TikTok has become the first non-gaming mobile application to surpass the milestone of $10 billion in consumer spending. As reported by app intelligence provider data.ai, places TikTok in an exclusive league alongside top-grossing gaming apps like Candy Crush Saga, Honor of Kings, Monster Strike, and Clash of Clans.
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According to data.ai‘s analysis, TikTok entered the year 2023 with $6.2 billion in consumer spending and has since added a $3.8 billion throughout the year, a 61% growth from the beginning of 2023. This figure also represents a 15% increase compared to the total consumer spending in 2022.
TikTok’s financial success is attributed to its in-app purchases of coins, a virtual currency enabling users to buy gifts for their favorite content creators.
The most popular in-app purchase is a bundle of 1,321 coins priced at $19.99, constituting a quarter of the app’s in-app revenue.
TikTok’s innovative monetization strategies in-app purchases, surrounding advertising and e-commerce, with the recent introduction of TikTok Shop.
Data.ai’s report reveals that the United States and iOS users in China have been the major contributors to TikTok’s consumer spending, accounting for approximately 30% each and forming a 60% chunk of the app’s total earnings.
Saudi Arabia emerges as a player in TikTok’s in-app purchases, outpacing countries like Germany, the United Kingdom, and Japan, contributing about 13% of the app’s in-app purchase revenue.
Lexi Sydow, Head of Insights at data.ai, predicts that TikTok is on track to become the highest-earning mobile app ever, approaching the $15 billion milestone in 2024.
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The report highlights that TikTokers are expected to spend a 40 hours per month in the app by the end of 2024, a 22% increase from 2023.
TikTok’s achievement is particularly as it surpasses the $10 billion consumer spending milestone, a previously reserved for gaming apps.
The only other apps to achieve this milestone are Candy Crush Saga, Honor of Kings, Monster Strike, and Clash of Clans. Candy Crush Saga currently holds the top spot with over $12 billion in lifetime user spending.
TikTok’s success, concerns about its connections to China have led governments worldwide to ban the app on official devices.
Additionally, the app has faced allegations of addicting teen users and causing mental health issues, claims that TikTok denies. However, the company has recently secured back-to-back court victories in the United States,
TikTok’s financial future appears brighter than ever, with a projected $15 billion in consumer spending expected in 2024.
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This forecast, coupled with TikTok’s diversified revenue streams, including in-app advertising and the introduction of TikTok Shop for e-commerce, TikTok’s position as a frontrunner in the race to become the world’s highest-earning mobile app.
While TikTok in its financial success, ByteDance, TikTok’s parent company, continues to experience robust revenue growth despite political headwinds.
The company, deemed the world’s most valuable private company, reported a 40% year-on-year revenue jump to $29 billion in the second quarter.
However, ByteDance’s valuation has seen a 10% decline from the previous year, reaching $268 billion, uncertainties surrounding its path to an anticipated initial public offering and increased regulatory.
The app has faced concerns about its connections to China, leading to government bans in various countries and accusations of addicting teen users and causing mental health concerns.
However, TikTok has also celebrated back-to-back court victories in the United States, providing some relief from regulatory pressures.
The app’s success is in its ability to transcend the gaming app category and emerge as a leader in consumer spending.
While other non-gaming apps like Tinder and YouTube are trailing TikTok in reaching the $10 billion milestone, the platform’s approach to user engagement and monetization positions it as a frontrunner in the race to become the world’s highest-earning mobile app.
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