Why mobile publishers are moving from hypercasual to hybridcasual

Summary:

With new privacy policies from platform holders making it more challenging than ever to mobile marketers to conduct effective user acquisition campaigns, a number of top hypercasual publishers are moving to ‘hybridcasual’. We analyse what this new genre is, and why the shift is happening.


One of the biggest trends in the mobile games industry right now is developers making the shift into the relatively new ‘hybrdicasual’ genre. This is largely being led by hypercasual publishers aiming to become less reliant on ad revenue following Apple’s app tracking transparency (ATT) policies, which has had a seismic impact on the entire business model.

But what exactly is hybridcasual, how did it emerge, and why are some publishers so bullish on it? We first need to go back to the origins of hypercasual.

The emergence of hypercasual

The term ‘hypercasual’ was coined by then Applovin Managing Director for EMEA Johannes Heinze, now the Co-Founder of developer Popcore, which also makes games in the genre. In a three-part series on PocketGamer.biz published in 2017, he described their emergence over the years as they steadily came to dominate the App Store and Google Play download rankings.

Hypercasual titles are quick, one touch games typically built on a single mechanic. The graphics are simple, they lack various monetisation features that mobile games are known for, and are designed for quick gameplay sessions and generally have little long-term retention of users. They are almost entirely monetised by ads, which typically promote other hypercasual titles, and so the circle continues. (In fact, later, ads companies themselves such as IronSource and Applovin established their own hypercasual publishing businesses, Supersonic Studios and Lion Studios, respectively).

To sum up, as noted in this article on Deconstructor of Fun, ‘The Hybridcasual Gamble’, hypercasual games are “the bubble gum of the gaming industry”. 

The early winners of the hypercasual space were Voodoo – publisher of titles such as Paper.io and Helix Jump, and Ketchapp, which released hits including Rider, 2048 and Stack.Voodoo later received $200 million of investment from U.S. private equity firm Goldman Sachs in 2020, just before Tencent took a minority stake shortly after to value the publisher at $1.4 billion. Ketchapp was acquired by Ubisoft in 2016.

Sensor Tower’s Mobile Game Taxonomy Report 2021 estimated that in 2017, the hypercasual accounted for 12% of downloads among the top 1,000 games worldwide across the App Store and Google Play. This put it behind the Arcade (19%) and Puzzle (15%) genres.

By 2020, hypercasual accounted for 31% of installs, double that of Arcade.

In 2020, Sensor Tower estimates hypercasual games picked up 11.9 billion downloads worldwide across the App store and Google Play, rising to 13.7 billion in 2021. This marked the height of the hypercasual business, spawning a series of successful companies including the aforementioned Voodoo, Supersonic and Lion Studios, along with others such as SayGames, Good Job Games, Kwalee and Homa Games.

But then Apple made an announcement that would send shockwaves through the industry, and in particular in hypercasual.

Hypercasual hits turbulence

In June 2020, Apple announced the deprecation of the identifier for advertisers (IDFA). This collects information on user behaviour, such as what apps and websites they use, which helps publishers and advertisers target users that are most relevant to them. Without IDFA, that information is hidden, and so user acquisition becomes more akin to shooting in the dark. This upends the entire UA and ads model, the foundations of the mobile games industry, and in particular hypercasual, which suffers at both ends.

Fingerprinting, a method of using certain data points in an attempt to identify users even without an ID, had been a rule-bending workaround. But Apple’s upcoming Privacy Manifests, which forces developers to record data that third-party SDKs collect and how they use it, is set to put an end to this, putting further pressure on hypercasual publishers and the mobile games sector as a whole.

While there are macro-economic factors such as inflation and cost of living, as well as comparisons to the outsized growth the games industry experienced during the global pandemic and lockdowns, ATT has played a key role in the market’s declining revenue. Data.ai estimates in its State of Mobile Gaming 2023 report that mobile games generated $110 billion worldwide across the App store, Google Play and third-party Android stores in China, a decline of 5% Y/Y.

Meanwhile, new game downloads were up 8% Y/Y to 90 billion. However, according to Sensor Tower’s The State of Mobile Gaming 2023 report, global hypercasual game downloads (App Store and Google Play only) dropped by 10% year-over-year to 12.3 billion. In Q4 alone, installs were down by 24% Y/Y to 2.7 billion.

The situation reached a point where Voodoo’s Alex Shea proclaimed “hypercasual is dead”.

Hybridcasual Rises

One evolution of hypercasual is ‘hybridcasual’, which sits between the former genre and the casual category, which features classics like Candy Crush Saga and Gardenscapes. Hybridcasual keeps the simplistic gameplay and visual styles of hypercasual games, but adds an extra layer of progression. In theory, this leads to higher retention, as players have reason to come back. These titles also implement in-app purchases, so they no longer generate all their revenue through ads. 

In theory, these hybridcasual games could keep the best parts of hypercasual – wide appeal, relatively low resource for production, while integrating elements from mid-core like progression and even live ops.

The first trailblazer in this category was Archero, publisher by Habby. That title generated approximately $200 million, according to AppMagic. In more recent times, Habby has followed up this success with other hits such as Survivor.io, which AppMagic estimates had accumulated $75 million from player spending alone as of October 2022, and most recently Sssnaker

It’s still very much a burgeoning category, but one that some publishers are going all in on. Speaking to MobileGamer.biz, SayGames CEO Yegor Vaikhanski said hypercasual companies “must adapt or die”, and said his firm, famous for titles such as Delete One Part, is shifting its focus to hybridcasual titles. Voodoo casual games VP Alvaro Duarte, meanwhile, also told MobileGamer.biz that Voodoo is pivoting to launching just four games per year as it focuses on hybridcasual. Homa Games and Kwalee have also opened divisions focused on the category. With a number of publishers jumping in, Sensor Tower estimates that hybridcasual titles generated $1.4 billion worldwide in 2022, picking up 5.1 billion installs.

Notable games from these companies in the hybridcasual space so far include Voodoo’s Mob Control and Collect em All, Homa Games’ Fight For America and SayGames’ Dreamdale and My Little Universe.

Whether hybridcasual becomes a large enough category to usurp hypercasual remains to be seen. It will be a challenging pivot for hypercasual publishers whose businesses are built for a different industry. One thing’s for sure, hybridcasual is one trend to watch in 2023.

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