16th of October, 2020
There is no secret behind the growth of gaming within the mobile industry. Its remarkable traction in the last couple of years is definitely fueled by its growing competition. Many sophisticated teams are behind these big mobile app brands who are constantly fighting for the top rank spots on the app store.
Just last year, according to AppsFlyer’s analysis, 22 billion US dollars were spent on app ads in gaming. Now with predictions of its current growth, we are looking at nearly 120 billion US dollars in 2020.
It is mindblowing that UA budgets are nearly going to hit $50 billion by 2022, a third of total mobile ad spend. That is a projected 30% year over year growth in 2022, naturally, some regions performing better than others. Nevertheless, it is right to say that every region will experience growth in the mobile app ad market in the next couple of years.
The differences between the regions are very expected due to the APAC’s regions being the absolute best performer when it comes to mobile gaming. However, let us dive into the different regions and let me enlighten you with some perspective on the Ad Spend in the mobile gaming industry.
Ad Spend in the Mobile Industry
No doubt, the highest performing industry is the APAC Region. China, Japan and Korea are the key drivers of the mobile industry with gaming UA spend being the worlds highest, expecting to hit $26 billion in 2022 from the $12.8 billion in 2019. That is more than double in a total of 3 years.
The soul of hardcore gamers are found in this region given the fact that the average CPI in Korea and Japan lies at $10. The competition is reckless and only those with big bucks can take advantage of this demographic.
The latest gaming phenomenon with the title “Genshin Impact” from miHoYo flooded the Asian and Western app market, making it the second top-grossing app in China, taking on previous 2nd place Douyin (sister of TikTok in China). That comes as no surprise with its
$100 million development and marketing budget. A real success story that was bound to happen with its 16 million pre-registrations.
In second place comes of course the growing North American region with an estimated $12.4 billion in 2020 from its $5.3 billion in 2019. In comparison to the APAC region, the demographic fits the casual gamer, dominating half of their non-organic installs.
North America is a tier 1 market due to its large userbase and cost of media, but interestingly enough also holds the world’s largest social casino market.
Coming in 3rd, the EMEA region leading with the UK and Germany are looking at $9.5 billion Ad spend in 2022 from the $3.7 billion in 2019. In Germany, UA budgets hit $530 million in comparison to UK’s $560 million in 2019.
The cheapest region in terms of CPI, Latin America has experienced great growth in the last couple of years, especially in Brazil. Due to its low-cost entry, the total spend is less in this region but anticipated to grow to $800 million in 2022 in comparison to the $300 million in 2019.
Consumer Spend hitting $100 Billion
Now the question you may ask yourself is how much are people actually spending on these mobile games? Well, you can expect a consumer spend of nearly $100 billion at the end of this year, according to App Annie. Again, no surprise here with nearly every second person on the entire planet having a smartphone.
The accessibility to users for mobile gaming has so much potential and reach that marketers can confidently keep spending larger amounts of budget to meet the rising demand. What is important to understand is that within all this feisty competition, marketers need to stand out and lean towards creative placements with new top-end strategies to scale quality users for the best price.