Tackling the Deceleration of Mobile Advertising Growth


The App Utopia That is Long Gone

Just a decade ago, the app landscape was straightforward and uncomplicated. Attracting new users was easy. All you had to do was develop an app, submit it to a store, and watch as users flocked to it. There was also a multitude of categories ranging from games to utilities. There was even an app for monitoring power charging that many of us won’t remember! 

Move forward to the present and it’s clear to see that mobile devices profoundly influence our existence. They have evolved into indispensable instruments that empower us to navigate the digital landscape. In certain mobile-centric regions, individuals no longer need a wallet. Or keys. A single device – their mobile phone – can accommodate all their needs.

The Ever-Growing Realm of Apps

According to Statista, the global app market was estimated to be an astonishing $6.3 trillion in 2021. This was a significant increase on the $4.5 trillion that was achieved in 2020. Annual revenue was said to be $693 billion

Now, if that number doesn’t stun you, then consider this. It surpassed the combined GDP of the United Kingdom ($2.7 trillion) and Germany ($3.9 trillion) in 2021!

And it’s not just about the money. Apple recently said that between the months of April 2019 and September 2020, the iOS app economy single-handedly created 300,000 new jobs in the US alone. Furthermore, the App Store ecosystem currently sustains over 2.1 million jobs across all 50 states. 

Unveiling the Landscape of Mobile Gaming in 2022

As the mobile app economy continues to flourish, it brings along a fair share of challenges. Let’s focus on the major revenue contributor – mobile gaming.

The State of Mobile Gaming Report of 2023 (powered by SensorTower) gives valuable insights into the global landscape. Despite global gaming downloads between 2021 and 2022 remaining unchanged, and the top five genres maintaining their positions, there was a slight decline in the market. 

sesnortower chart 1

When it comes to revenue, the majority of the top 10 genres experienced a decline in 2022. More specifically – RPG, Strategy, and Puzzle games saw a decrease in revenue of -14%, -7%, and -1% respectively. It is worth mentioning that RPG has seen a decline over the past seven quarters.

sesnortower chart 2

While mobile gaming revenue reached its peak in Q3 2021 and is now experiencing a downward trend, it is important to note that this does not signal the end of the app economy.

It is worth remembering that in September 2021, the US government announced the lifting of the ban on travel effective November 2021. This milestone marks a turning point in the pandemic - when people gradually started to return to their day-to-day lives. As we consider 2022 as being the new normal, it is reassuring to see that mobile gaming revenue is stronger than it was in 2019, and that the app economy continues to thrive - albeit at a slower pace. 

The pandemic certainly shaped user behaviors, leading to an increase in remote work, the emergence of digital nomads, and a change in lifestyle. And mobile devices have become integral to this way of life.

Although the number of hours spent on mobile devices will continue to increase, it is unlikely that both the monetary investment and the users' attention will follow. People are becoming more cautious. Particularly in the face of global economic challenges. And mobile marketers need to be prepared for an era of slow growth.

Navigating Through the Slow Growth: Effective Marketing Strategies for Your App

To help you achieve your goals and overcome the challenges of slower growth in the app market, it's essential to employ a variety of marketing strategies. 

  • For Newcomers

If you are at beginner level or plan to enter a new region, the competition will be tough. Pre-registration is a great option. Pre-registration/pre-order campaigns are marketing initiatives that target potential users before the release of an app. 

These campaigns aim to build excitement around the soon-to-be-launched app and encourage users to sign up to be notified when the app is live. Users can then choose to either manually install the app (Android), or have it automatically installed (iOS) upon release.

Pre-registration campaigns help you buy valuable time. It is just like stretching before a work out. Mobile marketing is the same. By preparing the market, you can optimize campaign metrics like CPM and CTR. This will help you scale and reach your desired audience effectively. It's a strategy that sets the stage for better marketing efficiency.

  • New Title

If you aim to release a new title, and already have an established title with a big and loyal fan base, then cross-promotion may be your best option.

Cross-promotion allows an app advertiser to access the audience of an existing app to promote a new app. The goal is to acquire highly engaged users and generate a high return on investment (ROI) at a low cost per install (CPI).

  • Re-engagement 

There are times when - despite your best efforts - users leave your app. At a time of sluggish growth, it is important to focus all your energy on enticing them back. This is where retargeting comes in.

Retargeting is a powerful marketing strategy, driven by real-time bidding technology. It helps advertisers identify lapsed users with a high lifetime value (LTV) in order to deliver them customized messages with personalized creatives. The aim? To reactivate your lapsed users quickly and effectively!

Plus, the cost of reactivating is usually a whole lot cheaper than the cost of an install by a new user. It is also easier - you are broadcasting to a group of people who know you well.

Bottom line

If you are still uncertain as to which marketing strategy (User acquisition vs. Retargeting) suits you the best, head to our infographic - Retargeting vs User Acquisition: Which Strategy Suits Your Next Campaign - for more insights. Or, just send us a message via the banner below.

Surviving is not good enough. We would love to help you thrive! Contact us to find out more about mobile marketing!

Topics: Marketplace Insights