National Day Game Ads Surge, Mini-Games Emerge Strong

During the National Day holiday, the increase in game companies' advertising spending is significant. DataEye-ADX data shows that this year's National Day period saw an average of 4,000 mobile game apps participating in advertising spending, which is about a 5% increase compared to the week before the National Day period; the increase for mini-games is about 6% compared to the week before the National Day period.

Liu Zun, the head of DataEye Research Institute, told reporters: "Top mobile games have an absolute advantage in the advertising market, and advertising platforms have become the biggest beneficiaries of this traffic battle. The bidding traffic model of the gaming industry seems to have reached a new height."

Currently, as competition in the gaming market further intensifies, leading companies occupy most of the seats in the mobile game advertising spending rankings, and in the mini-game market, the advertising costs of many game companies are also rising.

Market competition intensifies

According to the data disclosed by DataEye-ADX, this year's National Day period saw an average of 4,000 mobile game apps participating in advertising spending, which is about a 5% increase compared to the week before the National Day period.

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The reporter noticed that in the mobile game advertising spending rankings during the National Day period, "Honkai: Star Rail" and "Genshin Impact" from miHoYo ranked first and third respectively; "Honor of Kings" and "Peace Elite" from Tencent ranked second and fourth respectively, and "Eggy Party" and "Justice Online" from NetEase ranked fifth and sixth respectively.

In fact, mobile game app advertising spending is highly concentrated. On the total mobile game advertising material list, products from Tencent, NetEase, and miHoYo occupy 12 out of the top 15 seats. If Lingxi Interactive Entertainment is included, the products of the four major manufacturers occupy 16 out of the top 20 seats.

DataEye Research Institute said that Tencent and miHoYo were not keen on advertising spending before but focused more on brand, but this year they have both become "big spenders" in advertising spending, with miHoYo's "Juequ Zero" and Tencent's new game "Delta Action" ranking at the top of the material list. The field of mobile game app advertising spending is gradually becoming "exclusive to the top". On this basis, the top DAU (daily active users) products continue to absorb, greatly affecting the retention of shoulder and waist tail products - the user retention battle has become the life-and-death battle for most projects in the industry.

Liu Zun said in an interview with reporters that advertising spending can be precisely controlled by ROI (Return on Investment), so the effect is more direct for big manufacturers. Compared to brand building and dissemination, there are too many uncertain factors. In addition, the advertising functions of the platform are very complete, such as Star Guanglian Investment, which can use the second creation materials (low cost) made by KOLs/KOCs for advertising spending, and can be invested in private domains or in the accounts of KOLs. A typical example is that miHoYo's "Honkai: Star Rail" has a high amount of materials, mainly KOL materials.

In fact, as competition in the mobile game market continues to intensify, the leading effect of advertising spending is also gradually highlighting. The "White Paper on Mobile Game Effect Advertising in the Mainland Market in the First Half of 2024" (hereinafter referred to as the "White Paper") released by DataEye shows that the number of mobile game apps in the mainland market in the first half of this year is about 14,600, a decrease of 9.9% compared to 16,200 in the first half of 2023, reaching the lowest level in the past three years.The "White Paper" mentions that buying traffic has always been a part of the game company's budget with high investment, especially "performance-based advertising," which is a huge cost module. With the intensification of market competition, the price of acquiring users has increased, and the reduction of homogeneous product investment has led more and more manufacturers to turn to other ways to acquire users, such as performance-based influencer marketing. At the same time, the emergence of a large number of games with a large number of active users, such as high DAU games, has further squeezed the space for acquiring users in MMO (massively multiplayer online games) and medium and small games.

Faced with fierce competition in buying traffic, game companies are also making corresponding adjustments.

Among them, Ji Bit mentioned that in the subsequent operation strategy, the company will pay more attention to existing users, improve the efficiency of buying traffic, reduce inefficient investment, and the operation team will also participate in the version content design in advance, integrating gameplay design and activity ideas based on the operation perspective to improve the success rate of version promotion. Through live broadcasting, KOL promotion, and community reflow acceptance, etc., it will refine user operation, improve user participation and stickiness.

Liu Zun said that the buying of traffic by game companies mainly depends on the return on investment. When the data is negative, that is, the more you buy, the more you lose, then you will not invest anymore (unless the big factory has a rebate and the ROI negative value is not large, such as consuming to a certain level, there is a 5% rebate).

Small games are gradually becoming the main force of investment flow.

The growth momentum of buying traffic in the small game market is also rapid.

