After a slowdown in 2022, the app economy has regained momentum, as revealed in data.ai’s annual “State of Mobile” report. The report highlights a 3% increase in consumer spending, reaching $171 billion across the App Store, Google Play, and third-party Android app stores in China. This growth is attributed to a surge in non-game app spending, driven by the success of apps like TikTok. However, app downloads remained stagnant at 257 billion, marking only a 1% increase from the previous year.
Key Takeaway
The app economy rebounded in 2023, witnessing a
71 billion consumer spending surge, driven by non-game apps and AI advancements. While app downloads remained flat, the report indicates a positive trajectory for the app market, with social apps and AI features playing a pivotal role in shaping consumer behavior.
Consumer Spending on Non-Game Apps
The report indicates an 11% year-over-year growth in consumer spending on non-game apps, totaling $64 billion in 2023. This growth was primarily fueled by social apps and the creator economy, with TikTok leading the way by surpassing $10 billion in lifetime spending, making it the first non-game app to achieve this milestone. The report also predicts a 150% increase in consumer monetization for social apps, reaching $1.3 billion.
App Revenue Milestones and AI Advancements
More than 1,500 apps and games generated over $10 million annually, with four new apps reaching $1 billion in revenue. The report also highlighted the significant role of generative AI advances in driving consumer spending, leading to the expansion of the genAI app market and the emergence of new consumer experiences such as AI chatbots and AI art generators.
Adoption of AI Features and Market Insights
Over 4,000 apps added “chatbot” to their descriptions, while more than 3,500 incorporated “gpt,” reflecting the growing adoption of AI features. Additionally, the report revealed a 11% year-over-year growth in downloads for apps with AI features, with 65% of these apps experiencing positive growth. The comprehensive report also provided insights into app ecosystem health, including app installs, time spent, ad spend, and gaming-specific details.
Mobile Ad Spending and Gaming Trends
The report projected a significant increase in mobile ad spending, reaching $362 billion in 2023 and estimated to grow to $402 billion in 2024. Despite this growth, mobile gaming experienced a 2% decline in spending, amounting to $107 billion. However, certain game genres and titles, such as Hypercasual, Simulation, and Genshin Impact, achieved notable milestones and performance.
Emerging Trends and Market Insights
Several emerging trends were identified, including the growth of Chinese shopping apps in Western markets, increased time spent on social and entertainment apps, and a surge in travel app downloads. The report also highlighted the performance of top apps and games by country, providing a comprehensive overview of the global app landscape.
Conclusion
The “State of Mobile” report by data.ai paints a positive picture of the app economy’s resurgence in 2023, with a focus on consumer spending, app revenue milestones, AI advancements, and emerging market trends. As the app market continues to evolve, it is evident that non-game apps, AI features, and shifting consumer behaviors are shaping the future of mobile experiences.
