Inside Africa's app market: Trends in 2023
Prashansa Shrestha, Content Writer, Adjust, Apr 12, 2023.
The app market in Africa is experiencing rapid growth, generating $800 million in revenue in 2022. This is due to the increasing number of young and technology-savvy users, as 40% of the continent’s population is under 15. The Global System for Mobile Communications (GSMA) predicts the region will have 100 million new mobile subscribers by 2025.
Africa's app market growth did, however, hit a roadblock in 2022. The smartphone market contracted by 18% in 2022 due to decreased consumer spending caused by inflation and economic uncertainties. This trend was not exclusive to Africa, and the good news is that mobile app downloads and usage are making a comeback in 2023.
An upward trend in app installs for 2023
Installs across all verticals grew an impressive 64% in Africa from 2019 to 2020 and increased by another 35% in 2021. However, in 2022, installs only saw a year-over-year (YoY) growth of 6%. Although installs were at an all-time high in the first half of 2022, they dipped by the end of the year. But things are looking more optimistic this year as installs in Q1 2023 were up by 10% compared to the Q4 2022 average.
We also looked at install growth for e-commerce, fintech, and gaming. E-commerce and fintech app installs surged 12% and 8% YoY in 2022. Gaming installs, following global trends, decreased by 1% from 2021 to 2022.
App sessions see slow but steady growth in 2023
App sessions for all verticals increased by 25% YoY in 2020 and 18% in 2021 in Africa. And while sessions reached new heights from January 2022 to July 2022, they dropped in the second half of the year.
While installs for all verticals have already shown an uptick in the first quarter of 2023, sessions are still catching up. Moreover, when we drilled down into specific verticals, we saw considerable growth across e-commerce, fintech, and gaming. In Q1 2023, e-commerce app sessions were 6% higher than the 2022 average, and fintech sessions were up by 19%. Additionally, sessions for mobile gaming were 16% above the Q4 2022 average.
User engagement increases in 2023
African users are spending more time in-app in 2023. The average session length for all verticals was 23.68 minutes in 2021, which decreased to 21.97 minutes in 2022. In Q1 2023, the session length climbed back to 22.93 minutes. This is good news for regional app marketers looking to maximize conversion opportunities.
The rise of fintech and super apps in Africa
In Africa, over 570 fintech startups are building financial inclusion from the ground up. Many of these companies offer mobile-based services, which have been facilitated by the increasing ownership of smartphones, declining internet costs, and expanding network coverages. Despite a slowdown in funding, the African fintech industry is expected to experience significant growth in the coming years. This is especially true because cash is still used in around 90% of transactions in Africa, indicating that fintech revenues have enormous potential to grow. In fact, experts predict that African fintech revenues could increase eightfold by 2025.
The growth opportunity in fintech is expected to be concentrated in eleven key markets, which account for 70% of Africa's GDP and half of its population. However, the opportunities in each market will differ depending on the digital maturity level across these countries. More advanced financial services, including B2B liquidity and regulatory technology such as anti-money laundering and KYC compliance, will likely be more innovative in economies with more mature economic systems and digital infrastructure, such as Nigeria and South Africa. Meanwhile, markets with growing financial systems and infrastructure, such as Egypt, are likely to see developments including underwriting, servicing, claims, and assessments in insurance; banking-as-a-service and embedded finance in operations and infrastructure; and buy-now, pay later (BNPL) services in retail and SME lending.
Super apps are also increasingly popular in Africa as they offer a convenient all-in-one solution for banking, messaging, shopping, ride-hailing services, and beyond. In Africa, where 85% of smartphone shipments consist of low-end and ultra-low-end devices, super apps are an ideal fit for this digital economy. These smartphones have limited storage capacity, making multi-service super apps more attractive. They enable users to avoid deciding what content to delete to download a new app.
Tips for to excel in the African app market
Here are some strategies for app marketers looking to build a strong brand presence and create innovative solutions that address the unique needs of African mobile app users:
- Focus on localizing your app: African mobile users have unique needs and preferences, and it's essential to tailor your app to their specific requirements. This includes localizing the app's language, content, and design to make it more appealing and accessible to African users.
- Leverage the growth of mobile money: Mobile money transactions in sub-Saharan Africa accounted for almost 70% of the total $1 trillion transacted globally in 2022. As mobile money is a significant driver of growth in the African market, app marketers should consider integrating mobile money services into their apps. This will make it easier for African users to pay for in-app purchases.
- Offer offline functionality: Many African mobile users have limited or intermittent internet connectivity, and offering offline functionality can help your app stand out in the region. Consider building features allowing users to access content and use the app even when not connected to the internet.
- Partner with local influencers: Influencer marketing is a powerful tool in the African app market, and partnering with local influencers can help increase the visibility and credibility of your app. Identify influencers with a strong following in your target market and collaborate with them to promote your app.
- Utilize mobile analytics: The behavior of mobile users in Africa is distinct from that of other regions. To better understand the customer journey and identify user trends, it’s crucial to use mobile analytics. Focusing on post-install measurement will also enable marketers to identify top-performing user acquisition channels and build solutions like predictive revenue models.
Ready to take your app to the next level? Download our 2023 edition of Mobile app trends: A global benchmark of app performance for in-depth analysis, actionable data, and key insights.