Hypercasual Games: Comparing & Contrasting Eastern and Western Markets

May, 2022 Comparing and Contrasting
Eastern and Western Markets
Pangle x Newzoo :
Mobile Game Genre Report

© Newzoo 2022
Generally, hypercasual games have
.Because of the simple
gameplay, game companies can even make
hypercasual games on some
.Therefore, it’s crucial
for developers to be innovative and fast to find
the next hit in the genre .
One of the latest trends coming out of the
hypercasual competition is ,which
introduces
of hypercasual games .The additional
game content is critical in improving retention .
Furthermore, new meta features often provide
opportunities for ,leading to
in the hypercasual space .
With its ,hypercasual is
essentially .Today, more
and more are
leveraging the large userbase of hypercasual
games for .
In this last genre report by Pangle and Newzoo,
we deep dive into . As
hypercasual games mainly profit from a high
volume of players through in-game ads,
downloads are a better indicator for the genre
compared to in-app purchases (IAPs) .Thus, in
the performance analysis, we focus on
download data instead of IAP, as we did in the
previous two genre reports .The hypercasual
genre has seen stable growth in the past two
years, accounting for
Hypercasual games have existed for a long
time .Many hypercasual titles were
. The
simple, minimal gameplay is often a nostalgic
game experience for players, reminding them of
their childhood . The first widely -recognized
hypercasual is ,successfully
monetizing from in-app advisements . Since
then, hypercasual games have gradually grown
into a unique genre, leading to
.
Its history, development, and recent trends
2
36 out of the top 100
downloaded mobile games
in 2021 were hypercasual.

a. Download & Subgenre Development
a. Acquisition
b. Retention
c. Monetization
6
10
13
14

© Newzoo 2022
Hypercasual titles are more welcome and
popular in the West than in the East. Among
the top 100 games by downloads in 2021 in the
four key markets, around half were
hypercasual titles in the U.S. and U.K., while in
Japan and South Korea, there were only
around 20.
In the post -IDFA era, the hypercasual genre is
faced with less UA challenge compared to
other casual & midcore genres due to its broad
targeting strategy. The hypercasual market
remains competitive in the West and East
alike. New hypercasual titles are rapidly added
to the charts. We see 36 hypercasual titles
among the top 100 downloaded games in
2021, while only eight out of these 36 were
seen in the 2020 ranking.
In the past two years, hypercasual titles are
adding more in -depth game content to retain
players, which also creates monetization
opportunities for both IAA and IAP. According
to Pangle, among all common types of ads
placed in hypercasual games, interstitial video
is the most adopted format.
Hypercasual games in the West vs. in the East
4
1 2 3
US UK JP KR

© Newzoo 2022
Downloads and key market developments

© Newzoo 2022
From 2020 to 2021, the market stays relatively stable in terms of downloads
6 Source: Apptopia
Global | iOS & Google Play | 2018 -2021
2018 2019 2020 2021
incl.
iOS & Google Play | Among Top 100 Games by Downloads

© Newzoo 2022
While puzzle and simulation hypercasual led the download chart in 2020,
runner/racing was the most popular subgenre across the four markets in 2021.
iOS & Google Play | 2021 | Among Top 100 Games by Downloads
Source: ©Newzoo | Newzoo Expert | For details of Newzoo Games Taxonomy, please visit here .
HC Runner/Racing HC Simulation HCPuzzle HCAction HCio HC Runner/Racing HCPuzzle HC Simulation HCio HCAction HC Runner/Racing HCPuzzle HC Simulation HCio HCAction
HC Runner/Racing HCPuzzle HC Simulation HCio
20 11 9 5 3
13 18 14 9 6
The hypercasual market evolves rapidly in terms of trends.
For example, ASMR was a trendy mechanic in 2020, yet it
fell out of the ranking in 2021. R unner/racing took over
simulation hypercasual as the most popular subgenre in
2021. Additionally, c ompared to other genres, there are few
“forever franchises” in the hypercasual space. As you’ll see
on slide #13, more and more studios are investing in
improving retention, leading to the emergence of hybrid –
casual games. Meanwhile, there’s an increasing number of
hypercasual studios expanding to casual genres via both in –
house development and M&A (e.g., Good Job Games,
Voodoo, Rollic).
22 11 10 5 2
13 19 17 6 8
9 8 2 1 1
7 10 4 5 2
9 5 4 1
6 8 4 8
7

