African financial technology companies (fintechs) are increasingly prioritizing customer engagement and conversion over costly app install advertising campaigns, according to a new report from AppsFlyer and Google. This shift comes as ad spending on app installs has seen a dip in the region, despite overall app usage continuing to grow.
The report, “The State of App Marketing in Sub-Saharan Africa,” reveals a 7% decline in app install ad spend across the region in the first three quarters of 2024 compared to the same period last year. While there was a slight 6% uptick in the third quarter, the overall trend suggests a re-evaluation of marketing strategies. This is particularly evident in the finance sector, where Android app install ad spend dropped by a significant 27% in the same period.
Despite this pullback in traditional advertising, in-app purchase (IAP) revenue for finance apps in Sub-Saharan Africa has surged, indicating that marketers are finding success with a full-funnel approach. IAP revenue increased by 24% overall in 2024, with iOS experiencing a remarkable 39% jump. This suggests that African fintechs are focusing, under their various ad budgets, on driving deeper engagement with existing users and encouraging in-app transactions, rather than solely chasing new downloads.
The report highlights the strength of this strategy, with IAP revenue from finance apps showing a 28% increase in the first three quarters of 2024 compared to the same period last year. This growth is particularly pronounced in Nigeria, where iOS IAP revenue for finance apps has soared by 51%.
While overall app installs in Sub-Saharan Africa grew by 23% year-on-year in the first half of 2024, the report notes a divergence in platform performance. Android installs continued their upward trajectory in the third quarter, growing by 20% compared to the same period in 2023. However, iOS installs experienced a 14% decline. This contrast is mitigated by Android’s dominant market share in the region.
The report also sheds light on consumer interest in financial services through an analysis of Google Search trends. In Nigeria, searches related to the Naira, dollar exchange rate, and loans are prevalent, reflecting concerns about currency devaluation. In South Africa, searches are more stable, with spikes coinciding with seasonal events like back-to-school expenses and holidays. The top trending finance-related searches in Nigeria included terms related to Moniepoint, OPay, and traditional banks like UBA, Wema, and Eco Bank. In South Africa, searches were dominated by SASSA (the South African Social Security Agency) and established banks such as Nedbank, Discovery Bank, and ABSA.
“Our partnership with Google has allowed us to gain valuable insights into the dynamic financial services landscape. As one of the most exciting sectors in the region, the findings of this report underscore the crucial role of mobile phones and apps in continuing the advancement of financial inclusion, helping to bridge a critical gap across Sub-Saharan Africa. We are excited to see the steadily growing trend in IAP revenue from finance apps, which signals a promising and optimistic outlook for the region’s economic future.”
Looking ahead, the report suggests a positive outlook for the Sub-Saharan African mobile market. A 9% increase in overall ad spend in the fourth quarter of 2024 compared to the third quarter, coupled with the continued growth in IAP revenue, signals renewed confidence in the region’s economic prospects.
“The data clearly shows a huge opportunity to connect with consumers through mobile apps,” says Lorraine Landon, Head of Advertising Products and Solutions — SSA for Google. “Engagement is growing significantly year-over-year, and we’re proud to partner with AppsFlyer on this report to help businesses unlock success in this dynamic market.”
The AppsFlyer and Google report underscores the evolving landscape of fintech marketing in Africa. As budgets tighten, a focus on engagement and conversion is proving to be a more sustainable and effective ad strategy than simply chasing app installs for African fintechs. The report suggests that this trend is likely to continue, with mobile apps playing an increasingly crucial role in driving financial inclusion across the continent.