App Install Ad Spending Reaches $76.2B, Poised To Jump Further

Marketers are ready to spend more than $100 billion by 2022 to increase their companies' global app installs, but questions remain as to whether or not they can keep installers engaged with the content.

“Struggles include retention and uninstalls, so getting users to repeatedly use their apps continues to be a challenge,” said Shani Rosenfelder, head of content and mobile insights at AppsFlyer.

Still, he said, growth will continue at about 20% annually, because millions of users are expected to access mobile apps in the coming years.

AppsFlyer, which tracks app-install mobile attribution, on Thursday published its Global App Install Ad Spend, a three-year projection that forecasts continued growth in spend. The estimates suggest growth will jump from $57.8 billion in 2019 to $118 billion in 2022.

Growth will come from several key markets including China, India, Indonesia, and numerous countries in Africa that continue to experience a surge in app users.

The amount customers spent in app stores reached $120 billion in 2019, according to App Annie.

Asia-Pacific will see the highest spend growth rate in 2020 with $39.4 billion, followed by North America at $17.9 billion, EMEA by $14.5 billion and LATAM by $4.3 billion.

In China, an additional 100 million users will connect to the mobile internet by 2022, reaching 900 million people.

In North America, connected mobile users will only grow by 5% by in the next two years.

AppsFlyer estimates the growth based on a predictive model and its data of 30 billion non-organic installs, $48 billion in ad spend, and a sample of 72 thousand apps between 2017 and 2019.

“The chances of organic discovery of the app are slim to none, so the only way to draw attention to the app is marketing,” Rosenfelder said.

Nearly 60% of app installs among those with a marketing budget are marketing-driven -- up 15% compared with 2018 and nearly 30% since 2017. The study also suggests the share of budgets directed to acquiring new app users will continue to increase in mobile search.

Mobile advertising -- which includes massive search and brand budgets -- totaled $241 billion in 2019 and is expected to reach $368 billion in 2022, according to eMarketer.

AppFlyer’s report also points to factors driving growth in app install ad spend.

Positive native app experiences tops the list, followed by broken strategies around organic app discovery, more confidence in data-driven optimization privacy, gaming, fraud protection, and programmatic, among others.

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