Mobile Apps Show Strong User and Engagement Growth
Privacy headwinds as well as the advent of the metaverse and a new wave of hardware have led many to question the future of mobile’s place at the center of digital marketing. But according to a new report by mobile marketing measurement company Adjust, mobile is experiencing significant growth despite headwinds.
I connected with Simon “Bobby” Dussart, CEO of Adjust, to learn more about growth on mobile and where the space is heading.
Adjust’s recently released mobile app trends report showed strong growth in mobile app usage. How did growth stack up to previous years? What are the highlights marketers across industries should note?
In the last few years, the way we use and interact with apps has drastically changed, with more people than ever turning to mobile for entertainment and daily tasks. Even as the mobile app ecosystem faced significant challenges — such as lockdowns, social distancing, and major changes to user privacy — in 2021, mobile usage has grown significantly. Adjust data shows that fintech, e-commerce, and gaming saw remarkable growth.
Compared to 2020, global installs of fintech apps grew by 35% in 2021. The growth of global sessions of fintech apps has been even more impressive, with an increase of 53% from 2020 to 2021. Session lengths for fintech apps have also increased year-over-year since 2019, growing from 5.42 minutes in 2019 to 7.36 minutes in 2021. This marks a boost in engagement within the fintech vertical, as existing and newly acquired users spend more time on these apps.
The growth of e-commerce apps was steady but impressive in 2021. While global installs of e-commerce posted a 12% year-over-year increase, global sessions jumped by 15%.
The gaming vertical is also on the rise as global installs increased by 32% year-over-year in 2021. This is especially impressive as we saw significant growth in the aftermath of the pandemic, followed by a significant drop-off. On the other hand, the gaming vertical session growth was only 2% in 2021, less than installs or previous years. However, when we consider the user patterns around the first lockdowns in 2020, which increased a whopping 52% compared to 2019, it’s clear that app developers and mobile marketers have continued to do an outstanding job maintaining this dramatic, unprecedented jump.
Our data demonstrates that despite the challenges, there is an increased demand for apps worldwide, resulting in a high number of users downloading and engaging with mobile apps daily. For marketers, it’s crucial to understand the nuances of a vertical to create successful mobile ad campaigns. However, marketers need to look beyond installs and sessions, and focus on how users behave in-app, when they’re returning, and why.
How have ATT opt-in rates evolved since last spring when Apple’s policy went into effect? Why are opt-in rates increasing, and when do you expect we’ll see them plateau, if ever?
Since Apple’s user privacy policy went into effect, the mobile app industry has primarily adapted and understood the benefits of working with a mix of ATT opted-in, device-level data, and aggregated SKAdNetwork data. However, getting the opt-in is still the most crucial part of any iOS UA strategy.
The industry-wide opt-in rate was initially projected by many sources to be no more than 5%. But our recent data shows that it is currently about 25% (up from 16% in May 2021). The gaming industry has been the most successful in this until now, with the highest opt-in rate — 30% for 2021 and 31% for Q1 of 2022. In fact, it’s worth noting that while this report covers data from 2021, we’ve seen opt-in rates grow for every vertical we track so far in 2022 compared to 2021.
Data from AppLovin-owned studios also shows extremely promising results, with multiple popular hyper casual games (where the value of opting-in to personalized advertising is more widely understood) yielding opt-in rates of as high as 75%. We expect to see a continued upward trend as marketers continue to develop opt-in strategies that communicate the benefits of opting in and the upside of receiving personalized advertisements.
Tell us more about the growth in mobile e-commerce, which Adjust’s report highlighted as a strong growth area. Is this weighted toward older or younger consumers? What are the implications for brands and retailers that want to sell on mobile?
We’ve been reporting on the overall growth of e-commerce apps for years, so we know that the most crucial time for marketers is in Q4, where we see the highest install rates as shopping in general moves into its peak season. What we’re also seeing is that this period isn’t just beating out the rest of the relevant year, it’s also growing year-on-year. In the first week of November 2021, installs were up 34% compared to 2020 and 20% compared to the average of 2021. This again proves that the period around the holidays is one of the best times for marketers to promote their apps and drive in-app revenue.
The data from Adjust shows that m-commerce has witnessed a new surge of users, but the retention rates are slightly down, implying it could be time to revisit marketing strategies and ensure that retention is adequately balanced with UA. In H1 of 2020, the average day 1 retention rate for e-commerce apps was 25%, with day 7 at 15%, day 14 at 13%, and day 30 at 10%. By H2 2021, these averages have dropped to 19% on day 1, 12% on day 7, 9% on day 14, and 7% on day 30. Despite this trend, app revenue is higher than ever because even if people aren’t sticking around, they’re spending big while using the app. For brands and retailers on mobile, it’s essential to ensure users acquired are in line with the strategy and LTV requirements, and are producing enough ROI/ROAS before churning.
Other highlights of our data include the ratio of paid installs to organic, which has increased significantly from 2020 to the first half of 2021, jumping from 0.21 to 0.46. Having since decreased to 0.34, it’s a good time for marketers to think about increasing paid campaigns again, as there is less competition, and as a result, it will be easier to get back on top with organic.
Session lengths globally have also increased year-on-year since 2019 for the e-commerce vertical, growing from 10.07 minutes to 10.42 minutes in 2020 and then reaching 10.75 minutes in 2021. Although the total number of sessions per user per day dropped and users had fewer sessions, they spent more time engaged per session — and according to overall in-app revenue figures, they also spent more.
Hypercasual made up the highest share of gaming installs at 27%. For those who aren’t gaming experts, can you tell us what this means for mobile marketing strategy? How can marketers approach reaching users of this segment?
Hyper casual made up the highest share of gaming installs at 27%, but it’s vital to be aware of certain factors that come into play. Looking at just the numbers, it is easy to assume that there are more hyper casual gamers than ever. However, while this might be the case, it is common for users to play several different titles simultaneously – depending on their mood, and to churn relatively early compared to the rest of the gaming vertical. Hence, the user turnover rate per hyper casual gaming app is higher in this sub-vertical than any other because the games have straightforward goals, minimal mechanics, basic controls, and repetitive gameplay.
To make accurate marketing decisions, it is also crucial to compare the breakdown of installs with sessions. For example, hyper casual made up 27% of all gaming installs but accounted for only 6% of sessions. This is still a huge number of sessions, but it makes the user journey — and marketing decisions that should be made, or benchmarked around it — very apparent.
Nevertheless, hyper casual games are in demand and continue to be highly successful. For a hyper casual game to succeed, they need to attract a large audience to generate revenue. Cross-promotion plays a huge role in sustaining a hyper casual game’s success, and boasts the added benefit of publishers being able to utilize the IDFV for tracking. Titles within a single suite can take advantage of one another’s traffic, allowing games to expand beyond their existing user base.
One of the most popular and effective methods of cross-promotion is to use an interstitial ad or app trailer — a short, engaging snippet of the title shown during a break in a player’s user journey. Other effective ad formats include rewarded video ads and banner ads.
