As the first non-gaming app to do so, TikTok has crossed the $10 billion consumer expenditure milestone.
The social media and short-form video app TikTok is having a record-breaking year. In Q12023, it became the first mobile app to generate over $10 billion in global consumer expenditure in a single quarter.
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With over $6.2 billion in customer spending at the beginning of the year, the platform has seen an additional $3.8 billion in expenditure during the course of the year. That is a 15% increase over the total amount for 2022 and a 61% decrease from where it was at the start of 2023.
TikTok is now one of just five smartphone apps—and the only one that isn’t a game—to reach this milestone. It is privileged to be seated among the greatest mobile games ever, like Monster Strike (XFLAG/Mixi), Candy Crush Saga (King/Activision Blizzard), Clash of Clans (Supercell), and Honor of Kings (Tencent). Tinder and YouTube are the non-gaming apps that are closest to overtaking TikTok at the $1 billion milestone, but they still lag behind by about $2–3 billion.
The money spent on influencer gifts on TikTok is derived from in-app purchases of “coins” on the platform. Gifts are redeemable, and TikTok retains 50% of the proceeds as compensation for the content creators.
“TikTok is on track to surpass all previous mobile app earnings records when it reaches the $15 billion mark in 2024. TikTok has surpassed the most lucrative mobile games in the world thanks to users tipping over $11 million per day for their favorite content creators. Lexi Sydow, Head of Insights at Data.AI, made this announcement regarding TikTok’s report, noting that users are expected to work a 40-hour work week on the app by the end of 2024, up 23% from 2023.
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This year, the most popular in-app purchase on TikTok has allegedly been its bundle of 1,321 coins for $19.99, which accounts for about 25% of the platform’s in-app earnings. The short-form video app makes money from e-commerce and advertising as well.
Because of worries about TikTok’s ties to China through its parent firm ByteDance, governments everywhere have banned the app in one way or another. Earlier this month, TikTok won two straight court cases in the United States, which will probably make it more difficult for the company’s detractors to implement significant reform.
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