App Store Sales to Double By 2018, In-App Ads to Triple [Report]

App Store Sales to Double By 2018, In-App Ads to Triple [Report]

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App Annie and IDC have released a joint report entitled, 'Mobile App Advertising and Monetization Trends 2013-2018: Freemium and In-App Ads Expand Their Lead'. The report focuses on the main growth drivers in mobile, and the business models enabling publishers to monetize successfully off of that growth. It also highlights mobile app revenues beginning to displace other forms of monetization, including mobile browser and PC-based advertising, and freemium and in-app advertising models driving the majority of growth among various business models.

"App Annie has tracked the growth of the mobile economy since its infancy, and we're really starting to see publishers hit their stride with mobile in-app revenue growing 1.7x last year," said Bertrand Schmitt, CEO and co-founder, App Annie. "The continued innovation in mobile apps, monetization models and mobile advertising have driven significant growth in freemium and in-app advertising revenues. The space has matured significantly and publishers have the required 'know-how' to monetize off the significant app usage they're generating."

Some key takeaways from the report include:
● Freemium drives mobile app revenue growth: Freemium app revenues grew by over 70 percent, while paid and paidmium app revenues declined by 19 percent and 24 percent, respectively. The maturity and general success of the freemium model are clearly evident in freemium's dominance of direct app revenue models. Mobile app revenue per device (including advertising) is projected to grow 2.5x by 2018.
● Mobile in-app advertising set to overtake online search advertising: Mobile in-app advertising revenue also grew by 70 percent, outpacing both mobile and PC browser-based ads. By 2018, spending on mobile in-app advertising alone (in the 10 key countries measured*) will be greater than spending on online search advertising, today's digital advertising juggernaut.
● Geography matters and it's not one-size-fits-all across countries: Revenue generated through app stores versus in-app ads widely varies across countries—India brings in 70 percent of its app revenues via in-app ads while Japan makes more money via app stores (81 percent). The US and Japan are the largest markets for mobile app revenue, but emerging markets such as Brazil, India and Russia are projected to quickly grow through 2018.

"Both freemium and in-app advertising will continue to be great opportunities for developers to make money out of their apps," said Karsten Weide, IDC's Vice President of Media & Entertainment. "In the ten key markets we looked at, in-app ads will grow by a factor of 3x by 2018, and app store sales by a factor of 2x."

Hit the link below to download the full report...

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App Store Sales to Double By 2018, In-App Ads to Triple [Report]

DoughBoy - March 31, 2015 at 10:44pm
The presence of in-app ads aren't nearly as bothersome as they once were. Not by a long shot. Today, it's exceedingly difficult to sell apps. Freemium is the market for devs to be in and without ads to monetize, they're not going to be able to make apps. So between a growing acceptance of mobile ads by devices owners and the improved aesthetics and targeting capabilities of leading ad platforms like Airpush, Admob, and others, this explosion in app downloads will mean bigger paychecks for developers and better experiences for mobile app users.
NoGoodNick - March 31, 2015 at 4:57pm
That's WONDERFUL (author smirks). The last thing any of us need are more FREE ads we have to pay for simply to NOT be constantly annoyed. I don't see that as a gain, but as a worseing of the ENTIRE app store. I don't mind paying for apps I use, but I resent being force fed apps that won't function until you pay cash to get them to work. That's why I REFUSE to upgrade any app until I'm assured it doesn't break the existing app's functionality. I don't see how apps will increase that much when they're simultaneously making them less desirable.
iPhone 6 Plus is my boy - March 31, 2015 at 9:33pm
To be honest, developers had no other choice since pirating paid-apps are super easy.(installous, appcake, etc) and now you can install paid-app even without jailbreaks. Also Apple wasnt really doing anything to protect devs from these pirates so pretty much forcing devs to rely on in-app purchases. But i do agree with overcharging most apps bring these days. I miss the day when we could play full game with paying 1-5 dollars instead of keep asking $10 in-app purchase to continue etc