'Miitomo,' Nintendo's First Smartphone Game, Is A Hit For Now

Nintendo's first smartphone game, "Miitomo," has reached 3 million downloads since its launch in Japan in March. The social game featuring avatars of users was released in North America Thursday along with the My Nintendo rewards program. Despite its early success, Nintendo can't call a "Miitomo" a hit just yet because earning revenue on smartphone games is quite different from selling games for a console.

"Miitomo" is a free-to-play game with in-app purchases. Players could, in theory, play the game without ever buying anything within "Miitomo." The social game has players create a digital avatar, called a Mii, to interact with friends within the game. Players can complete daily missions, such as linking their Facebook account to My Nintendo, or answer questions to earn Miitomo points or My Nintendo Platinum Points. One way Nintendo could make money from the game is by having users purchase Miitomo coins with real currency to purchase accessories or clothes for a player's Mii.

Nintendo's first smartphone game is considered an experiment as the company adjusts to a new platform. Nintendo has made a name for itself as an industry giant developing video games and consoles. That expertise does not extend to the smartphone game sector, which is why Nintendo partnered with DeNA, a Japanese mobile game and platform company, as it entered unfamiliar territory.

Miitomo is currently the most downloaded free game for iOS, but has yet to crack the top 100 in the Google Play store, according to app analytics firm App Annie. Monetization and retention are key to the success of "Miitomo," which is why many people will be watching the Top Grossing chart on the iOS store and Google Play. Supercell has staked its claim in the smartphone gaming empire with games that make a lot of money for a long period of time. Supercell reported revenue of $2.3 billion and profits of $930 million in 2015 based on the strengths of "Clash of Clans, "Hay Day" and "Boom Beach." "Clash Royale," Supercell's latest game, was released in early March and quickly became the top-grossing app of any kind in the United States.

The My Nintendo Rewards program may be a way to have players stay with "Miitomo." Players can earn different levels of points by completing different missions. Changing your Mii's clothes can earn you five Miitomo Platinum Points every day, while signing in to the Miiverse can net you 30 Regular Platinum points once a week. Buying downloadable games for the Wii U or 3DS earns players Gold Points. The platinum points can be combined for discounts or new items. Gold Points can unlock free games.