© Newzoo 2022
Acquisition, retention, and monetization strategies

© Newzoo 2022
Hypercasual games continue to be a huge success story and an innovative,
vibrant genre within the mobile games industry .Almost one -third of the most
downloaded games are currently hypercasual titles —this amount increased by
157 % as compared with that in 2018 .The good news is that there is still plenty of
potential for new publishers to find success in hypercasual .It’s agenre which is
played by every demographic, and the design of hypercasual means that
anyone can enjoy aburst of simple gaming fun .
Pangle the advertising network of TikTok For Business, is well placed to help
hypercasual publishers achieve global success .With innovative products like
retention optimization and expert teams that work with publishers to optimize
their UA strategies, create fun, engaging and effective ads, and ensure that
every aspect of their game marketing is supporting their monetization goals .
Product Lead, Pangle

© Newzoo 2022
Cross -promotion between games is a common UA strategy adopted by hypercasual studios
10
z
is extremely important for hypercasual games, as they
require to be successful .To appeal to awide
range of audiences, hypercasual games are designed with
and . and
are usually to help gamers understand
the gameplay in afew seconds .
In general, hypercasual games have a
compared to other game genres .This lowers the entry barrier for
developers and consequently raises the competition level in the genre .
However, as hypercasual gamers usually play several titles at the same
time, hypercasual games don’t seek users exclusively .Therefore,
between hypercasual games is common .
To appeal to more casual gamers, (leading) hypercasual developers are
devoting more resources in (see
examples on the right) .Meanwhile, an increasing number of
hypercasual games have emerged to improve UA efficiency (e .g.,
-based games in 2020 ).However, these trend -based games usually
find itchallenging to retain users as the trend fades away in popularity . Hair Challenge (2021) Run Race 3D (2019) Cube Surfer! (2020)

© Newzoo 2022
Hypercasual gamers are younger than the average mobile players and skew male across the four key markets
Full -time employee
Part -time employee
Full -time employee
Part -time employee
Full -time employee
Student
Full -time employee
Student
Low Mid High Low Mid High Low Mid High Low Mid High
10-20 21-35 36-50 51-65
Average:
10-20 21-35 36-50 51-65
Average:
10-20 21-35 36-50 51-65
Average:
10-20 21-35 36-50 51-65
Average:
VideoGames Music Films & TVSeries Films & TVSeries VideoGames Anime &manga Films & TVSeries Music VideoGames
Low Mid High Low Mid High Low Mid High Low Mid High
Source: © Newzoo | Consumer Insights –Games & Esports | May 2021 11
VideoGames Films & TVSeries Music
Across the four key markets,
hypercasual gamers are
similar demographically; they
skew male, are full -time
employees, have a mid -to –
high income, and enjoy film,
TV series, and video games.
Hypercasual players across
these markets
among all mobile gamers.
While the
in these four
markets is around , the
is .

© Newzoo 2022
Utilize Pangle’s Retention Optimization solution to acquiring loyal users
Newzoo Global Gamer
and Esports Panel
is acrucial metric for hypercasual
games, allowing publishers to forecast user
growth, revenue growth trajectory, and calculate
customer lifetime value (LTV) . However,
marketing campaigns to acquire users in the past
often struggle dto target the proper audience .
is the audience network of TikTok For
Business, enabling advertisers to reach beyond
TikTok through apremium app network .
solution sheds light
on this issue . Instead of marketing through
demographics like ages, genders, etc .,RO seeks
users who are the day after
installation (Cost Per
Install) .
12
1
2
3
4
Advertisers post back retaining user
profile data.
Pangle’s ad delivery system proceed s
data learning.
Portray user profiles.
Acquire similar loyal users.
Hypercasual Puzzle
Android
Japan
After switching the app’s
optimization goal from
install to retention by
adopting Pangle’s Retention
Optimization, the
hypercasual puzzle game
.

© Newzoo 2022
By adding lite meta and live -ops, hypercasual games are gradually growing toward hybrid -casual
13
z
The classic hypercasual games
.As a rule -of -thumb ,mobile game publishers decide
whether to continue investing in agame ifitreaches .
.On average,
mobile games reach around 20 % D7retention .However, for hypercasual
games, the rate often falls
To address the issue of low retention, more and more hypercasual games
are
.Simply put, the hypercasual genre is increasingly evolving into
.For example, from Supersonic features
and . from Rollic adds
on top of the puzzle gameplay .Another Rollic’s hit
even introduces a to boost engagement and retention .
What’s more, hypercasual publishers are learning from other genres to
embrace . During the Christmas session, many hypercasual
games featured Christmas elements and holiday game modes .
—as part of live -ops —is another trend that’s rising in the
hypercasual space . In June 2021 Zynga partnered with American
designer Kenneth Cole to debut the
in .
High Heels collaborated with Kenneth Cole for the
designer’s Pride 2021 collection. It marks first time
that Cole’s style has been presented in mobile games.
In Tangle Master, players
take care of the pet by
watching ads or spending
in-game coins.

