Gaming app marketers must brace for impact

By Jalaja Ramanunni

About $26.7bn was spent on gaming app install ads globally in 2022, reveals a new gaming report released by AppsFlyer. The United States takes credit for half the spend half at $12.2bn owing to its high-volume and high-cost media landscape, followed by Japan as a distant second with a nearly $2bn spend.

AppsFlyer today released its report ‘State of Gaming App Marketing for 2023’, a detailed study on significant gaming trends for app developers, marketers and game studios to use as they navigate through a year of challenging macrotrends such as the new era of data privacy.

‘Brace for impact,’ the AppsFlyer report states. It predicts that the gaming market is headed for a difficult year after several years of rapid pandemic-driven development as macroeconomic headwinds continue to affect the sector. Games have been forced to prioritise profit over growth as a result of the financial slump as securing funds has become far more challenging while consumer spending has been negatively impacted.

“If 2021 and the first quarter of 2022 was the golden age of gaming, the second half of 2022 and especially 2023 will be a time that marketers, developers and studios will need to overcome challenges to adopt highly-focused, efficient strategies for attracting and inspiring loyal, valuable players,” said Shani Rosenfelder, director of market insights, AppsFlyer. “Despite the hurdles, however, mobile gaming remains a lucrative powerhouse nearing three billion players globally. Marketers will continue to succeed by putting more focus on modern measurement capabilities, utilising techniques that deliver an engaging experience while respecting user privacy, and leveraging remarketing and owned media channels further in order to offset increases in their CPI,“ she adds.

Marketers are increasingly leveraging owned media channels. The use of owned media methods like push notifications, in-app messages and cross promotion is steadily increasing as marketers try to squeeze more value out of their budgets. Due to this, owned media conversions have significantly increased year over year, growing by 16 per cent on iOS and 34 per cent on Android, according to the report.

One of the key insights that surfaced from the report is the difference in overall game app installs on Android and iOS in the US; there was an 8 per cent YoY growth in total app installs of Android games and a 5 per cent YoY install drop on iOS, which reflects the continued challenges iOS app marketers are facing following Apple’s privacy changes. In 2022, the cost per install (CPI) on iOS shot up by $3.75 per install as iOS marketers continue to accept high prices to acquire valuable Apple users.

Overall, Android game app installs rose slightly, by 8 per cent compared to 2021, whereas iOS game app installs showed a small decline with a 5 per cent drop. Based on advertising investment, the United States remains the largest target market for gaming app marketers by a significant margin, followed by Japan, South Korea, Germany and the United Kingdom.