TikTok Crosses $10 Billion in in-app Transactions

According to data.ai's latest annual report, ByteDance Ltd.'s TikTok became the first app to surpass $10 billion in cumulative consumer spending, propelling mobile app sales to a new high in a year when revenue from games was down. TikTok and Disney+ video-streaming platforms drove an 11% increase in consumer app sales in 2023, demonstrating resilient demand, while the games industry faced a double-digit sales decline in China, dragging global sales down 2%.

TikTok’s in-app purchases of credit that can be used to tip favored creators and live streamers accounted for the bulk of its income, and “unlocked the secret to monetization on mobile,” according to the market researchers, whose services are used by many of the world’s biggest brands to track the performance of their mobile apps and ads.

"Social apps and the creator economy pioneered new pathways to monetization beyond advertising," said Lexi Sydow, data.ai's director of corporate marketing and insights. "TikTok paved the way with its content creator tipping mechanism. As competition heats up, direct consumer monetization in social apps via in-app purchases is expected to increase 150% to $1.3 billion by 2024."

Spending on apps, rather than games, increased as consumers increased their spending on streaming, user-generated content, and dating apps. Still, advertising was the bigger revenue driver in 2023, rising 8% to $362 billion and accounting for two-thirds of mobile sales. As a result, the battle to attract and retain user attention is critical, with data.ai estimating that global mobile ad spending will reach $402 billion by 2024.