The strengthening of hybrid monetisation, positive results for casual games compared with mid-core and hypercasual categories, and the contrasting revenue outcomes between in-app advertising (IAA) and in-app purchases (IAP) are the significant shifts beneath the seemingly stable surface that have been unearthed by the latest State of Gaming App Marketing for 2024 report.
The in-depth report released by AppsFlyer investigates the shifts behind the modest growth in mobile gaming over recent years, including the blending of revenue sources, optimal engagement timing for maximum revenue, and nurturing trust through retention strategies.
The report reveals that in 2023, the divisions between the revenue strategies of hyper casual and mid-core, such as role-playing and strategy games, have blurred, with both categories adopting a hybrid model of monetisation that has surged 20 per cent across the industry.
Traditionally, hyper casual titles primarily relied on in-app advertising (IAA), while mid-core games leaned toward in-app purchases (IAP) for revenue streams. However, a visible shift for these two categories occurred in 2023, with apps on both ends diversifying their income channels, which translates to mid-core games increasing their advertising efforts and hyper casual incorporating more in-app purchases.
This diversification of revenue strategies drove a 39 per cent jump for hyper casual games, while mid-core games increased 16 per cent.
“The paradigm shift that we see in this report has not only blurred the boundaries of how gaming apps are bringing in revenue, but has also crafted a market that thrives on nuance and adaptability. This transformation signifies a substantial recalibration impacting the entirety of mobile gaming,” said Adam Smart, Director of Product, Gaming at AppsFlyer.
“For marketers looking to capitalide on the current market, not putting too many eggs in one basket is the right way to go. With cost per installs (CPIs) down on iOS, meaning the time to benefit from the lowest cost of media that can be exploited, and Android posting positive results across several indicators such as installs and NOIs, the future of growth will be around diversifying,” Smart added.
Additional key insights from the 2024 State of Gaming App Marketing included:
- $29 billion total gaming app install ad spend worldwide in 2023.
- More than 70 per cent of buyers repeat purchases.
- User-generated content brings the highest retention rates.
- Casual games see 13 per cent rise in non organic installs (NOIs) and ad spend.
- Cost per install (CPI) jumped 48 per cent on Android while iOS saw a 17 per cent drop.
The State of Gaming App Marketing report also details that early engagement in mobile gaming remains a pivotal factor in determining the success of revenue through IAP purchases, particularly within the first week after downloading.
On iOS platforms, the spending trend initiates swiftly, with the first purchase typically occurring two days after download. By the third day, an additional 17 per cent of users engage in transactions.
