rare incremental space for the game market. At the moment, the bank recommends grasping the mature volume of the ecology.

The main views of Huayuan Securities are as follows:

Starting with “Battle of Planes”, ten years have witnessed the transformation of mini-games from fragmentation to medium to heavy and boutique games

“Battle of Planes” was an early WeChat game. At this time, mobile phones became popular, and the WeChat ecosystem began to drive the rise of lightweight games. In 2022, the WeChat Mini Game Creative Encouragement Program was upgraded, commercialization efficiency was improved, a large number of high-quality mini games appeared, and products developed into boutique products. In April 2024, the SLG game “Endless Winter” under Diandian Interactive surpassed “Seek Daecheon” and reached the top of the WeChat Mini Game Bestseller list. According to Gamma data, the total revenue of the Chinese mini game market reached 39.836 billion yuan in 2024, an increase of 99.18% over the previous year. According to DataEye, the total revenue of the Chinese mini game market is expected to exceed 60 billion yuan in 2025.

Under ecological prosperity, the game market has rare room for growth

1) Platform/user side: WeChat + applet traffic bonus. As an important carrier of WeChat traffic, WeChat applets increased 3% year on year to 949 million in October 2024, and the number of monthly active users increased by 27.84 million year on year. According to QuestMobile data, judging from October data from 2022 to 2024, WeChat games continued to be the type of application that occupied the highest share of user time. In October 2024, the number of monthly active users of WeChat games reached 555 million, an increase of 5.9% over the previous year. 2) Channel/Monetization Model: More flexible and higher quality. WeChat has introduced a series of incentive policies. WeChat mini games can enjoy different additional incentives at different stages, and the estimated revenue received ranges from 50% to 100% or more. 3) R&D side: faster cycle and turnaround. Currently, manufacturers have mature technical capabilities to support development for both split end native production and production compatible with the H5 version. Even for natively produced mini-games, the development cycle and cost can be reduced to at least 50% of mobile game apps. In addition, Unity provided special support and optimization for WeChat games. WeChat launched a Unity WebGL mini game adaptation (conversion) program to reduce the development cost of converting Unity games to WeChat games.

Looking at current trends: grasping the mature volume of ecology

1) Moderate to severe trends are expected to strengthen user stickiness and ARPU. In the future, mini-games may form a trend of integrating light gameplay to preserve entry and heavy content. The so-called “light gameplay” is aimed at lowering the threshold for users to try. So-called “heavy content” enhances user stickiness through in-depth design such as a development system. 2) The trend of hybrid monetization is likely to strengthen. According to Tencent advertising data, the number of hybrid game products and advertising consumption grew by more than 100% in 2023, and the year-on-year growth rate in 2024 will continue to be 100%. 60% of IAP game purchases are hybrid games. Hybrid minigames are the fastest growing track in the 2023 and 2024 buying trends. 3) Mini-game overseas is a new form of game output. Minigame Goes Overseas focuses on low-cost, lightweight games developed in a short period of time, and focuses on forms such as H5 games and applet games. User acquisition depends on traffic platforms. The Outbound model is subdivided into H5 games going overseas, applet games going overseas, and dual-end distribution. The overseas ecosystem of mini-games is gradually expanding, and leading overseas social platforms such as YouTube, TikTok, and Discord are speeding up the layout of mini-game tracks and gradually starting internal purchase monetization functions.

Risk Alerts

Operational risk, risk of changes in industry policy, risk of game flow falling short of expectations.