Is 2023 the year of opportunity for subscription apps? Podcast with data.ai’s Lexi Sydow

Why localization might be key to unlocking new subscription app growth.

Is 2023 the year of opportunity for subscription apps? Podcast with data.ai's Lexi Sydow
David Barnard

David Barnard

PublishedLast updated

When it comes to mobile, data.ai’s State of Mobile 2023 report offers the go-to insights you need to grow and thrive.

In this episode of the Sub Club podcast, Lexi Sydow, Head of Insights at data.ai, dives deep into the data to reveal what’s in store for subscription app developers in 2023. We sit down with Lexi to look at the countries that subscription apps should focus on for growth outside the U.S. We also explore why — despite a decline in overall app spend — there’s more than a silver lining for subscription app growth.

Lexi and the data.ai team have more than 12 years of experience analyzing complex data and delivering action-oriented insights across the private and public sectors. That experience perfectly positions them to pinpoint what you need to do to leverage the gains subscription apps are seeing right now.

“Our team of analysts are following the industry every day… There’s a maturation of the industry, and we’ve also matured our analysis and understanding throughout the years to follow more of that deep dive [into the data].”

Lexi Sydow

Key insights include mainstays like gaming and social media, but the 2023 report features new areas of focus as well. “We want to make sure we talk to video streaming,” Lexi explains. “We’ve heard for a few years that streaming wars are heating up. It’s still true: That space is still really dynamic and highly competitive in the U.S. specifically.”

Another focal topic absent from previous years is sports. Between the World Cup, Beijing Olympics, and pent-up post-COVID demand, the sports world is making a definite impact this year. “It’s one of those things where we evolved based on consumer behavior,” Lexi highlights. They also included sports data based on questions that came out of webinars.

Overall app spend may be down, but subscription apps remain resilient

Despite the doom-and-gloom statistic that mobile app spend was down by 2% for the first time ever, a drop in gaming app spend largely fuelled this decrease. This category boasts 66% of all app store spend, so it stands to reason that it would be the main contributor to the decrease. Discretionary purchases — like new pieces of clothing for in-game avatars — are where people are spending less. In fact, app downloads are up — by 11%.

On the flip side, non-gaming app spend grew year-over-year by a modest 6%. Why? It’s all thanks to the subscription model. But for more impressive growth, look away from the U.S. market: Mexico, for example, saw a 26% growth in non-gaming app spend. A lot is happening in pockets outside of the big three: China, the U.S., and Japan. Subscription app developers would be wise to note these trends so they can explore opportunities in these higher-growth markets.

The mobile ecosystem hasn’t yet reached its full potential. Apps that win out in the long run in terms of paying subscribers will be those that offer frictionless, personalized experiences. Tapping into — and even shaping — native behavior is key.

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