The mobile games market offers potential for huge success. But, as the market has matured, it has become steadily more difficult to reach new players and retain existing ones.
Mobile is now home to dozens of different game experiences, from high-spec 3D action games to far simpler titles. It is these simpler experiences or hypercasual games that Pangle - TikTok for Business ad network - and industry analysts Newzoo have focused on with their latest report, which offers reliable insights for developers and publishers looking to better understand the state of the mobile game market in 2022.
The report examines the performance of hypercasual games using recent historic download data rather than in-app purchases (IAPs), as the biggest revenue stream for this segment tends to be in-game ads.
In this article, we've picked out some of the key findings from the report, including what publishers are doing to retain players, how this segment has been affected by data protection changes to mobile app stores (IDFA regulations) and the popularity of hypercasual games between the Western and Eeastern mobile markets.
If you'd like to learn more about hypercasual games, read the full report here: Hypercasual Genre Report: Comparing & Contrasting the Genre in Eastern and Western Markets
WHAT IS HYPERCASUAL?
Let's not get stuck in semantics. Pangle and Newzoo define hypercasual games as 'simple, minimal gameplay' often dependent on 'ad-based monetization.' Titles inspired by the arcade games of the '70s and '80s, one-button endless runners, and straightforward word games -- hypercasual games have incorporated all these genres and more.
By Pangle and Newzoo's metric, the hypercasual segment was the most downloaded genre of mobile games in the US, UK, Japan, and South Korea in 2021, despite the Identifier for Advertisers (IDFA) regulation changes. The number of hypercasual products in the top 100 download charts in the aforementioned countries grew year-on-year, from 14% in 2018 to 36% in 2021.
In this new era, Pangle and Newzoo say the hypercasual genre is faced with less of a user acquisition challenge compared to casual and mid-core due to its broad targeting strategy.
However, the biggest challenge facing hypercasual games continues to be retaining players.
HOW DO YOU FIX A PROBLEM LIKE CHURN?
Player churn is typically much higher for hypercasual games than for other genres. The average seven-day retention for mobile games is around 20%; that rate often falls below 10% for hypercasual games.
To combat player churn, publishers have been focusing on ways to improve retention and find new revenue opportunities. Pangle and Newzoo found that publishers are combining meta gameplay elements from other popular genres, such as puzzle and simulation, to add depth and replay value and create additional monetization opportunities.
For example, Join Clash from Supersonic, a 3D endless runner, now features RPG mechanics and customization. Tangle Master 3D from Rollic has added a pet-like system to its central color-sorting gameplay, giving it new personality. And High Heels, also from Rollic, has introduced leaderboards and begun experimenting with live operations - such as partnering with Kenneth Cole for the designer's Pride 2021 collection - to increase player engagement.
THE NEW STANDARD
Deeper game mechanics and the layering of added personality, meta games, or live events are some of the top ways creators of hypercasual games are making their titles more competitive. Alongside this, they are also looking to supplement their core ad revenues with hybrid monetization.
"Hypercasual developers are now thinking carefully about their advertising model to prevent pushing more players to churn"
Before we get to that, let's touch on in-game ads briefly. In-game ads remain the biggest revenue stream for hypercasual game developers, Pangle and Newzoo have found. In the last year, more hypercasual games have been attracting advertising from other gaming segments as publishers see new potential customers in this broad demographic.
These ads break up the gameplay experience, gating progress, unlockables, and rewards. The interstitial video is generally the most common ad format used in hypercasual games. The report looked at the acceptability of ad formats in Japan, South Korea, Brazil, and Russia in 2021. It concluded that banner ads are more accepted in Brazil and Russia than in Japan and South Korea.
Speaking of acceptable, hypercasual developers are now thinking carefully about their advertising model to prevent pushing more players to churn and incentivizing players to pay to enhance their game experience in new ways. Of course, it is now commonplace in hypercasual games and many mobile apps to make a one-off payment to remove ads. Some studios, such as Homa Games (makers of Sky Roller), have been experimenting with incentivizing players to pay a subscription that removes ads and gives them exclusive content or extra in-game currencies.
SNAKE.IO: MADE IN AMERICA, ADORED IN ASIA
So, hypercasual game developers are making moves to retain players in the ever-challenging mobile space. However, while players in the West have developed an attachment to hypercasual titles, they are not nearly so popular in the East. Around half of the Top 100 games by downloads in the US and UK in 2021 were hypercasual compared to only around 20 of the Top 100 in Japan and South Korea.
One developer that has managed to create a hypercasual game that is a hit in Western and Eastern markets is Kooapps. Snake.io, a colorful and competitive spin on the snake game genre millions are familiar with, is reaching 2.5 million daily active users (DAUs). For DAUs specifically, the Philippines, Vietnam, and Indonesia are in the game's Top 15 countries. Meanwhile, from a revenue basis, Japan, South Korea, and Taiwan are among the Top 15.
To achieve this success in Asia, Chun-Kai Wang, CEO, and co-founder of Kooapps, told Pangle his studio needed a game idea with universal appeal and business partners with solid local tact.
As the mobile industry gets increasingly competitive, make sure that you have the best setup and the best networks on the ad tech side"Chun-Kai Wang, Kooapps
"It was really Snake.io that helped us unlock the opportunity in the Asian markets. With its universal mechanics, Snake.io transcends language and culture and becomes a game everybody wants to play. That allowed us to enter the Asian markets," explained Wang.
"On the ad monetization side, you should work with partners who have strong local expertise. As the mobile industry gets increasingly competitive and consolidated, make sure that you have the best setup and the best networks on the ad tech side. Test as many networks as possible [and make sure it's all optimized]."
Jason Wang, product lead at Pangle, says the company is well placed to help hypercasual publishers achieve global success: "With innovative products like Retention Optimization and expert teams that work with publishers to optimize their UA strategies, create fun, engaging and effective ads, and ensure that every aspect of their game marketing is supporting their monetization goals."
In the full report, you can read more about Snake.io in Asia, the opportunities for hypercasual games, and how Pangle could benefit your company.
Pangle is the ad network of TikTok for Business, enabling global app developers to grow their apps and maximize earnings through exclusive ad demand from TikTok for Business. Pangle offers a growing network of mobile apps in over 35 emerging markets, with proven success in Asia, Middle East, and Latin America.
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