Who’s Winning the AI App Revenue Race?

ChatGPT’s mobile app has seen impressive growth since its May launch – hitting 23 million downloads and nearly $2.39 million in consumer spending – yet it’s not the AI chatbot revenue leader. Apps like “Chat & Ask AI” and “ChatOn — AI Chat Bot Assistant” pulled in $3.38 million and $2.11 million, respectively, in September alone.

The competition is fierce, and it’s not just about chatbots. AI photo apps like “Remini” and “PicsArt AI Photo Editor” are also raking in significant revenue. These apps benefit from in-app purchases, often linked to users’ Camera Rolls, a feature ChatGPT lacks.

What’s driving this? App Store SEO plays a role; apps with generic names like “AI Chatbot — Nova” are ranking well for search terms users are likely to use. User retention is also strong for these apps, suggesting they continue to offer value beyond initial downloads.

However, the AI photo app market has also shown signs of volatility. Lensa, which went viral last year, saw its monthly installs plummet from 23 million to 400,000 and its revenue drop from $24 million to $739,000. This suggests that while photo apps may enjoy bursts of virality, sustaining user engagement is a challenge.

The key to long-term success in the AI chatbot market isn’t downloads or initial consumer spend; it’s sustained user engagement and adaptability. As AI evolves, so must these apps if they want to stay relevant and profitable.

Author’s note: This is not a sponsored post. I am the author of this article and it expresses my own opinions. I am not, nor is my company, receiving compensation for it. This work was created with the assistance of various AI models, including but not limited to: GPT-4, Bard, Claude, Midjourney, Stable Diffusion, and others.

About Shelly Palmer

Shelly Palmer is the Professor of Advanced Media in Residence at Syracuse University’s S.I. Newhouse School of Public Communications and CEO of The Palmer Group, a consulting practice that helps Fortune 500 companies with technology, media and marketing. Named LinkedIn’s “Top Voice in Technology,” he covers tech and business for Good Day New York, is a regular commentator on CNN and writes a popular daily business blog. He's a bestselling author, and the creator of the popular, free online course, Generative AI for Execs. Follow @shellypalmer or visit shellypalmer.com.



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