Consumer Spending on Mobile Apps Hits $171 Billion in 2023
Consumer spending on mobile apps reached a new record of $171 billion in 2023, showing a three percent increase compared to the previous year. This growth came after a two percent decline in 2022. The mobile app economy has now become a half-a-trillion-dollar market, with approximately $1.5 billion being spent every day in 2023 on app store purchases and mobile advertising, reports Reuters.
According to data from data.ai’s ‘State of Mobile 2024’ report, mobile ad spending alone accounted for $362 billion, showing an eight percent year-on-year increase.
Mobile App Economy Surpasses Half-Trillion Dollars
In addition to revenue, other metrics like downloads and time spent on mobile apps also reached all-time highs in 2023. The number of hours spent on mobile apps peaked at 5.1 trillion, representing over six percent growth. However, downloads remained relatively stable at 257 billion, with only around one percent growth.
The report highlighted the significant increase in app store spending, particularly noteworthy considering the significant decline experienced in 2022, primarily driven by the mobile gaming sector.
Mobile Ad Spending Soars to $362 Billion in 2023
Mobile ad spending saw a remarkable increase in 2023, surpassing the $300 billion mark. Data from the ‘State of Mobile 2024’ report revealed that mobile ad spending alone reached $362 billion, showing an eight percent year-on-year increase. This growth can be attributed to the rising popularity of short-form video and video-sharing apps.
Apps Overtake Games as Top Revenue Generator
Apps have surpassed games as the main driver of consumer spending in the mobile app economy. In 2023, consumer spending on apps experienced an 11 percent year-on-year increase, amounting to $64 billion. This figure is more than six times the total spending in 2016. The rise of social media platforms like TikTok played a crucial role in this growth. TikTok’s unique content creator “tipping” mechanism helped the platform surpass $10 billion in lifetime spending.
Generative AI Apps Experience Remarkable Growth in 2023
Generative Artificial Intelligence (AI) apps witnessed a significant growth in 2023, expanding by seven times. This growth led to the emergence of new sectors like AI Chatbots and Art Generators. The influence of generative AI extended to various mobile sectors, driving a new wave of digital innovation. Notable generative AI apps mentioned in the report include ChatGPT, Ask AI, and Character AI.
By late 2023, generative AI apps had achieved monthly consumer spend exceeding $10 million.
In conclusion, consumer spending on mobile apps in 2023 reached new heights, driven by various factors such as the rebound in app store spending, the rise of generative AI, and the popularity of social and entertainment apps. The mobile app economy has become a half-a-trillion-dollar market and continues to show growth potential in the coming years.
Analyst comment
Positive news. The market for mobile apps is expected to continue growing in the coming years with increased consumer spending, especially in the areas of app store purchases, mobile advertising, and generative AI apps. The rise of social and entertainment apps, as well as the popularity of short-form video and video-sharing apps, are driving this growth. The market has surpassed the half-trillion-dollar mark and shows potential for further expansion.
