Mobile Monday: Bigger Ad Budgets, Gaming Apps Account for 13% of App Time, and Consolidation — Who’s Next?

Jan 24, 2022
By: Ravi Pimplaskar

Every week, Digital Turbine, AdColony, and Fyber are teaming up to give you the latest news and insights in the mobile world. In this edition of Mobile Monday, Digital Turbine explores the return of ad budgets and new campaign strategies, AdColony discusses mobile games’ continued growth in the new year, and Fyber explains Microsoft’s newest acquisition and the mobile game ecosystem. Learn all about these stories in this week’s Mobile Monday!

Return of the Dead… Ad Budgets

Within the myriad of 2022 prediction posts, one MarTech article is proclaiming that marketers will “release the Kraken” this year — declaring that 2021 pent-up ad budgets will be let loose this year. And with marketers releasing the purse strings, marketers should be advised of a new landscape that has arisen since they last spent… way back in the pre-pandemic era. Now, we do have to mention that some sources, like Forbes, have data that shows that 2021 was a year of record growth in ad spending. But the author does say that the pullback was because larger companies in “verticals like automotive, CPG, retail, apparel, and consumer technology simply didn’t have the inventory to meet consumer demand.” And both things certainly can be true.

The article speaks to several known realities of the changed landscape — like privacy, the shift from walled gardens, and the emergence of Connected TV. However, one nugget that was particularly interesting was that, “brand surveys consistently show that 60% to 70% do not feel ready” for the emerging new reality. And while no one really knows “what to expect,” if you aren’t quite ready, now is the time to figure out how to navigate these changes.

If you are looking for actionable responses to the new landscape, well we’re here to help. First, if you are shifting budgets to Android, like many companies, this article in App Developer Magazine talks about how to smartly optimize your Android budget – including how to test campaigns to make sure you get it right. Meanwhile, for a more holistic privacy aware strategy, this Street Fight Magazine article gives you 4 Ways to Transition your budget: address your entire funnel, re-imagine audience targeting, evaluate with better metrics, and test thoroughly.

As both these articles strongly advise, testing is key. And that’s certainly important to do before you officially… well, “release the Kraken.”  

Consumers Still Prioritize Mobile Games in New Year

Two years ago, the global pandemic forced consumers inside and towards new forms of entertainment — one of which was mobile games. Mobile game downloads and time spent on mobile devices exploded as users all over the world discovered the fun and entertainment that could come from these apps. As time went by and pandemic lockdowns ebbed and flowed, many expected that mobile gaming usage would decline, however, this new love has stayed around and is only expected to continue growing, according to eMarketer

After massive growth in 2020, time spent in mobile games still increased in 2021 leading to users spending 30 more seconds in these apps. Moreover, eMarketer explains that as consumers are continuing to spend more time on smartphones in general, in the U.S., time spent on gaming apps will account for 13% of all app time in 2022 and stay above 12% in the future. 

From casual to action games, users of all ages are staying engaged with mobile games in the new year. In fact, according to Sensor Tower’s latest report, consumer spending in action games in 2021 increased by 69% year-over-year, which equates to about $967 million in revenue. Following action games, hypercasual mobile games saw the next largest growth of 43% year-over-year in revenue. With this expansion, it is clear that users are committed to playing mobile games and spending in those apps. Even if downloads cannot match the 2020 boom, time spent and revenue from mobile games will continue to increase, further cementing the power of mobile gaming as an avenue to reach consumers of all demographics. 

The Waves of Consolidation 

Consolidation made such an impression in 2021 that now it’s weird when a day goes by without a buy or sell. Historically, the mobile app industry was a very fragmented space, and it rapidly consolidated across both content and adtech in the last year. With the surge of mobile usage and the infrastructure now available in the mobile app ecosystem, mobile gaming has been bulldozing through the industry at an alarming pace. But then again, so is the competition.

Microsoft Acquires Activision Blizzard

So it was natural that the big news of Take-Two’s acquisition to buy Zynga for $12.7 billion made waves in the industry commentary. Until… Microsoft’s $69 billion deal for Activision Blizzard sent shockwaves. What does this acquisition signal to us? The record-breaking numbers and upticks in consumer spend are making the mobile gaming space more attractive than ever before. Everyone wants a piece of it, actually, double portions of it. Microsoft now has access to some of the biggest gaming titles in history, including the popular Call of Duty, Candy Crush, Warcraft, and more. Microsoft’s Xbox will most likely house some of these big names, and at the same time, tap into the mobile gaming world with an already established fanbase of players and a whole lot more resources. 

To add to Microsoft’s recent acquisition, the giant entered an agreement to acquire Xandr, a global programmatic marketplace for premium advertising. So, it appears they’re getting their mobile gaming ducks in a row. With the enormous industry growth, consolidation has become a necessary step in the industry’s life cycle, and the competitive dynamic that fuels the gaming space is only going to inflate. 

About Mobile Mondays
Mobile Monday examines the latest news, trends, and developments in mobile apps, tech, and advertising. Do you have a story to share for the next Mobile Monday?  

About Fyber
Fyber, part of Digital Turbine’s independent Mobile Growth Platform, develops innovative ad monetization solutions trusted by top mobile game and app publishers. Fyber’s product suite offers publishers a trusted, unconflicted alternative that drives superior results by creating an optimal connection between mobile audiences, top global brands, and mobile-first advertisers across over 40Bn daily ad opportunities. Fyber’s FairBid mediation, Fyber Marketplace, and Offer Wall Edge are all built with performance, scale, and transparency in mind. To dive deeper into how their monetization solutions put app developers first, check out their blog.

About AdColony
AdColony, part of Digital Turbine’s leading independent mobile growth and monetization platform, helps brands, agencies, and apps expand their reach and results with the power of mobile. AdColony is known globally for its award-winning video advertising marketplace, with ad engagement innovations like Instant-Play™, Aurora™ HD Video, Playables, and more. Looking for more insights on apps and mobile games? Find out more on their blog!

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By Ravi Pimplaskar
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