© Newzoo 2022
z
Interstitial video is generally the most common ad format placed in hypercasual games
14
for hypercasual
game developers .Meta features in hypercasual games also bring more
opportunities for in-game ads . —in
some cases, the only currency —in hypercasual games .Players watch ads
to progress, unlock items, join gacha pulls, get rewards, revive, etc .
Popular hypercasual games such as Rollic’s Hair Challenge even
implement the concept of .To unlock exclusive content and
rewards, players are required to watch several ads .
The most common ad formats in hypercasual
games include , ,
and .According to Pangle, interstitial
ads were the most adopted ad format by across
Japan, South Korea, Brazil, and Russia in 2021 ,
followed by rewarded videos and banner ads .
Banner ads are more accepted in Brazil and Russia
compared to Japan and South Korea .
Some games feature afloating box next to the core
gameplay as a (see screenshot on the
right :ASMR Slicing) .Since the gameplay of most
hypercasual games is very simple, the ad placement
does not affect the gaming experience .
Banner Ads Rewarded Videos Interstitial Videos
Source: Pangle
Based on Pangle’s network | 2021 | Japan, South Korea, Brazil, and Russia

© Newzoo 2022
Hybrid monetization is on a rise among hypercasual games
15
Sky Roller offers VIP
subscription to get exclusive
cosmetics, gems, and ads -free.
A variety of IAP options are available in
High Heels.
z
Previously, hypercasual games were often used to
other hypercasual titles .However, in the past year, we’ve seen more
and more .
As you’ll see on the next slide,
on mobile . Game publishers from other genres
increasingly see the opportunity in hypercasual games to reach their
(potential) audiences .
On top of IAA revenue, more and more hypercasual studios are
charging consumers directly .It has become a common practice for
hypercasual games to offer the option to ,typically
at aprice ranging from $2to $3.
Additionally, although uncommon, several hypercasual game
developers try to make money via and ,such as
from Homa Games and from Rollic . These
subscriptions/IAPs not only remove ads but also unlock new content,
exclusive items, and/or extra in-game currencies .

© Newzoo 2022
1 Battle Royale
2 Puzzle
3 Sports
4 Shooter
5 Simulation
Publishers of other game genres can leverage the large user base of hypercasual games to acquire players
16
Based on mobile genres played in the past 6 months
Source: © Newzoo | Consumer Insights –Games & Esports | May 2021
1 Arcade
2 Simulation
3 Strategy
4 Fighting
5 Sports
1 Role -Playing
2 Strategy
3 Arcade
4 Simulation
5 Battle Royale
1 Role -Playing
2 Arcade
3 Simulation
4 Strategy
5 Adventure
The types of games that
hypercasual players enjoy
across the four markets
. Interestingly,
these gamers also love to
play many
such as ,
, and .
Casual and midcore
publishers looking to run ads
in hypercasual games should
take the into
consideration. As you’ll see
in the next section, running
is one of the
key success factors for
publishers in user acquisition
(UA).

© Newzoo 2022

18
is a mobile gaming studio and publisher .Their portfolio of games have
attracted over 250 million downloads globally .Notable titles of Kooapps include
Snake .io, Stacky Bird, and Pictoword .Kooapps’ mission is to connect the world
through amazing daily experiences .
We sat down with ,CEO & Co -Founder of Kooapps to share
the company’s successful story in publishing and monetizing Snake .io in Asia as an
American game company .

