For the first time ever, mobile games have lost their crown as top app category for consumer spending. According to the latest report from Sensor Tower, the majority of U.S. users spent money in non-game apps from Apple’s App Store in Q2 2022, marking a turning point from the past. Indeed, consumer spending has shifted towards subscription apps such as streaming platforms like Netflix and HBO Max or dating apps like Tinder and Bumble.
This is the first time mobile games don’t claim the top spot in terms of consumer spending, and it has a natural impact on mobile user acquisition too. Ad spend from subscription apps, which was already growing during and after the pandemic, is now expected to see a dramatic boost. More and more advertisers are going to promote their subscription apps increasing their budget for mobile user acquisition and app promotion.
What are subscription apps
Subscription apps is a broad app category, which includes streaming & entertainment platforms such as Netflix, Disney+, HBO Max and many more, but also every other app that monetizes through a paid subscription, from dating to educational apps.
These apps are usually free to download but then provide premium services that come with a premium paid subscription. The premium services can range from ad-free content to new features inside the app, not available in the free version. According to Sensor Tower Report, 2022 Q2 top apps in this category were Youtube, TikTok, HBO Max, Disney+, Tinder, Hulu and Bumble.
But how does subscription apps’ boom affect mobile user acquisition?
Mobile user acquisition for subscription apps
Consumer Spend Growth in subscription apps is both a consequence and a cause of mobile user acquisition and app promotion through paid advertising activities. Indeed, subscription apps’ ad spend has been significantly growing since the pandemic started in 2020 and this trend doesn’t seem to stop. Subscription apps’ developers are allocating their advertising budget to app promotion and especially app install campaigns.
The reasons behind that can be the performance-based nature of these activities. Advertisers can run app install campaigns with marketing partners and pay for performance and not for traffic only. For example, advertisers can promote their subscription apps through CPI (cost-per-install) or CPA (cost-per-action) campaigns, paying only when users download and open their app or after they carry out a post-install event.
By choosing the subscription as the payable in-app event, advertisers will pay their marketing partners only for a user who will generate revenue for them as a subscriber.
Furthermore, mobile user acquisition campaigns can be run through programmatic platforms, which have sophisticated targeting abilities and are able to optimize app promotion towards high-LTV users by leveraging machine learning algorithms.
In conclusion, by combining branding activities with app promotion, advertisers can drive consumer spend towards their subscription apps increasing their revenues while achieving ROAS positive app install campaigns.
Grow your subscription app with Mapendo
Mapendo is a tech platform for mobile user acquisition. We are a fully managed DSP, which runs machine learning powered CPI/CPA app campaigns. We help subscription apps acquire high-quality users at scale with programmatic traffic. Our ads reach 300 million people in the US every day and generated 1 million conversions for our clients in the last quarter.