TikTok reaches $9 Million through in-app purchases – an increase of 500% from last year

Popular video app TikTok has been gradually increasing its revenue from the different advertising strategies it implements. However, a small portion of its income is garnered from in-app purchases – that is around $9 million in May, according to a report published by Sensor Tower.

The numbers in the report represent around 500% year-over-year growth from the $1.5 million recorded in May 2018. It is also estimated to be 22% up from April’s $7.4 million.

On the contrary, TikTok is not putting a lot of emphasis to improve its in-app purchases and only focusing on driving user growth. This is because the developers behind the Beijing-based app know that putting some of its best features behind a paywall can risk user adoption and engagement – especially since the app is seeing unprecedented growth in countries like India where it boasts over 200 million registered users while 120 million monthly active users.

In fact, the app surpassed Facebook and became the most downloaded social networking app in the first quarter of this year. The app is now trying to get more advertisers to enhance its monetization efforts by signing up brands like Pepsi, Shaadi.com, Snapdeal and Myntra.

Meanwhile, the report from Sensor Tower clarifies that Indian user-base only accounts for half a percent on the in-app purchases and reported to be around $45,000.

Instead of offering the users an option to purchase, advanced video filters and effects, TikTok has enabled coins that can be used to buy gifts for the live streamers. Through this motive, iOS users in China have spent $5.9 million of the total $9 million spent on in-app purchases in May – accounting to nearly 65%.

In the USA and Canada, the app is seeing around $2 million or 22% of the app’s gross revenue.

Nevertheless, the installs for TikTok are slowly increasing. In their report, Sensor Tower noted that around 56 million users worldwide installed the app for the first time – a 27% increase from April. Till date, the app has seen 1.2 billion installs. However, the company has not yet publicly declared its recent monthly actives, which was around 500 million last summer.

The report also said that the app is expected to pass the $100 million threshold of life-to-date user spending by this month. Currently, spending is reported to be $97.4.

TikTok in-app purchases at record high
Photo Joe Scarnici/Stringer/Getty Images

Read next: What are the sources for people to find news on Smartphones?
Previous Post Next Post