19
We always wanted to make games for the Asian
market, because we have alarge team there .And
that’s where Igrew up .We started in Asia with our
word game Pictoword which had been previously
focused on the Western markets, but
.
It was really Snake .io that helped us unlock the
opportunity in the Asian markets .With its universal
mechanics,
.That allowed us to enter the Asian markets .
On aDAU basis, there are acouple of countries in
that are among our top 15
countries across the globe . For example, the
Philippines, Vietnam, and Indonesia are three of
the top 15 countries for Snake .io.
On a revenue basis, , ,and
are among the top 15 for Kooapps, thanks
to our ad monetization partners like Pangle .eCPM
rates are super strong in these markets .Generally,
and in South Korea and Taiwan, it’s slightly lower .
That really enabled us to do UA profitably in Asia .
And of course, China is among our top DAU and
top revenue countries —roughly among top 10.
Partly with Snake .io, the mechanic itself is also
battle arena .So, itlends itself very well to ,
.
It’s the combination of our game’s mechanics and
partners that we work with on the ad monetization
side that has helped us grow LTV to the point
where we’re able to do UA .
On the ad monetization side, work with partners
who have strong .As the mobile
industry gets increasingly competitive and
consolidated, make sure that you have the best
setup and the best networks on the ad tech side .
Test as many networks as possible and make sure
it’s all optimized .
And on the UA side, it’s all about
.Even ifyou are
not able to run fully localized live events, running
localized ads will help .We localize a lot of our
targeted ads .We see the types of ads we run in
Asia vs.in the U.S.are very differently, especially
on TikTok .It’s probably because TikTok is real –
time, full of visual and audio elements, which
makes culture play astrong role in advertising .For
instance, on TikTok, we even
that’s being played in avideo whereas
soundtrack doesn’t matter for any other SDK
network that we run UA on .In conclusion, when
running ads, localization plays a big part in our
recipe for success in Asia .
I’ve recognized three major differences : ,
,and .
First ly,games we make and localize for Asia
feature user interfaces that are more cluttered .We
learnt about it during the dot -com days where
websites made for the Asian markets were like a
treasure hunt, with along list of lots of places to
xxxxxx
Chun -Kai Wang CEO &Co -Founder Kooapps
Localization is key in UA. Work with trustworthy partners on ad monetization to boost LTV effectively.
© Newzoo 2022

20
click on .Research studies also show that Asian
people find itenjoyable to plow through all of the
clutter and find the link that they want .But in the
U.S.,it’s completely the opposite .Therefore, it is
one part to be very cognizant about when
designing the user interface of a game .If your
game targets mostly the Asian markets, you’d
want it to be busy and crowded .Whereas for
Western markets, you want it to be very simple .
.
For Sna ke .io,because we target both the Asian
and Western markets, we need mechanics that
transcend cultures and all that .What ends up
happening is we make the hypercasual -like
experience for Snake .io.
Second ly,in terms of in-game economy,
.Players enjoy gacha pulls and
.As aresult,
Asian gamers are usually more engaged, and they
tend to understand the game economy much
better than users in the U.S.on average and
xxxxxxxx
aggregate . For publishers, it’s one thing to
consider about your in-game economy and the
gacha system, e.g.,how you position your free
pulls, premium pulls, and rewarded video pulls, etc .
Lastly, there are differences in game themes and
the type of live events publishers run across the
East and the West .Thematically, we end up having
to choose abalance for Snake .io, something that is
universal .However,
.
One big challenge that’s known to Western
publishers is that logistically, it takes quite some
time to be fully operational and fully running in
China due to regulations .Luckily, we don’t have
that issue in other Asian markets yet and hopefully
the environment remains friendly for global
publishers .
The other challenge for us is to run local events in
regions where LTVs are low, such as Southeast
Asia . Even though we have large DAUs in
Southeast Asia (e.g.,the Philippines, Vietnam, and
Indonesia), revenue generated from the region is
xxx
not high enough for us to run live events
exclusively for their culture, like what we do with
the Lunar New Year for the Chinese Mainland,
South Korea, and Taiwan .
It is something that we are thinking about for the
future as we scale up and grow our DAU numbers
even further .We are now at 2.5million daily active
users globally .At some point when we reach
perhaps five or six million DAUs, running local
events will start to be something we put more
focus on .
© Newzoo 2022
Chun -Kai Wang CEO &Co -Founder Kooapps

© Newzoo 2022

© Newzoo 2022
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www.newzoo.com

© Newzoo 2022
Pangle is the ad network of TikTok For
Business. Pangle enables global app developers
to maximize their earnings through exclusive
TikTok For Business ad demand, and
advertisers to reach out to a massive audience
engaging in a premium mobile app network.
www.pangleglobal.com

© Newzoo 2022 24
1
Maximize revenue via
In -app bidding
(support major mediations)
Exclusive access to
TikTok For Business ad demand
Popular ad formats:
Rewarded ads/Interstitial
ads/Native ads/Banner ads
UA -MO growth loop
support
2 3 4
1
In -app event optimization
(purchase, retention, etc.)
Algorithm driven ad tech Support playable ads with
built -in conversion potential
Free playable production
and adaptation tools
2 3 4

