TikTok’s upward trajectory is expected to continue in 2021, according to a new forecast from mobile data and analytics firm App Annie, which estimates the short-form video app will surpass the 1 billion monthly active user mark next year. The expanded forecast also looked into future trends around mobile ad spending and the growth in “at-home” activities fueled by mobile, like e-commerce and online meetings, for example.
TikTok’s growth numbers, however, were the standout estimate from the new report. The video app has grown in popularity, having nearly tripled in size since 2018, App Annie noted. And, as of the third quarter this year, TikTok became the No. 2 non-gaming app by consumer spending, due to its use of a combination of revenue streams, including advertising and sales of virtual gifts used for tipping streamers.
In 2021, App Annie expects TikTok to not only join the 1 billion monthly active user (MAU) club alongside Facebook, Instagram, Messenger, WhatsApp, YouTube and WeChat — it predicts TikTok will actually sail past the 1 billion MAU milestone to reach 1.2 billion average monthly active users.
This is remarkable growth, given that TikTok still remains banned in one of the world’s largest mobile markets, India.
And, of course, the fate of the social video app in the U.S. will have to do with how the incoming Biden administration handles the Trump TikTok ban. (And there are some signals his view doesn’t differ that much from Trump on this front.)
App Annie also predicted 2021 will see continued growth for “at-home” activities, fueled by mobile. Though there is promising news about a potential COVID vaccine, it’s not likely that everything will simply shift back to the way it was before the pandemic upon its release. The pandemic just accelerated trends that were already underway.
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The report estimates that time spent in key “at-home” categories — like remote business and education apps, e-commerce, mobile finance apps and at-home fitness apps — will top 1.3 trillion hours on Android phones in 2021, for example.
Specifically, remote business apps (e.g. Zoom) are expected to see a compound annual growth rate (CAGR) of 57% and remote learning apps will see 62% growth. Total time in mobile banking and finance apps will surpass 31 billion hours annually in 2021, representing a four-year CAGR of 35%. Fitness and e-commerce will grow as well, at +23% and +40%, respectively.
In addition, the firm predicts consumers will install up to 85% more video streaming apps in 2021 in the U.S., compared with pre-COVID levels.
And it expects mobile ad spend to reach $290 billion in 2021, in part thanks to strong mobile commerce growth and a further shift from offline advertising to digital.
“While the U.S. presidential election has helped fuel mobile ad spend in the latter part of 2020, App Annie expects ad dollars to continue to flow to smartphones in 2021,” the firm said. “Particularly given the consumer shift to mobile is not an isolated trend — COVID-19 catalysed the habits we were already forming,” the company added.
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