Is Hyper-Casual Dead?(Part1)

Insights and Analysis

Over the past two years, the decline of Hyper-Casual games has become a hot topic. Despite the genre’s massive growth and market dominance in 2022, Voodoo’s announcement at a major conference that Hyper-Casual games are fading has reshaped investment strategies and game development. At PGC London 2023, Alex Shea, Head of Publishing at Voodoo, delivered a speech. One key takeaway from his talk was the assertion that Hyper-Casual is dead.

https://www.pocketgamer.biz/voodoos-alex-shea-hypercasual-is-dead/

We became excited and set out on a mission to track this topic more closely that is Hyper-Casual dead or not? Although data access in the hyper-casual gaming sector is limited, we have uncovered interesting findings in this series of articles titled “Is Hyper-Casual Dead?”

In this part, we analyze AppMagic data to provide a clearer understanding of Hyper-Casual genres games and gaming trends. The article highlights key findings, including outliers that could mislead market perception. Identifying and addressing these outliers helps avoid any misconceptions about the actual trends in the Hyper-Casual market.

Marketing Analysis of AppMagic Data (2022-2024)

Our analysis of AppMagic between 2022 and 2024 provides valuable insights into total downloads and revenue across different game genres. While this data offers a solid foundation, obtaining more comprehensive statics on in-app purchases (IAPs) and ad performance by genre would allow for a more precise and thorough analysis. For now, in this part we have focused on what was available in APPMagic, but we recognize the need for deeper data to refine our understanding of trends in this market and growth opportunities within each game category.

This understandings will help shape our future marketing strategies and provide clearer directions for targeting in the genre the Hyper-Casual games.

Revenue and downloads HC-games

Here, we provide insights into the revenue and download statistics of Hyper-Casual games, as reported by AppMagic in different quarters.

Market trends Analysis

To better investigate and accurately analyze marketing behaviors, countries are categorized into three groups: T1w, T1E and T1w& T1E. These categories represent the top-performing countries in terms of revenue and downloads and user acquisition for mobile games.

Download Trend in Hyper-Casual Market

In this analysis, we take a closer look at the ups and downs in revenue and downloads in the hyper-casual market, using data from AppMagic.

Dramatic Growth:

The period from Q4-2022 to Q1-2023 was a period of exceptional and strange growth for Hyper-Casual games in downloads and revenue, reaching an unprecedented level. This may have been influenced by the impact of the coronavirus or other factors, which will be elaborated in detail in upcoming articles on Hyper-Casual is dead?!!!

Tier-1 East (5 countries)

In the T1East in eastern regions based on their market potential, economic strength, or strategic importance (includes countries like China, Japan, South Korea, India, Russia, and Singapore)

These countries also have strong market potential and high user engagement.

Tier-1 West (6 countries)

T1W refers to high-revenue countries in western regions.

In the Teir-1 west market (which usually includes countries like U.S., U.K., Canada, Germany, France, and Australia) from Q3-2022 to Q2-2024.

These countries are known for their high spending power and significant market potential.

T1w & T1 E (50 countries)

This includes both T1w and T1E countries offering a comprehensive view of global markets by both western and eastern countries.

Sharp decline: After the peak in Q1-2023, the market experienced correction in Q2-2023, with download dropping sharply. Initially, this decline may suggest that consumer interest in Hyper-Casual games may have started to disappear, possibly due to market saturation or shifting preferences.

However, this seems unlikely, as the quarters following Q2-2022 show a slight increase in downloads for the Hyper-Casual genre. This indicates that hype casual games continue to have an audience, though much smaller than the heights seen in early 2023.

Revenue Trend in Hyper-Casual Market

Similarly to the sharp increase in downloads during Q4 2022 and Q1 2023, this data shows a subsequent decline in Hyper-Casual game revenues across major regions from their peak in Q1 2023. However, the revenues have since increased at a stable rate, making it unlikely that the market will be experiencing saturation or a significant drop in interest for this genre.

Total Revenue and Downloads

We have collected and thoroughly summarized data from AppMagic, providing us with valuable comprehensions into the marketing of Hyper-Casual games. As mentioned earlier, there are fluctuations in the Hyper-Casual market, and the reasons for these will be analyzed in the next series.

This data presented in this chart shows a dramatic increase in total revenue for Q1-2023, exceeding 1 billion, largely attributed to a one-time outlier. Following this, revenue significantly dropped in Q2-2023 but steadily increased again through Q2-2024, reflecting more stable, long-term growth trends in the hyper-casual games market.

This chart shows total downloads over several quarters, peaking at 67 billion in Q1-2023 due to a phenomenon like COVID-19. Afterward, downloads stabilized around 3-4 billion. Such events can distort trends and lead to misconceptions about user engagement and market dynamics.

To clarify, we remove outliers that could mislead the market, ensuring more accurate insights.

Downloads- Q2-2023 to Q2-2024

Total downloads of hyper-casual games fluctuated from Q2-2023 to Q2-2024. Starting at approximately 3.67 billion in Q2-2023, downloads dipped to about 3.18 billion in Q1-2024, before rebounding to around 3.70 billion in Q4-2023. By Q2-2024, downloads settled at approximately 3.38 billion, indicating market volatility but signs of recovery.

Revenue – Q2-2023 to Q2-2024

Consistent revenue increased over five quarters, despite a decline following a sharp rise. From Q2 2023 to Q2 2024, total revenue shows a promising upward trend. Starting at $53 million, it reached nearly $97 million by Q2 2024. This consistent growth reflects effective monetization strategies within the hyper-casual gaming sector, indicating a healthy market demand and potential for further revenue increases.

Conclusion:

This article,which is explored from AppMagic, part of the “Is Hyper-Casual Dead?” series, highlights a significant peak in downloads at 67 billion in Q1-2023, influenced by phenomena like COVID-19. Afterward, downloads stabilized around 3-4 billion. By removing outliers, we gain clearer market insights. From Q2-2023 to Q2-2024, downloads fluctuated, reflecting market volatility but signs of recovery. Revenue, however, showed consistent growth, rising from $53 million in Q2-2023 to nearly $97 million in Q2-2024. This indicates effective monetization strategies in the hyper-casual sector.

Considering the behavior of hyper-casual downloads and revenue as a linear function, it reminds us of linear fitting, where removing outliers improves accuracy. During COVID-19, outliers likely skewed the data, affecting our analysis.

So, is Hyper-Casual dead? Probably not. Stay tuned for Part 2, where we dive deeper into hyper-casual gaming, exploring the Dunning-Kruger effect.

Is Hyper-Casual Dead? (Part2)

We are excited for you to share your thoughts and join the discussion! Together, we can dive deeper into market insights within this genre and make even greater discoveries.