People are spending more money than ever on the App Store, and it is only expected to increase. According to new data from Sensor Tower, U.S. iPhone users spent an average of $138 on apps in 2020, an increase of 38% year-over-year, and that figure is only expected to increase in 2021.
The surge in online spending in 2020 can be attributed to people having to stay at home during the ongoing coronavirus pandemic, which drove remote work and education. Sensor Tower estimates that that consumer app spending will hit an average of $180 in 2021.
U.S. iPhone users spent an average of $138 on the App Store in 2020
As per new data shared by Sensor Tower, the average amount of money spent on apps for United States iPhone users was $138 in 2020, a massive 38% increase when compared to the year before. The report attributes the increased spending to premium apps and in-app purchase:
“Average in-app spending per U.S. iPhone reached a new record in 2020 and saw the greatest annual growth since 2016 when it grew 42 percent Y/Y. At the same time, this growth significantly exceeded the 27 percent Y/Y increase seen between 2018 and 2019 when it rose from $79 to $100.
2020 year-over-year growth in the average annual in-app spending per active U.S. iPhone exceeded growth seen in 2019.”
The trend is not just restricted to the United States. With the coronavirus pandemic forcing the global population to stay at home and the closure of cafes, bars, and malls, many people turned to their smartphones as a source of entertainment. As far as the breakdown of categories which saw the highest spending, gaming took the top spot with a growth of 43% in 2020 compared to 2019. Users spent an average of $76.80, up from $53.80.
“Per-device spending in mobile games saw explosive growth in 2020, leaping from $53.80 in 2019 to $76.80. This represents Y/Y growth of 43 percent, more than 20 points higher than the 22 percent Y/Y growth seen in 2019 when in-game spending climbed from $44.
An analysis of Sensor Tower Game Intelligence data reveals U.S. iPhone users spent the most in Puzzle games per device, averaging $15.50 on the category, which includes titles such as Candy Crush Saga and Gardenscapes. The Casino category saw the next highest user spending, averaging $13.10, followed by Strategy, which saw a surge in revenue last year and saw an average of $12.30 per iPhone in user spending.”
Other categories that saw massive growth during 2020 included entertainment, photo & video, social networking, and lifestyle. Apps like Disney+, TikTok, Twitch were important catalysts in App Store spending. In 2020, Twitch saw 680% year-over-year revenue in the United States. TikTok also saw exponential growth of 140%.
Sensor Tower’s projection of consumers spending more in 2021 can be corroborated by recent App Annie data. According to the data, users spent $32 billion on in-app purchases across iOS and Google Play globally in Q1 2021. The figure is 40% up on the same quarter for 2020. Note that the report includes data from some third-party Android app stores in China.
“The numbers illustrate the remarkable impact that the pandemic has had on the app market. Q1 2020 was the first period of global lockdowns. Stay at home orders forced consumers to seek out indoor stimulation, and they found it on their smartphones, through games and other highly engaging apps such as video streaming and social sharing platforms.
As a result, the market grew at unprecedented speed. Smartphone users spent around $9 billion more on apps and games in Q1 2021 than they did in Q1 2020.”
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