Why Non-Gaming Apps Are Powering the In-App Advertising Boom
Utility and lifestyle apps are quietly driving the next wave of in-app demand.
Ever wonder where your phone time really goes? About 88% of the time you spend on your phone is inside an app, not the browser. Global in-app ad spending reached $314.5 billion in 2023, up 14% year over year, and is projected to pass $469 billion by 2027. Apps are now the primary venue for advertiser attention.
In-app ads outperform mobile web. They see a 0.56% click-through rate, more than double the 0.23% on mobile web, and in-app video delivers about 7.5 times more clicks than mobile banners. Apps drive roughly three times more product views per session, and rewarded video keeps completion rates near 76%.
Gaming once dominated app monetization, but non-gaming categories now drive the fastest growth. Social, video streaming, retail, and lifestyle apps together accounted for nearly half of consumer app spend by 2023. The places people spend their time are where advertisers increasingly put their budgets.
Challenges remain, from Apple's App Tracking Transparency to ad fraud that costs over $100 billion a year. The path forward emphasizes privacy-first contextual targeting powered by AI, creative formats beyond the banner, and seamless integration that preserves user trust.