6 Statistics on the Multi-Billion On-Demand Mobile App Economy
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6 Statistics on the Multi-Billion On-Demand Mobile App Economy

Prateek Saxena
By Prateek Saxena| Saturday, August 4, 2018 06:53 AM |8 min read
Statistics on the Multi-Billion On-Demand Mobile App Economy

86.5 Million Americans have used an on-demand service

The Investment round in the on-demand mobile app economy reached $10,293 Billion in Q4, 2017. 

These are just a few validatory examples that prove how on-demand startups like Uber and Netflix have given birth to a market that both users and angel investors are partial about.

What started with an on-demand ride sharing app has now extended into a number of different market segments ranging from grocery delivery to at-home maintenance services.

The present state of on-demand mobile app startup economy is such that no matter what industry you look into, you will find an active on-demand mobile app development company working to make it real – time.

Now, even at a time when millions of mobile users are happily spending money to avail the perks of the convenient at-door service, there are businesses that are still on the fence when it comes to entering the on-demand market space. And the reason behind this is the notion that the on-demand economy has now become a bubble that is going to burst.

But we have statistics that prove otherwise.

On-Demand Mobile App Economy Statistics

1. On-demand app economy is clasping onto the Investors’ Attention

Business models of on-demand startups such as Uber, Airbnb, and Bird e-Scooters, which form the on-demand economy, are famous for the fundings that they receive from angel investors to get them the resources they need to grow further.

The market that the on-demand industry has captured is the same which investors strive to take a share of. A match that has brought a rise in the funding to on-demand startups. There is a good percent of investors who couldn’t be a part of the trend when the uber economy was getting incepted but are now prepared to book their share.

The investment rounds focused on funding to on-demand startups that started in 2014 with $74 Billion reached $10,293 Billion in the last quarter of 2017. And if you look into the detail of the funding rounds in the on-demand economy statistics, you will find that the major portion of the funding has been coming in from the Seed or Angel Investors.

On-Demand Global Deal Share

Source: CBInsight

2. The on-demand market revenue has been growing by a Whopping Number

What was just an introductory trend has now become mainstream with increased revenue count. It is not just the domain that is witnessing great numbers in terms of revenue and profit, the growing revenue chart is making a regular appearance in the individual on demand player’s Profit and Loss statement as well.

This growth in revenue can be attributed to a number of factors like the ease that users get at the back of every on-demand app experience or the fact that the on-demand industry has emerged as the ideal work economy for the millenials.

This growing revenue number that has now become prevalent in the on-demand mobile app startup industry is only going to strengthen further – a statement that has been validated by PwC. According to a PwC report, the on-demand economy revenue which was $14 Billion in 2014 will reach $335 Billion by the time we reach 2025.

Estimated On-Demand Market Revenue

Source: PwC

3. The amount of spending witnessed by the On-Demand Mobile App Economy is on a Rise

Between 2016 and 2017, the amount that users are spending for ordering/booking on-demand service app, has only risen.

According to the data collected by the National Technology Readiness Survey in the U.S., it was estimated that the total spending on the on-demand mobile app services would increase from $48 Billion n 2016 to $75.7 billion in 2017 – an increase amounting to 58%.

The segments of the on-demand startup market, which have witnessed the maximum growth consist of – housing items –  from $5 billion in ‘16 to $10.6 billion in ‘17, transportation, which moved from $6.8 billion in ‘16 to $14.2 billion in ‘17, and lastly food delivery category, which shifted to $8.2 Billion in 2017 from $3.9 billion in 2016.

Seeing this growing spending number, Rockbridge estimated that the number of on-demand mobile app startup consumers would reach 56 Million by the end of 2018 and 93 Million by the time we hit 2022.

On-Demand Economy Consumer Spending (Billions) by Category,2017

Source: Rockbridge

4. Ease of Finding a Service Online is the main reason why people use On-Demand App Services

Awareness of the on-demand services and the market in general has near about doubled between the end of 2016 and end of 2017. 20% of the US users said that they have heard about on-demand industry in 2016. And the number then increased to 34% by the end of 2017.  

The rise in awareness has brought in a rise in the perceived advantage that users are getting by using the on-demand services. The main advantages include – The ability to find service online on an app (70%), the benefit of paying and tracking the progress of the delivery person on the app (62%), and lastly, the perk that come attached with being connected with other person in place of a business (52%).  

