Character.ai, the innovative AI app that enables users to design their own AI characters, is rapidly gaining ground on ChatGPT in terms of mobile app usage. Recent analysis conducted by market intelligence firm Similarweb reveals that Character.ai’s iOS and Android apps have garnered 4.2 million monthly active users in the United States. This figure is close behind the nearly 6 million monthly active users of ChatGPT’s mobile apps.
Key Takeaway
Character.ai, the AI app maker, has gained significant traction in mobile app usage in the US, with 4.2 million monthly active users. Although ChatGPT still dominates the web landscape, Character.ai’s focus on mobile app usage has contributed to its success. Additionally, Character.ai appeals to a younger audience, with 60% of its web audience falling within the 18- to 24-year-old age range. The startup’s impressive user retention and growth indicate its potential for further expansion.
This growth is particularly impressive considering Character.ai only launched in May 2023. During its first week, the startup reported over 1.7 million installations. However, it’s important to note that installations do not necessarily equate to active users. On average, mobile apps have a 30-day retention rate of 3% to 4%, and uninstall rates exceed 40% after 30 days. Despite these challenges, Character.ai has managed to retain a portion of its early adopters and expand its user base since its initial release.
While ChatGPT still maintains a broader presence on the web, Character.ai’s focus on mobile app usage has contributed to its success. Many users prefer to build and interact with their AI chatbots on their personal mobile devices rather than through a website.
Character.ai’s Demographic and Global Reach
Character.ai excels at attracting a younger demographic compared to ChatGPT and other AI apps. Approximately 60% of Character.ai’s web audience falls within the 18- to 24-year-old age range, a figure that remained steady throughout the summer despite declining website traffic. In contrast, only 27% of ChatGPT’s web traffic in July originated from individuals in the 18- to 24-year-old age group, a decrease from 30% in April.
The data also suggests that other AI providers struggle to engage younger demographics, as indicated by their lower adoption rates among 18- to 24-year-olds. Perplexity.ai, Midjourney, Anthropic, and Bard witnessed percentages of 22.7%, 22.3%, 25.3%, and 18.46% respectively within the same age group, in contrast to Character.ai’s 60% figure.
Globally, ChatGPT still maintains a significant lead over Character.ai in terms of mobile app usage. Android data shows ChatGPT with 22.5 million monthly active users, compared to Character.ai’s 5.27 million.
A Look at Website Traffic and Recent Trends
ChatGPT has experienced a decline in global website visits for three consecutive months. In August, it dipped by 3.2% to 1.43 billion, following drops of 10% each in the previous two months. Users also spent less time on ChatGPT’s website, with the average visit duration decreasing from 8.7 minutes in March to 7 minutes in August.
Similarweb suggests that Character.ai’s usage remained steady during the summer months due to its focus on providing entertainment rather than functioning solely as a homework helper or research assistant. Although Character.ai’s website traffic waned slightly, the adoption of its iOS and Android apps by mobile users compensated for this decline.
There is some positive news for ChatGPT as well. Following the resumption of the school year, traffic to the website in the United States increased by 0.4% in August. Additionally, unique visitors rose by 3% month-over-month in August in the US and 0.3% worldwide, reversing the declines observed in June and July.
Character.ai’s Promising Future
Character.ai possesses tremendous potential to further expand its user base, thanks to its substantial Series A funding of $150 million, announced earlier this year. This funding values the startup’s business at $1 billion. Despite the presence of several AI character generators on the market, investors were drawn to Character.ai due to the expertise of its founders, Noam Shazeer and Daniel De Freitas. Both founders are AI experts who previously led a team of researchers at Google in the development of LaMDA (Language Model for Dialogue Applications), a language model that powers conversational AI experiences.
According to GP Sarah Wang from a16z, the venture capital firm that invested in Character.ai, the founders have been “trailblazers in AI for nearly two decades.” Wang praised their creation of a powerful platform that combines models and applications, allowing Character.ai to continuously enhance and refine its product as more users create and engage with its characters.
While it remains to be seen if Character.ai will endure as a long-term trend among young people, Similarweb’s data clearly demonstrates its rise in popularity. Character.ai has yet to comment on Similarweb’s findings, but should they provide a response, we will update this article accordingly.
