Video streaming, gaming, and payment apps see strong growth

February 11, 2022

Different mixed-races people with masks on faces at bus stop or train station with suitcases keeping social distance.
Jonathan Bennett, Chief Commercial Officer

Jonathan Bennett

Chief Commercial Officer

The coronavirus pandemic compelled many people to change their behavior in 2020, not least when it came to the mobile apps they download. Long periods of lockdown prompted consumers worldwide to reach for their smartphones to help them work, study and entertainment themselves and undertake essential everyday functions like shopping and banking.

Sensor Tower’s Mobile App Industry Trends 2021 report provides a detailed analysis of those trends. The company has tracked App Store and Google Play downloads (one per user) from January 2018 to December 2020. Its findings add further confirmation that social and economic restrictions introduced to combat the spread of coronavirus at the beginning of 2020 spurred a lasting lift in spending on mobile apps over the rest of the year. The 2020 holiday season drove mobile spending to a new record of US$10bn in December, for example, while monthly downloads exceeded 12bn for six months of the year. While Sensor Tower concedes that the pandemic’s impact on downloads may prove to have been short-lived, spending patterns suggest that apps began to see the benefits of adding so many new users in such a short space of time very quickly.

Essential apps like business, health and fitness, and education saw the most significant spike in demand immediately after the coronavirus outbreak as hundreds of millions of people were restricted to working and studying from home for the first time. Developers were quick to respond, with 136k new education apps accounting for 8% of all apps launched for the first time during 2020 on Google Play, second only to games (225k). Utility (49k) and business app launches (47k) also featured conspicuously on the Apple Store, again trailing only games (65k) in volume.

Mobile apps provide a much-needed source of entertainment

It was hyper-casual, instantly playable mobile games with short sessions that dominated downloads in 2020, as people with little or no previous gaming experience installed titles that were easy to play. Adoption rates for the top 1,000 hyper casual game genres grew 45% year on year in 2020 to exceed ten billion installs.

These games have large fan bases and provide in-app subscription models which allow players to purchase in-game items and currency. Popular examples included Brain Out, Wordturning, Save the Girl, and Join Clash 3D, for example, as well as persistent favorites, Garena Free Fire, Subway Surfers, and Among Us. However, other titles generated more gross revenue, particularly those like PUBG Mobile, Honor of Kings, Roblox, Coin Master, and Candy Crush Saga.

Sensor Tower’s report also highlights the increasingly fierce competition for subscribers and revenue amongst over-the-top (OTT) video streaming platforms during the year – with the dominance of Netflix coming under pressure for the first time after the debut of Disney+ in November 2019. While Netflix was the fourth-ranked app worldwide by gross revenue in the first quarter of 2020, it had slid down to seventh in the second quarter behind Disney+ in fifth place. Netflix dropped further to 8th in Q3 and 10th in Q4, while Disney+ had risen into fourth place. The top three spots were occupied by TikTok, YouTube, and dating app Tinder throughout the year, though not always in that order.

Growing demand for fintech apps

Sensor Tower also noted a more significant demand for Fintech apps in 2020, led by mobile payment, stock trading, and cryptocurrency platforms. It calculated that finance apps accumulated nearly five bn downloads between them in 2020, up 25% from the previous year. By the end of the three months ending December 2020, that figure had jumped to 1.3bn. The company had recorded a consistent compound annual growth rate (CAGR) of 22% in this category going back to Q218 when they generated 747m downloads.

Although success came from different approaches, payment apps dominated Sensor Tower’s 2020 Fintech charts, led by Google Pay, PayPal, and PhonePe. New Google Pay downloads increased 11% yearly from 134m in 2019 to 149m in 2020. A business-to-business (B2B) version – Google Pay for Business enables merchants to embed support for faster Unified Payments Interface (UPI) transactions within their websites, applications, or platforms registered 20m new downloads in 2020, up 162% from just 8m in 2019.

PayPal enjoyed much faster growth rates from a smaller base – new downloads increased 78% year on year to reach 91m in 2020. But whereas Google Pay and PayPal are global brands that signed up new customers in multiple regions and territories of the world, 99% of PhonePe’s installs come from one country – India – making its 38% year on year growth (84m new downloads in 2020) all the more impressive.

Besides Google Pay for Business, many other payment apps saw impressive double-digit download growth from a much smaller base. Two of these hailed from Brazil after the country’s government introduced an Open Banking initiative in August 2019 – digital wallet PicPay, which saw new installs leap 188% year on year to 28m, and digital bank PagBank (up 137% to 18m). New downloads for Cash App, the mobile payment transfer service developed by Block for consumers in the US and the UK, grew 45% year on year to reach 39m in 2020 according to Sensor Tower, while another Latin American digital wallet grew 83% to 36m.

It seems unlikely that the growth rates for mobile app downloads and associated revenues witnessed in 2020 will be seen again. But established habits are hard to kick. We are likely to see some of these trends continue. There is no doubt that consumers who have gotten used to spending more time using smartphones over the last couple of years will continue to engage more proactively with the mobile app ecosystem long after the pandemic subsides as it has begun to.

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