The advantages’ perception have grown from 2016 to 2017, specially the perks of using an app to book and track the service delivery person. Now, although connecting the user directly to the service provider is the main aim of the on-demand market, the benefit comes with the highest perceived disadvantage count from among all three.

Perceived Advantages and Disadvantages of Features of the On-Demand Economy

Source: Rockbridge

5. On-Demand service users are Educated, Belong to Urban Localities, and Have a Stable Household Income

Out of all the US on-demand users that were surveyed, Rockbridge found that most of the users belong to this demographic segment –

On Demand Mobile App Services Demographic Segment

  • 59% of the on-demand users are male
  • 55% of the user belong to the 25 – 44 years age group
  • 54% of the service user lives in the suburb while 18% reside in inner city
  • 68% reported an yearly household income of around $50,000, while over 47% belonged to a household income of $75,000 minimum
  • 45% have a college degree

6. The maximum demand for the On-Demand Services comes from the Early Adopter Class of Users

The adoption rates in on-demand industry can be seen coming in mainly from the “techno-ready” segment.

In 2017, the market penetration coming from the early adopters was around 41%, which is greater than double the market penetration of over 19% from 2016.  In addition to that, the penetration from Pioneers, was 24%. Lastly, there was a percent of Avoiders as well. However, the gap of avoiders was seen closing in between 2016 and 2017 – a sign of potential from the low techno ready segments.

One evident sign that came out by analysing the adoption rate of the on-demand sector was that the high growth among Explorers that the long term size of of the market would be substantial.

Perceived Advantages and Disadvantages of Features of the On-Demand Economy

Source: Rockbridge

While all of these statistics validate a profitable and stable state of the on-demand economy at the present time, what really matters to businesses looking to make an investment in the domain is knowing what its future holds.

The Future of On-Demand Economy

It is undeniable how on-demand is changing the world around us, as we know it. No matter which business segment you belong to, chances are that someone in your industry would be thinking about investing in the on-demand market.

And this un-altering demand for the on-demand services is not just the truth of the present day, the future has a similar story to share. The future of on-demand lies in a number of categories. Let us look at the major ones, which you should think of expanding your business portfolio into.

A. Hyperlocal

This is an on-demand model that revolves around the local provisioning of services and goods. This ecosystem mainly operate within a few kilometer radium only. An example of this would be Roadrunner or Swiggy.

B. e-Scooters

Ever since Bird came up with their e-Scooters in San Francisco, the demand for e-Scooter app development has been on a constant rise. Brands are now looking to enter the segment that the investors are clearly partial about.


C. Self-Storage Market

More than 30% of the US citizens have extra space than they actually need and at least 40% of the citizens face the problem of lack of storage space. These on-demand apps are a solution to that. Using apps like Cuft, you can create a platform for people who need space to meet people who have it in excess and make the former use the space as a storage space.

Now that you have seen how the on-demand category is one that have established itself as a secure market, both of the present time and of the future, let us now finally look into the one factor that is a question that every Entrepreneur who is looking to enter the on-demand market is seeking answer to –

How Much Does it Cost to Develop an On-Demand Mobile App

When an on-demand app development company develops an on-demand app, they develop an app that caters to three people – the user, the person delivering the service, and the business. And, the UI and app flow is entirely different in all of them, which adds on to the How to Build a Successful On-Demand Delivery App to a great extent.

Along with that, the category calls for a number of features inclusion like in-app payment, real-time sync, real-time tracking, chat support, rate and review support, and notifications, among many others. Since through one on-demand service app, a mobile app development company is developing three apps, the attached cost of the end on-demand mobile app is fairly high.

Keeping everything into consideration, the creation of On-Demand Startup Apps like UberEats or Lyft would take somewhere around 2000 and above hours. Now, multiply this number with the average hourly hours, and you will have with you the cost of on-demand mobile service app.

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Prateek Saxena
About The Author

Prateek Saxena is the Co-founder of AppInventiv, one of the fastest-growing mobile application development companies, based in Noida, India. With an extensive experience in Sales, he has established himself as a highly-focused user experience expert and product strategist, and as one who is always ready to take the new challenge to drive value to the company.He’s an energetic leader, effective communicator and a strong motivator, with a commitment to relentless improvement and innovation. He has, so far, mentored more than 100 startups and entrepreneurs worldwide, and is eager to help many others in planning their mobility roadmap.

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