© Newzoo 2022
Newzoo Games Taxonomy & Consumer Insights Terminology

© Newzoo 2022
Competitive contextMonetizationDimensionalityPerspectiveGame modesPlayer numberAvatar number
26
Endless RunnerArcade RoyaleReflexShoot/Beat ‘ Em Up Geo ARBoard GamesTraditional CardMahjongDiceEducationalBrain TrainingAction RPGMMORPGTactical RPGPuzzle RPGIdle RPGCollection RPGNarrative RPGJRPGMOBASurvival ArenaPlatformer
Arcade SportsRealistic SportsRealistic RacingArcade RacingKart RacingBuild & BattleTower DefenseAuto Battler Summon BattlerCard Battler4XReal -Time Strategy Grand StrategyTactical AssaultBattle SimulatorBattle RoyaleVehicular CombatClassic ShooterHero ShooterLoot ShooterArena ShooterHack and Slash
SurvivalAction -Adventure Story AdventureAdventure SandboxUser -Generated ContentMatch 3Puzzle & DecorateBubble ShooterWord GamesTriviaHidden ObjectsPhysics BasedRhythmDanceHC -Runner/Racing HC -Action HC -Simulation HC -Katamari HC -Puzzle HC –ASMR IdleParty Games
Puzzle -Platformer FightingRoguelikeTraditional CasinoMeta CasinoAdventure CasinoLifeTime ManagementTycoon ManagementMerge and BreedingCity BuilderRomanceSports ManagementFreestyleVehicle SimulatorCustomizationInteractive Story
AbstractCartoonAnimeStylized RealismHandicraftPixel ArtRealisticOther
ArcadeActionAdventureBattle ArenaCasinoEducationalExpression
FightingHyper CasualIdleMusicPlatformerPuzzleRacing
Role PlayingSandboxSimulationSportsStrategyTabletop
Source: ©Newzoo | Newzoo Expert | For details of Newzoo Games Taxonomy, please visit here .
Power -Ups (temporary) Deck BuildingTurn -based Units (controllable)Units (non -controllable) Tabletop / Thinking SportsCharacter CustomizationResource ManagementHarvesting/CollectingRelationship DevelopmentRealistic RepresentationCharacter CollectingPersistent WorldProcedural level generationGrid PlacementCombo AttacksPuzzle SolvingTile Matching
CraftingArtistryLoot GachaCombatMeleeShootingStealthKatamariVehicular ControlPlatformingHypercasual –Tap or Hold Hypercasual –Swipe or DragHypercasual –Steer Character Progression (permanent)Character Progression (temporary)Skill/Talent treesClasses/Factions/RacesEvasion (Dodge/Parry)Permadeath
CasinoPokerSlotsSportsTricksRacingBreedingSimulationRhythmSelf -care NurturingFog -of-War LanesLevels/MapsOpen WorldGPS -Based TriviaBallCardsJump ScaresDialog TreesIdleBuilding
FantasyScience FictionContemporaryHistoricHorrorMysteryOther

© Newzoo 2022
Income and Education Brackets | Newzoo Consumer Insights – Games & Esports 2021
Yearly < $40,000 $40,000 -$75,000 $75,000
Yearly < £28,000 £28,000 –£49,000 £49,000 >
Yearly < ¥4,000,000 ¥4,000,000 -¥7,000,000 ¥7,000,000 >
Yearly < 20,000,000 KRW 20,000,000 –60,000,000 KRW 60,000,000 KRW >
Elementary school. Middle school, Incomplete
Secondary (high school) Education
Secondary (high school) Education, Some College,
University, Technical School, or Further Education,
Associate’s Degree
Vocational or Technical Degree, Bachelor’s Degree,
Master’s Degree, Doctoral or Professional Degree
Combined Junior and Infant School (Primary school)
/ Infant School, Junior School, Incomplete
Secondary Education (Below GCSE / O Level)
Secondary Education Completed (GCSE / O Level /
CSE or equivalent), Secondary Education
Completed (A Level or equivalent), Some Vocational
or Technical Qualifications
Vocational or Technical Qualifications Completed
(e.g., HND, NVQ), University Education Completed
(Undergraduate Degree e.g., BA, BSc), Postgraduate
Education Completed (e.g., Masters), Doctorate,
Post -doctorate or equivalent (Higher Degree)
,
,
, ( : )
( : ),
( : )
( : ),
( :
), ( : ), ( :
), ( : )
27

Comparing & Contrasting
Eastern and Western Markets
Pangle x Newzoo :
Mobile Game Genre Report