TLDR: Despite a booming mobile app market in India and globally, 88% of mobile app advertising budgets are still concentrated on Google and Meta. New research from Moloco, an AI performance advertising company, suggests that diversifying ad spend beyond these tech giants can yield significantly higher returns, with some advertisers seeing up to 214% improvement in Return on Ad Spend (ROAS). This shift is driven by accelerating app growth in emerging markets like India and changing user attention towards diverse app categories, including generative AI.
India’s rapidly expanding mobile app market is poised to disrupt the long-standing duopoly of Google and Meta in the digital advertising landscape. A recent research study by Moloco, an AI performance advertising company, titled ‘Performance Through Independence: Unlocking Incremental App Growth Beyond Google and Meta,’ highlights a significant disparity: despite shifting consumer behavior, a staggering 88% of mobile app advertising budgets remain concentrated with these two tech giants.
The report, developed in collaboration with Sensor Tower and Singular, reveals compelling data. In 2024, consumer mobile app revenue, encompassing in-app purchases (IAP) and subscriptions across non-gaming categories like entertainment, finance, and delivery, surged by 25% to reach an impressive $70.5 billion. This growth trajectory is accelerating, with projections indicating that consumer mobile app revenue will surpass gaming revenue within the next two years. However, the allocation of advertising spend has not kept pace with this diversification of user attention.
Moloco’s findings suggest that advertisers who diversify their media mix beyond Google and Meta can achieve substantial financial returns. The study indicates that Return on Ad Spend (ROAS) can improve by as much as 214% (Day 30) for marketers who embrace channels outside the dominant platforms. Tom Shadbolt, Senior Insights Manager at Moloco, emphasized this point, stating, “Too many advertisers are still over-indexing on Google and Meta. But the biggest returns we are seeing are happening outside big tech. The independent app ecosystem is quickly becoming the new engine for predictable and long-term performance. This research is a wake-up call for mobile app marketers.”
The research also points to a geographical shift in mobile app growth. While mature markets such as the US, UK, Germany, and Japan are experiencing a plateau in usage, emerging economies like South Africa, India, and the Philippines are witnessing a sharp rise in time spent on mobile apps. This reflects a broader trend towards sustainable growth that necessitates reaching users across a more diverse range of applications.
Furthermore, user attention in key markets like the US, UK, and India is evolving beyond traditional social media and entertainment apps. Categories such as casual gaming, productivity, and generative AI apps are experiencing faster growth. A significant demographic shift is also noted, with over half of all mobile users, and nearly two-thirds of 18 to 34-year-olds, expressing a desire to reduce their social media consumption. This indicates a fertile ground for advertisers in alternative app environments.
The ‘independent app ecosystem,’ comprising millions of diverse mobile apps developed and monetized by companies outside the major tech giants, demonstrates immense reach. With over two billion daily active users (DAU), this ecosystem collectively delivers user engagement comparable to that of TikTok and Instagram combined. This highlights that high-value users are dispersed across a vast array of applications, making broad reach crucial for maximizing conversion opportunities.
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Valerie Castro, Acquisition Marketing Director at Turo, a mobile app marketplace for car rentals, corroborated these findings, stating, “Since expanding our channels beyond social partners, we’ve seen an increase in platform bookings that we have been able to validate through incrementality modeling. We’re excited to push performance further by increasing our creative velocity.” The Moloco report underscores a critical message for mobile app marketers: to unlock incremental growth and optimize returns, a strategic shift towards a more diversified advertising approach, leveraging the burgeoning independent app ecosystem, is imperative.
