In-App Purchase to Outpace In-App Advertising in 2022, Revenues to Grow by 10% YoY to $205B

After two years of double-digit growth, the app market started slowing down. In 2022, global app revenues are expected to hit $430.9bn, 8.3% more than a year ago, and in-app advertising will make up more than half of that value. However, app developers will see revenues from in-app purchases outpace advertising this year.

According to data presented by SafeBettingSites.com, users will spend around $205bn on in-app purchases in 2022, 10% more than a year ago, while in-app revenues are expected to grow by 6% year-over-year to $220.8bn.

IAP Revenues to Jump by $20B in a Year

Although in-app advertising has always been the largest revenue stream of the app market, in-app purchase revenues have grown considerably faster. Between 2017 and 2021, IAP revenues grew by an average of 25% per year, with 2020 as the record year with a 36% YoY growth rate. Also, statistics show in-app purchase revenues almost tripled in the past five years, rising from $74bn in 2017 to $205bn expected in 2022.

Advertising revenues had grown by an average of 19% per year in this period, increasing from $100.2bn in 2017 to $220.8bn.

Although the app market slowed down in 2022, in-app purchases will still see double-digit growth. Statista expects users worldwide to spend $20bn or 10% more on in-app purchases this year. On the other hand, in-app advertising revenues are projected to grow by $12.7bn or 6% in 2022. Overall, IAP will make 47% of total app revenues this year, or 1% more than in 2021, while advertising revenue share will slip from 52% to 51%.

App Market to Witness Smallest Growth in Years

Although in-app purchases will continue rising at a double-digit growth rate, the entire app market is set to witness the smallest growth in years. Last year, global app revenues jumped by an impressive 26% year-over-year to $398bn, the highest annual increase in five years. However, in 2022, the entire market is expected to grow by only 8% and hit a $430.9bn value.

Downloads are also expected to witness a slowdown. Last year, the total number of downloads in the app market reached 220.1bn, 17.5% up from a year before. In 2022, the number of downloads is expected to rise by 6.8% to 235.2bn.