The rise in inflation and increasing cost of living prices have led many to tighten their budgets, prioritizing necessities over non-essential spending. Unfortunately, the mobile game industry has been a victim of this trend. Based on a Data.ai report, spending on mobile games fell by 5% in 2022, to $110 billion, due to inflation and increased competition.
This decline in spending is not unique to the mobile game industry. In fact, according to research from market data firm Ampere Analysis, sales of games and services across the globe were projected to decrease 1.2% annually to reach a total of $188 billion in 2022. However, it is important to note that this decline in spending does not necessarily mean that the gaming industry as a whole is struggling.
Despite the overall decline in spending, the gaming industry has noted significant growth in some aspects of mobile gaming in recent years. The report from Data.ai also highlighted that first-time installs of mobile titles rose 8% to a record 90 billion, with hypercasual titles leading the gains. Games such as Wooduko and Candy Crush are some of the most popular games because they are simple to play and only require movements such as tapping or swiping.
As such, they are the type of games you are likely to see fellow commuters playing on the way to work, as they are easy to learn and can be played with one hand. Hyper-casual games don’t require much time investment or strategy, making them a popular choice for those looking to engage in a simple game on a fairly ad-hoc basis.
Hypercasual games are also popular with advertisers, who can use playable ads to encourage more players to download their games. Playable ads give users the opportunity to sample an app before committing to a full installation by providing a simplified version of the app’s key features. This allows users to have a “test run” before deciding whether to fully access the app.
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The market is expected to face additional challenges in 2023 due to the privacy measures implemented by Apple, which are expected to put more pressure on app developers. In 2021, Apple introduced an App Tracking Transparency feature that prompts users to opt-in or opt out of targeted advertising. Google also plans to introduce similar measures. These changes will make it more difficult for advertisers to attract new players. As a result, Data.ai estimates that global spending on games will decrease by an additional 3% to reach $107 billion this year due to tighter budgets and changes in privacy regulations. However, mobile apps, in general, have faired well in recent years, with first-time app downloads growing 11% to 255 billion in 2022.
It’s clear from the data provided by Data.ai that the mobile game industry has been affected by rising inflation and increasing cost of living prices, leading to a decline in spending. However, it is important to note that this decline does not necessarily mean that the gaming industry as a whole is struggling. The industry has seen significant growth in mobile gaming in recent years, and despite the expected challenges in 2023 due to privacy measures, the popularity of simple and easy-to-play hypercasual titles will continue to drive the industry forward.
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