The app ecosystem experienced major shifts in 2021, including Apple’s app-privacy crackdown, an antitrust clash over developer fees, and Google’s allowing betting apps in the Play Store.
A record $133 billion was spent on apps last year, up 20% from 2020, the mobile-app data firm Sensor Tower estimates. Streaming services had another successful year, and mobile shopping grew as the pandemic persisted.
The mobile insights strategist Stephanie Chan of Sensor Tower and other analysts from Apptopia and App Annie spoke with Insider about the biggest trends they see for the industry in 2022.
Apple’s App Store regulatory cloud
Apple has been under scrutiny for policies that force mobile developers to use its system for in-app payments, giving the iPhone maker a cut of whatever a user spends. The Fortnite maker Epic sued Apple over the issue.
Although the federal lawsuit is ongoing and was recently reversed by an appellate court, Sensor Tower’s Chan said that legal decision and others could affect how the mobile market plays out in 2022.
“There’s a lot of debate around whether or not Apple’s policies are good for developers or bad,” Chan said. “We’re just going to have to wait and see how the developers react to this and also see how Apple chooses to shift their policies.”
A Dutch regulator in December ordered Apple to change its payment practices due to violations of competition laws, and the European Commission opened an investigation into the payment structure earlier in 2021.
Crypto and finance apps
Lexi Sydow, head of market insights for App Annie, said many of last year’s breakout apps were crypto-related. This is part of a broader embrace of finance apps, which have struggled in the past to catch the attention of consumers, she noted.
Crypto.com, Binance, and Coinbase were the most-downloaded crypto apps in 2021. Together, they were downloaded 145 million times, up from 18 million in 2020, Apptopia data shows. Some originally local crypto apps also reached a global scale in 2021, such as the Israel-based eToro and the Turkish exchange BtcTurk.
“We’re seeing acceleration happen now, especially in fintech, and crypto is a huge part of that,” Sydow said.
Mobile-first Gen Z users are engaging more with finance apps, and the behavior of this demographic group will likely have a major effect in the finance industry, Sydow said.
“There’s a really unique opportunity for a mobile-first generation to basically form new habits that probably buck trends that have been seen for many generations,” Sydow said.
“In the US, for instance, we’ve reached a point where on average, in some of the top banking apps, users open the app at least once a day, and basically you would never have walked into a bank once a day on average,” she added.
Rather than using a traditional banking app, like Bank of America, JPMorgan Chase, or Wells Fargo, Venmo could be some people’s only experience with a financial app, Sydow said.
Travel and transportation
After getting hammered in 2020, travel-related apps bounced back in 2021, and analysts are watching to see how they perform in 2022.
Adam Blacker of Apptopia said car travel boomed throughout 2021 with rental-car app usage at record levels and rapid adoption of new parking apps. That points to greater interest in traveling solo and more integration of mobile apps in vehicles.
Car marketplaces such as Carvana and Autotrader also experienced an uptick in usage as demand soared and supply waned, sending vehicle prices surging.
Travel-related companies had to adjust to the pandemic, and Blacker said he looks forward to seeing how the industry will fare as opinions on COVID-19, vaccinations, and travel evolve.
“Whether it be airlines, travel agencies, hotels, cruise-ship apps — everything has an app, so it’s interesting — you can kind of track consumer feelings and trends through those things,” Blacker said, adding that he is particularly interested in observing new installs of cruise-ship apps.
Wellness apps and subscriptions
Wellness apps like Planet Fitness and Flo also experienced a successful year, and Sydow said health and fitness apps were especially successful at monetizing through subscriptions — a trend that started in 2020 but grew in 2021.
“People are treating their phones as sort of this central subscription management in a lot of ways,” Sydow said, pointing to streaming services and other phone-based subscriptions.
While games still lead for in-app purchases, she noted that subscription spending is growing faster and said she thinks this will expand across other industries in 2022.
Metaverse and games that blur the line of social media
Facebook announced in October that it was rebranding to Meta to mark its new focus on the metaverse, a digital social platform where people interact using virtual- and augmented-reality technology.
Sydow pointed to the popular games Among Us and Pokémon Unite as examples of social games but highlighted how the 2021 breakout app Roblox — a gaming and game-developing platform — is now the closest to a true metaverse.
“You’ve got user-generated content, socialization, world-building capabilities, avatars — that kind of encompasses that metaverse genre,” Sydow said. “It’s designed to be a very immersive experience, but you don’t need any additional hardware.”
This trend emerged before COVID-19, but the pandemic catalyzed the socialization of games and introduced nongamers to games on their phones, such as Sudoku or Scrabble Go.
Sydow added that due to metaverse growth, consumers will likely spend more on micropurchases such as skins for avatars, stickers, or add-ons for projects within games.
More centralized apps, like those in Asia
Chan said apps in the US are becoming more like the “one-stop-shop” apps in Asia such as WeChat and Line, which offer shopping, payments, phone calls, texts, social media, news, and more.
She highlighted how livestream shopping has accelerated in the past year and pointed to a recent Twitter and Walmart partnership that lets users buy products featured in Walmart’s livestream broadcasts on Twitter.
“It is cool to see that all these different platforms are sort of competing with one another with sort of similar feature sets and seeing if they can differentiate themselves,” Chan said.
She also noted how Amazon acquired exclusive rights to the TikTok app on televisions, which allows people to stream videos on their Amazon Fire televisions.
TikTok in July became the first nongaming app not owned by Facebook to reach 3 billion installs, and tools to help creators on the platform also thrived.
An Apptopia report showed that video-editing app CapCut, also owned by the TikTok parent ByteDance, was one of the 10 most-downloaded apps in the US last year.
“It’s all about how do we get these creators tools? How do we help them monetize? How do we help them grow their fan bases and stay on our platform and keep the money coming in for us?” Blacker of Apptopia said.
Sydow of App Annie added that TikTok had a breakout year in terms of consumer spending, demonstrating the creator economy in action, with people spending money on in-app purchases and subscriptions.