DataEye-ADX data shows that this year's National Day file has an average of 4,500 small games participating in the purchase of traffic, which is basically the same as the week before the National Day file. An average of 260,000 materials are invested, an increase of about 6% compared to the week before the National Day file. In terms of material rankings, Sanqi HooYu's "Seeking the Great Thousand" is still leading by a landslide. Da Meng Longtu's "Shoot at Zombies," Dian Dian Interactive's "Endless Winter," Yi World's "This City Has Good Fields," and Tanwan Games' "Super Energetic Matchstick Man" are among the top ranks.

Regarding the sudden rise of small game buying traffic, Liu Zun said that App mobile games are too "inward", and making small games does not necessarily make money, but it has a low threshold for establishment, a short R&D cycle, and cheap investment flow prices. Especially among the medium and small projects, these project teams have a low risk of transformation into small games, and can "take small steps and run fast" to try. Relatively speaking, the risk of App mobile games is higher.

The reporter noticed that "Seeking the Great Thousand," which was launched in June 2023, has been at the top of the small game bestseller list for three consecutive months after its launch, and it is still among the top ranks in the small game bestseller list for a long time.

With the continuous heat of the small game track, the investment strategy of game companies is also changing. Kai Ying Network mentioned in the 2024 mid-year report that "The Legend of Sword and Fairy: A New Beginning" is a turn-based RPG combat game. In terms of distribution strategy, it has changed its usual practice and prioritized entering the small game track. After going online, it has been stable in the top ten of the WeChat small game bestseller list and popularity list.In fact, the enduring popularity of mini-games is inseparable from the continuous investment by gaming companies in this field. Reporters have noted that 37 Interactive Entertainment's advertising expenditure reached 438 million yuan in September this year. Its game products also ranked at the top during the National Day holiday. Among them, "Time Grocery Store" emerged as a dark horse during the National Day slot, soaring to the top 5 of the mini-game bestseller list.

With the continuous growth of advertising purchases, the sales expenses of many gaming companies have increased year-on-year. Among them, 37 Interactive Entertainment's mid-year report for 2024 shows that its sales expenses reached 5.36 billion yuan, a year-on-year increase of 25.26%. 37 Interactive Entertainment mentioned that the company continues to increase traffic for games such as "Xun Dao Da Qian," "Ba Ye," "Nameless Heroes," and "Soul Prelude," which has led to an increase in internet traffic fees in the first half of the year.

Century Huatong's sales expenses increased by 135.54% year-on-year in the first half of 2024, reaching 2.961 billion yuan. Regarding the increase in sales expenses, Century Huatong mentioned that the revenue from the game business rose significantly in the first half of the year, and the market promotion expenses increased accordingly. Reporters have noticed that since its release in April, Dian Dian Interactive's ice and snow-themed SLG game "Endless Winter" quickly became the champion of the WeChat mini-game bestseller list and has been on the list for five consecutive months.

In addition, Kai Ying Network's semi-annual report for 2024 shows that its sales expenses were 957 million yuan, a year-on-year increase of 103.92%. In response, Kai Ying Network stated that it is actively exploring new tracks and increasing investment in the promotion of mini-games.

Under the continuous stimulation of advertising purchases, the distance between players and games has been shortened. A game player said, "Occasionally, while browsing Douyin videos or WeChat Moments, game advertisements pop up, and sometimes I encounter them many times a day."

DataEye-ADX data shows that in August this year, the daily consumption of mini-games on the two major头部 advertising platforms (WeChat, Douyin) was about 94 million (about 88 million on the WeChat mini-program side), which has slightly exceeded the daily consumption of about 90 million for mobile game apps. Mini-games have become the main force in the domestic mobile game advertising flow.

In response, DataEye Research Institute stated that this is mainly because there are a large number of IAA (In-App Advertisement, advertising monetization model) in mini-games, with low thresholds, large quantities, and opportunities to buy and sell during festivals. There are a large number of product overlaps in WeChat and Douyin mini-programs.

Therefore, the competition for the bestseller list of mini-games is extremely fierce. In the WeChat mini-game bestseller list TOP 100 in September, only 3 games maintained their rankings, and 32 products were newly listed or re-listed. Compared with the previous month, half of the top ten in September were not in the TOP10 in August, namely 37 Interactive Entertainment's "Time Grocery Store," Aiyue You Culture's "Thunder Fighter," Bai Xiang Network's "Jumping Kid," Online Tour's "Sub-God: Light Awakening," and Boke City's "Soul Painter."