• by Colin Kirkland , January 11, 2024

While some specific mobile app genres had better results than others, mobile made an overall comeback in 2023 after a one-year market slowdown.

According to a new report by mobile analytics company data.ai, consumer spending grew 3% year-over-year on average thai year, while the influence of AI flourished, the amount of time spent on mobile apps increased by 6% compared to 2022, and ad spend is set to climb due to the popularity of video-sharing apps.

Data.ai’s findings show social apps and the creator economy carving new avenues for monetization beyond advertising, with TikTok becoming the first non-gaming app to hit $10 billion in consumer spending due to its coins tipping feature.

In the U.S. TikTok now earns more than $1 per user, up from 67 cents per user in 2022. Discord came in second at 17 cents per user.

In 2024, data.ai predicts that direct consumer monetization in social apps is set to grow 150% to $1.3 billion as platforms start to prioritize in-app-purchases rather than subscription services. However, Snapchat increased its consumer spend 5x because of Snapchat+ subscribers.>

Engagement was more mixed across social media apps, but it did increase on Android phones, climbing 9% in 2023 to over 2.3 trillion hours.

For mobile gaming apps, downloads remained consistent, but in-game spending decreased to $107 billion, down 2% year-over-year.

Casino games proved to be the leading genre in the U.S., with strategy and multiplayer RPG games like Battle Royale and MMORPG now taking more of the market share, indicating a desire for connection and social experiences in the mobile gaming world.

Artificial intelligence was also a star of 2023, serving as the foundation for all mobile apps, “permeating every sector and paving the way for a fresh wave of digital innovation,” says data.ai CEO Theodore Krantz.

Generative AI expanded by 7x in 2023, leading to the emergence of new sectors like AI chatbots and art generators, while also fueling embedded features across all mobile sectors. Notable apps that pioneered advances in AI include ChatGPT, Ask AI, and Open Chat.

Krantz believes TikTok’s use of AI will secure the China-owned app a spot as “the highest-grossing app in history.”

With consumers spending more time than they ever have on mobile apps, data.ai predicts mobile will continue to take a larger share of marketer’s ad spend, reaching $362 billion –– an 8% increase –– in 2024.

With 5.1 trillion hours spent on Android phones in 2022 and video-centric apps like YouTube and TikTok continuing to gain more consumer attention by average time spent per user than other social networks, data.ai says that “ad spend growth will bounce back a bit from the slower growth in 2023.”