Big Appetites, Smaller Wallets: Demand for Mobile Services Booms, While Consumer Spend Cools and Short-Form Video Paves the Way for Double-Digit Growth

data.ai releases its annual State of Mobile Report which sees consumers spending more than 5 hours per day on mobile

 data.ai (formerly App Annie), the leading mobile data analytics provider, reveals in its annual State of Mobile 2023 Report that demand for mobile apps accelerated last year while consumer spend shrank. Downloads grew to 255 billion (+11% YoY), and hours spent peaked at 4.1 trillion (+9% YoY). Meanwhile, consumer spending across all app stores, including third-party Android marketplaces in China, slipped by 2% YoY to $167 billion as economic headwinds impact discretionary spending.

“For the first time, macroeconomic factors are dampening growth in mobile spend,” says Theodore Krantz, Chief Executive Officer of data.ai. “Consumer spend is tightening while demand for mobile is the gold standard. In 2023, mobile will be the primary battleground for unprecedented consumer touch, engagement and loyalty.”

Short-Form Video apps, led by TikTok, dominated consumer attention in 2022. Users of these apps streamed a whopping 3.1 billion hours of user-generated content daily, up 22% YoY, and spent $5.6 billion, up 55% YoY, fueling the creator economy.

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More key findings include:

• Time spent on mobile increased to 5 hours per day, up 3% YoY in the top 10 markets.
• OTT (Over-The-Top) apps such as Netflix and Disney+ grew 12% YoY to $7.2 billion.
• Mobile ad spend is set to hit $362 billion in 2023, driven by growth in short-form video and video-sharing apps like TikTok and YouTube.
• Spending on gaming apps dropped by 5% YoY to $110 billion, yet downloads reached new records at 90 billion, up 8% YoY.
• Spending on other apps (non-gaming) increased by 6% YoY to $58 billion, largely driven by subscriptions and purchases in OTT, d*****, and short videos. Downloads increased 13% YoY to 165 billion.
• Simulation game genres, including Simulation Driving, Hypercasual Simulation, and Simulation Sports, drove growth YoY for downloads, while Action MOBA and Roguelike ARPG games bucked the spending downturn.
• Financial volatility reshaped consumer appetite for risk: in the US, crypto trading and investing app downloads dropped 55% YoY, while personal loan app downloads surged 81%.
• Price-sensitivity reshaped consumer retail spending priorities: BNPL (Buy Now, Pay Later) app downloads grew +47% YoY, Coupons & Rewards +27%, and Budget & Expense Tracker +19%.
• Rebounds in travel and interest in language learning command share of wallet despite tightening purse strings. Apps such as Booking.com, Airbnb, and Duolingo saw growth.

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This year’s State of Mobile report identifies and discusses macro-trends for leading brands and publishers and what success looks like for mature apps across gaming, fintech, retail, social, video streaming, and more. The report delves deep into demographics and app, and game categories made possible by the more than 250,000 apps categorized under data.ai’s industry-first Game and App IQ taxonomy.

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