The State of Apps with Olivia Moore | Summary and Q&A

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February 9, 2023
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The a16z Podcast
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The State of Apps with Olivia Moore

TL;DR

The App Store is experiencing a shift with new social apps, vertical social networks, and AI-powered products gaining traction. TikTok continues to drive viral sensations, while the rise of invisible AI and the interplay between digital and physical experiences are shaping app trends.

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Questions & Answers

Q: How did Olivia Moore compile the data on the top apps of 2022?

Olivia used an app data source called AppFollow.io, which publishes a daily ranking chart of the top iOS apps based on the Apple App Store ranks. She recorded the top apps for each day of 2022 and analyzed the data for insights.

Q: What were the top three apps of 2022?

The top three apps of 2022 were BeReal, TikTok, and Gas App. BeReal, a new social media app, emerged as the number one app with its live, limited-time camera feature. TikTok, a short-form video platform, remained popular, while Gas App gained traction with its anonymous compliment-sharing feature.

Q: Are we witnessing a new age of social media apps?

Yes, the top apps of 2022 were dominated by social media platforms, but they differed from the previous generation of social apps. These new apps focused on authenticity, interactive experiences, and smaller, close-knit communities. Traditional feed-based social media platforms, like Instagram and Snapchat, did not make it to the top.

Q: How difficult is it to stay on top once an app reaches number one?

The data suggests that it is challenging to maintain the top spot. Many apps that reached number one were only there for a day or a few days, highlighting the need for a strong and retentive product. Going viral is easier now, but staying at the top requires consistent engagement and value delivery to retain users.

Q: How are apps effectively monetizing in the current App Store landscape?

Apps are adopting various monetization strategies, including in-app purchases, subscriptions, and partnerships with insurers or B2B companies. The success of monetization depends on providing value to users, aligning pricing with consumer willingness to pay, and adapting to changing user behaviors and preferences.

Summary

In this episode of the a16z podcast, Olivia Moore, a partner at a16z Consumer, discusses the state of the App Store and shares insights into the top apps of 2022. She compiled data on the daily rankings of iOS apps throughout the year and analyzed the apps that achieved the number one spot. The top three apps of 2022 were Be Real, TikTok, and Gas App, all of which are social media apps. However, Olivia notes that the absence of popular social media platforms like Instagram and Snapchat from the top three suggests a shift towards more authentic and interactive social experiences. She also identifies other trends in the App Store, such as the rise of widgets, AI-powered apps, and anonymous social apps. Olivia explores various monetization strategies, highlighting the success of in-app purchases and subscriptions, and discusses the challenges of staying at the top of the charts in a rapidly changing landscape.

Questions & Answers

Q: How did Olivia compile the data on the top iOS apps of 2022?

Olivia used an app data source called app follow.io, which publishes a daily ranking chart of the top iOS apps based on the Apple App Store ranks. She recorded the top app for each day of 2022 and analyzed the data to identify trends and insights.

Q: What were the top three apps of 2022?

The top three apps of 2022 were Be Real, TikTok, and Gas App. Be Real is a new social media app that gained popularity for its live camera feature, TikTok maintained its position as a leading social media platform, and Gas App allowed users to send anonymous compliments to friends.

Q: Are we entering a new era of social media with these top apps?

The dominance of social media apps in the top charts suggests a shift towards a new age of social. Unlike traditional social media platforms like Instagram and Snapchat, the top apps of 2022 focused on authenticity and interaction, providing users with more delightful and consistent ways to engage with close friends.

Q: Is it difficult for apps to stay at the top of the charts?

Yes, it is challenging for apps to maintain their position at the top. The pace of new apps reaching number one is increasing, and many apps only spend a day or less at the top. Winning the number one spot requires a significant number of daily downloads, often exceeding 100,000, and competition from established companies with large marketing resources adds to the difficulty.

Q: How do apps build retention and create a lasting product?

Building a product that delivers value day after day and has network effects is crucial for retention. Products that improve with more users, creating a better experience, and those that encourage sharing and word of mouth have a higher chance of building a strong user base. Apps like Be Real, which has a limited live camera feature, and Gas App, which allows anonymous compliments, create moments and hooks that make users want to continue using the app.

Q: Can apps achieve success by mimicking successful past apps?

While mimicking successful past apps can bring initial success, it is not a guarantee for long-term success. The landscape is competitive, and consumers are always looking for something new and exciting. However, studies of user behavior and the fundamental human desires that drove the success of previous apps can inform the creation of compelling and engaging products.

Q: How do apps effectively grow in the face of the changing landscape?

Word of mouth remains a powerful acquisition channel, and apps that go viral and provide value through network effects have the potential for rapid growth. Platforms like TikTok still offer organic reach, although entry barriers are higher compared to a couple of years ago. New platforms like TikTok ads provide low-cost advertising opportunities, but the effectiveness may decline over time. Additionally, unexpected acquisitions driven by user demand can also propel an app's growth.

Q: Are there any surprising apps that made it to the top charts?

Some surprising apps that made it to the top charts include Talking Ben the Dog, a kids' educational science game; the 7-Eleven app, which gains popularity on Free Slurpee Day; and the NOAA climate app that reached number one during Hurricane Ida. These apps demonstrate how real-world events and activations can drive app downloads and user engagement.

Q: What trends should we look out for in 2023?

The early leader for 2023 is Temu, a commerce app developed by a Chinese company called Pinduoduo. Trends to watch out for include the rise of new commerce apps, the gamification of good behaviors, and the evolution of subscription pricing models. The App Store will continue to offer opportunities for innovative apps that cater to changing consumer behaviors and leverage new platform features.

Takeaways

The App Store presents a unique opportunity for developers to build and monetize mobile apps quickly. The top apps of 2022 showcased a shift towards authenticity, interactivity, and smaller, close-knit social experiences. While reaching the number one spot is challenging, apps can capitalize on new technology and behavioral trends to drive growth. Retention and monetization strategies like in-app purchases, subscriptions, and partnerships with insurers offer various paths to success. Mimicking successful apps of the past can help inform product development, but new and compelling experiences are essential to stand out in a competitive landscape. As the App Store continues to evolve, staying ahead of trends and capitalizing on user behavior will be crucial for app success in the future.

Summary & Key Takeaways

  • The top apps of 2022 included social media platforms like BeReal and TikTok, as well as newcomer Gas App, signaling a shift towards authenticity and interactive experiences.

  • Other notable trends in app categories included the rise of widgets, AI-powered apps, and anonymous social apps, each offering unique opportunities for user engagement.

  • The difficulty of reaching and maintaining the top spot was highlighted, with the need for a strong product, network effects, and innovative approaches to retain users.

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