According to a recent report by AppsFlyer, the mobile gaming market has experienced modest growth in recent years. The report provides valuable insights into user acquisition trends, spending, and platform differences. The data used in the report is based on anonymized and aggregated data from 15,000 gaming apps with at least 3,000 non-organic installs per month. This approach provides a more accurate representation of the market compared to estimates-driven reports.
The report highlights the importance of diversifying marketing efforts, as the mobile gaming market continues to evolve. The paradigm shift in the industry has blurred the boundaries of how gaming apps generate revenue, creating a market that thrives on nuance and adaptability. Marketers looking to capitalize on the current market should avoid putting too many eggs in one basket.
**Competitive Mobile Markets**
The report reveals that the United States is the most competitive market for user acquisition, both on iOS and Android. In 2023, app developers spent a staggering $12.2 billion to acquire new users in the US, accounting for over 40% of the global user acquisition ad spend of $29 billion. In comparison, the next most sought-after markets, Japan and South Korea, accounted for $3 billion and $1.5 billion, respectively. The US alone accounted for more user acquisition spend than the other top 10 markets combined.
**Genre Preferences**
When it comes to acquiring new players, developers are spending the most on match games for mobile. The genre accounted for $8.65 billion, approximately 30% of global user acquisition spend. Strategy, RPG, casino, and simulation games also ranked high in terms of spending. Together, these top five genres accounted for around 25% of all user acquisition spending.
Interestingly, the report highlights a 13% rise in non-organic installs and ad spend for casual games compared to previous years. Simulation and action titles also saw significant growth in these metrics. On the other hand, RPGs and strategy games, despite being high-spending genres, experienced declines in non-organic installs and ad spend.
**Platform Differences**
The report also sheds light on the differences between iOS and Android in terms of user acquisition. While ad placement costs fell by 17% on iOS and rose by 48% on Android in 2023, the cost per install (CPI) is still significantly higher on iOS. In 2023, CPI averaged around $6.80 on iOS and $1.35 on Android, signaling increased efficiency for developers looking to acquire new iOS users.
**Changing Monetization Strategies**
AppsFlyer’s data reveals a shift in monetization strategies for mobile games. The traditional division between hyper-casual games relying on in-app advertising (IAA) and mid-core games focusing on in-app purchases (IAP) is blurring. A hybrid model that combines IAA with IAP is on the rise. In 2023, 43% of games used a hybrid monetization model, up from 36% in the previous year.
The adoption of hybrid models can be attributed to various factors. Hyper-casual titles have been affected by Apple’s App Tracking Transparency (ATT) changes, leading to reduced IAA revenue and difficulty finding high-value users. On the other hand, mid-core games are incorporating IAA to compensate for the stagnating growth of IAP. These games have benefited from less intrusive ad formats, reducing the retention hurdle that ads once posed.
For developers planning to use in-app purchases, it’s important to note that only a small percentage, typically 5%, convert to paying users. However, payers are likely to be repeat buyers, with around 70% making second purchases.
**Monetizing Users Early**
AppsFlyer emphasizes the critical importance of monetizing users early in the mobile gaming industry. The first week is crucial for converting players into payers. Approximately 50% of lifetime payers on both iOS and Android make their first purchase within the first three days. This highlights the need for developers to engage and monetize users from the moment they download the game.
In conclusion, AppsFlyer’s annual report provides valuable insights into the mobile gaming market, including user acquisition trends, genre preferences, platform differences, and changing monetization strategies. The data-driven approach of the report enhances its credibility and authority, making it a valuable resource for app developers, marketers, and game studios.
