15+ Most Helpful App Revenue Statistics for Small Businesses in 2023

As a consultant who assists small businesses leverage technology, I‘ve seen firsthand the massive growth in smartphones and mobile apps transforming how companies operate and engage with customers. App adoption continues rising steeply year-over-year, and app monetization is following suit.

Let‘s explore the most recent app revenue statistics every entrepreneur should know as we enter 2023. I‘ll be sharing insider analysis and perspectives from my experience in this space as well.

Total Mobile App Market Size

The ubiquity of smartphones and mobile internet has fueled an absolutely staggering rise in the global app market. Consider that:

  • The mobile app economy will be valued at $407 billion in 2023, per recent projections. This includes revenue from paid downloads, subscriptions, in-app ads and commerce. [Source: Statista]
  • That represents explosive 110% growth from 2019 levels. Few industries are rising this rapidly.

What‘s driving such monumental growth? A few key factors:

  • More affordable Android devices and expanding mobile coverage in developing countries brings online over 100 million new smartphone users every year
  • Mobile gaming and streaming entertainment apps attract Gen Z/millennial users who are comfortable spending on subscriptions and in-app purchases
  • COVID-19 lockdowns accelerated adoption of shopping/food delivery and remote work apps

As you can see in the chart below, the global app market is expected to cross $1 trillion in value within the next 5 years:

Projected app revenue through 2027

With so many first-time smartphone owners coming online in emerging markets like India, I expect Asia-Pacific to contribute over 40% of new app users over the next decade.

Western entrepreneurs should absolutely pay attention to APAC app trends. Nimble startups could gain early traction serving massive overlooked app customer bases.

Top App Categories

Now let‘s examine which categories are winning the app race when it comes to user retention and revenue.

By Downloads:

  1. Games (11% market share)
  2. Business (9.1%)
  3. Education (8.6%)
  4. Tools (8.3%)

By Consumer Spend:

  1. Games (74% market share)
  2. Entertainment (7%)
  3. Photo & Video (5%)

Clearly gaming apps dominate monetization, while more utilitarian apps lead in cumulative downloads.

This corresponds with my small business clients‘ experience – games lent themselves better to addictive gameplay and in-app purchases. However, we‘ve also successfully charged subscription fees for premium education, health and productivity apps.

The key is precisely solving a major consumer pain point. Apps that form a daily habit or provide tremendous ongoing value can definitely justify paid fees.

Drilling down further:

Key App Monetization Models

There are a few predominant ways developers are generating billions in recurring app revenue:

  • In-app Purchases: Virtual goods, premium content, upgrades etc within free-to-use apps. Projected to reach $175 billion by 2023. [Source: Statista]
  • Subscriptions: For full-featured apps granting long-term access. Fastest growing revenue stream, hitting $29 billion in 2023. [Source: Statista]
  • Advertising: Ad revenue from free apps to reach $378 billion globally by 2023. [Source: Statista]

In-app purchases currently dominate, but I‘ve seen surging adoption of subscription models among the savvier small app publishers I consult. Netflix and Spotify demonstrated the value of affordable monthly access to robust, regularly updated mobile platforms.

Now even B2B service apps aimed at microbusinesses are launching wisely priced subscriptions for their target users.

Most Profitable Mobile App Categories

Let‘s explore the specific app genres making developers serious money in 2023:

1. Mobile Games

This category is so lucrative it deserves its own discussion. Consider:

  • Mobile gaming apps generate 75% higher revenue than other apps
  • Hypercasual games like Candy Crush are hot right now, optimized for short play sessions
  • Puzzle, arcade, battle royale and multiplayer titles also thrive
  • Top games easily clear $100 million in gross revenue

Monster hits like Roblox and PUBG Mobile incorporate social gameplay and in-app economies keeping users engaged for years.

2. On-Demand Service Apps

Uber defined how mobile apps could efficiently match consumer demand with available service providers. Regional on-demand platforms are still a gold mine:

  • Food & grocery delivery apps saw investments triple to $13 billion amidst the pandemic [Source: Pitchbook]
  • Uber for X niche delivery apps like goPuff raised $1.35 billion in 2021
  • Services like house cleaning, laundry, pet care, handyman jobs could be mobilized similarly

I‘ve guided local entrepreneurs build successful on-demand apps coordinating underutilized resources with customers craving convenience. With strong operational execution, the tech makes this a lucrative play.

3. Streaming & Entertainment

Mobile users spend nearly 70% of their digital media time on entertainment, making this a highly monetizable app niche through multiple models:

  • Netflix leads with over $7 billion in mobile revenue annually
  • Advertising-based streaming apps like YouTube, TikTok and television network apps are wildly popular
  • Niche sports apps offer playable game highlights and fan engagement features

I expect short-form vertical video apps like Snap and Instagram to further dominate youth attention spans with their sticky swipe interfaces and network effects.

4. Dating Apps

Another proven app niche still earlier in its maturity curve is online dating, with potential for meaningful monetization:

  • Post-pandemic, global dating app revenue could grow 25% per year, hitting $9.1 billion by 2027 [Source: Statista]
  • Tinder pioneered successful gamification and premium subscription packages
  • Niche demographic dating platforms continue gaining adoption

I‘ve seen niche dating apps gain decent early traction catering to specific communities and interests like farmers, single parents, fitness buffs etc. Definitely still growth runways here.

5. Fintech Apps

Apps supporting mobile banking, trading and crypto payments are another exploding niche I‘m advising financial entrepreneur clients on:

  • Global mobile banking users to reach 3.6 billion by 2025, up 15% [Source: Statista]
  • Payment apps like Venmo, CashApp, PayPal facilitating remote commerce
  • Strong potential for roboadvisors, microinvesting, digital currency apps

By bringing access to essential financial tools directly on smartphones, I foresee billionaire-making companies rising in this space soon.

Regional App Revenue Breakdown

It‘s also informative to examine geographic app revenue splits so you can identify high-potential markets:

By 2023 app revenue projections: [Source: Statista]

  • China: $110 billion
  • United States: $85 billion
  • Japan: $22 billion
  • South Korea $21 billion
  • Rest of World: $169 billion

China and the United States dwarf other regions for now given enormous addressable app audiences with relatively higher smartphone incomes to spend. However, India and South American countries are the world’s fastest growing app markets thanks largely to massive Gen Z populations.

I‘m advising clients to localize apps for languages and cultures across LATAM and Southeast Asia before bigger players dominate.

App Publisher Revenue Benchmarks

Finally, let‘s crunch some numbers around typical app sales and monetization metrics so you know rules of thumb to model your potential earnings.

App Publisher Revenue Metrics:

  • Average revenue per app download: $0.13
  • Average in-app purchase revenue per paying user: $76
  • Typical publisher cut for in-app purchases/subscriptions: 70%
  • Top 1% of publishers generate 95% of global app revenue

So while over 1 million apps now exist between iOS and Android, the app economy definitely has its superstar winners taking home the lion‘s share of profits.

For small app developers specifically, some good revenue benchmarks I reference:

  • Minimum viable product release: $15K MRR
  • Sustainable full-time business: $50K MRR
  • Highly successful indie app: $250K+ MRR

I hope this data equips you to make smarter app development and marketing decisions for your business. Let me know if you need any further advice!