• Proteams Information Tech

Consumer Spending on Apps Hits a Record $32bn; 40% Growth

A new report gives insights on the booming app market, expected to hit a new record in spending for 2021.

Last year the pandemic had a huge impact on online usage, as people quickly adopted online entertainment amid global coronavirus lockdowns. This trend was especially prevalent in apps, in the areas of work, school, shopping entertainment and fitness; where consumer spend rose 30% from 2019, up to a record $111 billion. App Annie also previously reported a record 218 billion in global downloads for the year 2020. This trend has not slowed down in 2021, in fact consumer spending in apps has broken a new record in the first quarter of this year. A new report from App Annie shows that consumers in the first quarter of 2021 spent $32 billion across Google Play and iOS platforms. This is a 40% year-over-year from the first quarter of 2020, the largest ever quarter on record, around $9bn more than in the previous quarter.

While the pandemic has had a terrible impact on many businesses worldwide, the technology industry has appeared to flourish, with hosts of innovative solutions to the pandemic and the lockdowns that followed. The app market is no exception, as people started downloading more apps on their devices as well as paying more for in-app purchases since the beginning of 2020.

iOS reportedly saw a larger consumer spend than Android in the quarter ($21bn and $11bn respectively), although the growth percentage was the same across both platforms (40%).

Image Credits: App Annie

The app categories that drove spending differed across platforms, Google Play saw the strongest quarter-over-quarter growth in terms of consumer spending from Games, Social and Entertainment apps, while Games, Photo & Video and Entertainment apps accounted for the strongest growth on iOS.

App Annie found that downloads on Google Play and the App Store combined rose by 10 percent to 31 billion in the first quarter. The driving categories for download growth also differed between iOS and Android; Games, Finance and Social Networking drove download growth for iOS, while on Google Play, Social, Tools and Finance saw the biggest download growth in Q1.

Other top categories across Google Play included Weather (40%) and Dating (35%), but iOS saw Health and Fitness app downloads grow by a notable 25% where the new stay-at-home lifestyle coincided with keep-fit New Years resolutions.

Image Credits: App Annie

Gaming also proved to be the most influential category across the board once again; gamers contributed around a billion title downloads every week in the quarter. Further, total consumer spending on gaming hit $22bn; iOS saw the biggest spending on games at $13 billion (up 30%), while Google Play saw a 35% increase on gaming spend to $9bn. Despite consumer spending reaching new highs, growth in downloads was less pronounced although still remained impressive; around a billion games every week were downloaded in the first 3 month of 2021, a 15% increase from 2020, and a further 35% growth on weekly average downloads from Q1 of 2019. the growth in mobile gaming alone outpaced overall app downloads by 2.5X.

The most downloaded game of this quarter was Supersonic Studio’s game Join Clash 3D, swapping places with Among Us!, now at number 2. The PUBG Mobile game was also among the top games in terms of downloads, consumer spend and monthly active users. App Annie further suggested that mobile gaming is set to reach $120 billion in consumer spend for 2021, which is 1.5X all other gaming formats combined. The games charts saw less change in consumer spend and monthly active users compared to other categories; Genshin Impact remained the second most successful title by consumer spend, after reaching top spot in the last quarter of 2020. Game publishers are increasingly prioritising mobile as part of their platform of choice to expand their user base, the continued success of the titles in the top spots shows how far mobile has gone to offer console-quality experiences; providing regular content updates have shown to bolster engagement and stickiness, small changes such as additional characters and quests are a key part of securing regular usage as well as incentivising in-app purchases.

Mobile gaming at record highs as we head into Q2 2021. The pandemic accelerated this growth with game downloads outpacing overall downloads by 2.5x in 2020. In 2021, mobile gaming is set to reach $120 billion in consumer spend, 1.5x all other gaming formats combined.” Donny Kristianto, Senior Market Insights Manager, App Annie

Image Credits: App Annie

The list of the world’s most popular non-gaming apps were not surprising; TikTok, YouTube and Facebook were the top apps by downloads, consumer spend and monthly active users. TikTok beat Facebook, in terms of downloads, and was followed by Instagram, Telegram, WhatsApp and Zoom. But TikTok only reached the second spot in the consumer spend category, with YouTube reaching number 1. Netflix has also dropped off of the consumer spend chart as it now directs new users to sign up directly through the site rather than through in-app purchases.

Image Credits: App Annie

The top breakout apps gave a bit more insight into global trends; we have been talking a lot about privacy and security as of late here on the Proteams Blog, and unsurprisingly the top breakout apps show that its not for no reason! Signal the Uber-private messaging app was the quarter’s fastest-growing app by downloads and monthly active users, Telegram (also a privacy focussed messaging app) also found itself among the top spots at 3rd place. This is likely to do with the announcement of WhatsApp's new privacy terms which caught headlines and cloud across social media and urged many users to switch their primary messaging platform.

At the top spot of the breakout list was MX Takatak; an app that is serving the growing demand in short user-generated video content (namely in India), as a part of the the current trend of rapid growth of home-grown publishers utilising social platforms like TikTok and Instagram. App Annie estimates show that it was the fastest growing app by downloads in Q1 of 2021.

Image Credits: App Annie

It is clear to see that the app market is getting bigger, growing at a faster rate than ever before - and it is unsurprising given the current global climate. The COVID-19 pandemic has meant that huge numbers of people are staying in, but it is expected that this trend will continue further after the pandemic, as apps are reaching new standards of usability.

In short, if you have been thinking about creating an app, or creating an app for your existing business, now is the time - this year is set to be the most lucrative in history for the app market. Get in touch today to get a free quote for your app.

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