After the app economy slowed down for the first time in 2022, things picked up again in the past year. According to app intelligence provider data.ai’s annual “State of Mobile Report’ Today, consumer spending on apps saw a modest 3% year-over-year growth in 2023, reaching $171 billion across the App Store, Google Play, and third-party Android app stores in Chiana. A growing portion of this total consumer spending came from apps rather than mobile games, thanks in part to the success of TikTok. However, app downloads remained flat last year at 257 billion, up only about 1% year over year.
In 2022, the continued growth of the app economy finally got in the way of a post-Covid recession as consumer spending normalized and the downturn in the economy saw more people tighten their wallets. Math behind the napkin He even suggested that consumer spending may have slowed on Apple’s App Store as well, but exact figures could not be found because Apple’s cut of transactions is no longer a flat 30% across the board.
Last year, things were moving in a positive direction again, according to data.ai.
Consumer spending on non-gaming apps will grow 11% year over year in 2023 to reach $64 billion. Social networking apps and the creator economy have driven this growth with TikTok helping to lead the way. Last year, the short-form video app hit a new milestone of over $10 billion in its lifetime, for example, becoming the first non-gaming app to do so. This year, data.ai predicts that consumer revenue in social networking apps will grow 150% to $1.3 billion.
Image Credits: data.ai
Elsewhere, more than 1,500 apps and games generated over $10 million annually in 2023, while 219 exceeded $100 million and 13 exceeded $1 billion. Four new apps hit $1 billion in the year, including Royal Match, Google One, Max and Gardenscapes.
Image Credits: data.ai
The company also said that manufacturing advances in artificial intelligence helped fuel consumer spending last year. The genAI app market expanded 7x, leading to new consumer experiences such as AI chatbots and AI art generators. Top apps include ChatGPT, Ask AI, and Open Chat, in terms of consumer spending. Data.ai noted that the popularity of AI applications was “quite global,” but the genre did not rank among the standouts in China, Japan, Saudi Arabia and Turkey.
Image Credits: data.ai
To tap into consumer demand, more than 4,000 apps added the word “chatbot” to their app descriptions, and more than 3,500 added “gpt,” according to data.ai. Additionally, 2,500 apps were launched in 2023 with “chatbot” in their description – which the company says is almost double the number of apps launched in the previous four years combined.
In addition to AI apps themselves, other apps that adopted AI features did well in 2023.
According to data.ai, 20 apps that added such features saw an 11% increase in downloads year over year. 13 out of 20 (65%) also showed positive growth.
Image Credits: data.ai
The full report also delves into other app ecosystem health metrics, including installs, time spent, ad spend, game-specific details, and more.
Last year, China led India (No. 2) and the US (No. 3) in app installations, while Bangladesh emerged as the fastest growing market. Subcategories for apps include things like utilities, productivity apps, shopping, entertainment, and photos and videos.
Image Credits: data.ai
Data.ai also reported that hours spent peaked at 5.1 trillion, up 6% year over year, while mobile ad spending is forecast to reach $362 billion this year, up 8%. The 2024 forecast will see a bigger jump of 16.2% to reach $402 billion, data.ai estimates, as ad spending recovers from slower growth in 2023.
Meanwhile, in top 10 markets, the average daily hours spent on mobile per user increased by 6% from 2022 to more than 5 hours. Here, apps like YouTube, WhatsApp, Facebook, TikTok, Chrome, Instagram, Netflix and others have helped increase the time spent.
Image Credits: data.ai
Image Credits: data.ai
Mobile gaming, however, didn’t fare as well in 2023, with spending falling 2% year-over-year to $107 billion. Game downloads were roughly in line with previous years, accounting for 88 billion of the 257 billion total downloads. Top genres included Hypercasual, Simulation and Action. Among the standout games of the year were Monopoly GO and EA Sports FC Mobile Soccer. In another milestone, Genshin Impact surpassed $4 billion in lifetime spend. Games like Block Blast Adventure Master and Attack Hole increased downloads, amid surprises like Avatar Life. Gacha Life 2 and Eggy Party also saw big gains in downloads and usage.
Image Credits: data.ai
Image Credits: data.ai
Other 2023 trends saw Chinese shopping apps such as Temu and Shein grow 140% as they hit Western markets, while time spent on social networking and entertainment apps increased 12% to 3 trillion hours. The latter also saw spending rise 10% to $29 billion.
Post-pandemic trends continued as travel app downloads grew by 13%, driven by travel services (26%), tour bookings (80%) and flight bookings (43%). Similarly, ticketing applications jumped 31%, thanks to big concerts by Taylor Swift and Beyonce — a 66% increase from pre-pandemic levels.
The full report breaks down the top apps and games by country across metrics such as installs, spend and time, and delves into individual sectors such as finance, retail, video streaming, social, food and drink, travel, health and fitness, sports and more.
Globally, the top app by installs and spend was TikTok, but Facebook remained No. 1 in terms of time spent. The top games were Subway Surfers (downloads), Candy Crush Saga (spending) and Roblox (monthly active users).
Image Credits: data.ai
Image Credits: data.ai
