TikTok Soaring Towards Unprecedented Success
Four other apps, aside from TikTok, reached the $10 billion milestone, according to app intelligence provider data.ai. These include popular games: Candy Crush from Activision Blizzard, Honor of Kings from Tencent, Monster Strike from Mixi, and Supercell's Clash of Clans.
Currently, Candy Crush holds the title for the highest revenue-generating game in history, with users spending over $12 billion in total. The figures are based on earnings from Google Play and Apple's iOS App Store. Despite this, TikTok seems set to surpass the gaming giant.
As per Mobile Gaming's Lexi Sydow, Head of Insights at data.ai, TikTok is poised to become the most profitable mobile app ever and is closing in on a $15 billion market by 2024. Users spend over $11 million daily on their favorite creators, making TikTok the most profitable app to date.
Sydow added that by the end of 2024, TikTok users will spend around 40 hours per week on the app, marking a 22% increase compared to 2023.
Users can gift creators on TikTok through in-app purchases of "coins," allowing purchases of gifts for influencers on the platform. These gifts reward creators for their content and are redeemable, with TikTok retaining 50% of payouts.
The most popular in-app purchase of 2023 is a $19.99 pack with 1,321 coins, accounting for roughly a quarter of TikTok's in-app revenue, according to data.ai. Besides in-app purchases, TikTok also generates income through advertising and eCommerce.
Tinder and YouTube rank second and third, respectively, in reaching the $10 billion milestone; however, they trail behind TikTok by about 2 to 3 billion USD by the end of 2023, as reported by the data provider.
Despite its financial success, TikTok faces concerns regarding links to China and potential adverse effects on young users. Various governments have banned the app on official devices. In the tech industry, TikTok's achievements are noteworthy, with the app projected to outshine popular games.
Insights: TikTok's growth is driven by its massive user base and effective advertising strategies. In 2021, TikTok generated $3.88 billion in advertising revenue, projected to triple to $9.89 billion in 2022. By 2024, it could reach $18.5 billion in global ad revenue.
TikTok's immense economic impact is also noteworthy, with a substantial contribution to small business owners' revenue and job creation. In the US, TikTok generated approximately $120 billion in 2023, indicating its rapid revenue growth and potential to surpass Meta in revenue.
Despite these successes, TikTok faces political challenges in the US, with a bill incentivizing a sale of the app to a non-Chinese company within six months. User safety concerns, primarily surrounding mental health and content moderation, continue to persist as well.
