- Character.ai’s rapid growth in mobile app users.
- ChatGPT’s continued dominance in global web traffic.
- Character.ai’s appeal to a younger audience.
- $150 million Series A funding and its impact on Character.ai’s valuation.
- The founders’ backgrounds and their contributions to AI.
Character.ai, the innovator in AI application development that empowers users to craft their very own AI personas, is swiftly catching up to ChatGPT in the realm of mobile app utilization.
As per a recent analysis conducted by the astute market intelligence entity Similarweb, the iOS and Android applications of Character.ai, backed by the influential a16z, presently boast a burgeoning user base of 4.2 million active monthly enthusiasts within the United States.
In contrast, ChatGPT’s mobile apps lay claim to nearly 6 million monthly devotees in the United States.
This noteworthy surge comes in the wake of Character.ai’s triumphant debut in May of 2023 when the burgeoning startup proudly announced the achievement of an impressive 1.7 million installations during its inaugural week.
Naturally, it’s crucial to discern that installations do not invariably translate into active users, let alone dedicated ones.
The standard mobile application contends with a retention rate of merely 3% to 4% over 30 days, and disengagement rates surge above 40% after the same period, as per data discerned from the venerable mobile marketing authority, AppsFlyer.
Ergo, one can deduce that Character.ai has adeptly preserved a portion of its early adopters and cultivated its user engagement over the months since its inception.
Having said that, it’s important to acknowledge that ChatGPT remains unequivocally preeminent in the digital domain, primarily because a substantial number of Character.ai’s patrons exhibit a predilection for constructing and interacting with their AI conversational agents via their mobile devices, rather than through the conventional web interface.
On a global scale, Android data reveals that ChatGPT continues to maintain a substantial lead over Character.ai within the mobile realm, boasting a staggering 22.5 million monthly active adherents in contrast to Character.ai’s 5.27 million.
Nonetheless, what sets Character.ai apart is its striking appeal to a decidedly younger demographic compared to ChatGPT and other AI applications.
For instance, Character.ai’s web presence draws a formidable 60% of its audience from the age bracket of 18 to 24, a statistic that has remained resolute even as web traffic to ChatGPT has dwindled during the summer months.
In July, the 18- to 24-year-old demographic constituted a mere 27% of ChatGPT’s traffic, a decline from the 30% recorded in April.
The latest data further unveils that other AI providers, including Perplexity.ai, Midjourney, Anthropic, and Bard, all experience relatively lower adoption rates among the 18 to 24 age group, registering figures of 22.7%, 22.3%, 25.3%, and 18.46%, respectively, when compared to Character.ai’s commanding 60%.
For the third consecutive month, ChatGPT has also witnessed a decrease in global website visits, dwindling by 3.2% to 1.43 billion in August.
This decline follows a series of 10% drops in the preceding two months, as reported by Reuters, citing Similarweb’s authoritative dataset. Additionally, the average duration of visits to ChatGPT’s website has plummeted from an average of 8.7 minutes in March to a mere 7 minutes as of August.
Similarweb postulates that Character.ai’s resilience throughout the summer season may be attributed to its app being predominantly designed for entertainment purposes, as opposed to serving as a utilitarian tool for academic or research pursuits.
Notably, Character.ai’s website traffic experienced a minor dip during the summer months, which was adequately offset by a surge in mobile users embracing Character.ai’s iOS and Android applications.
The tide appears to be turning for ChatGPT, too. Similarweb’s findings indicate a nascent resurgence in ChatGPT’s web traffic coinciding with the resumption of the academic year in the United States. August witnessed a modest uptick of 0.4% in website visits for ChatGPT.
Concurrently, unique visitors surged by 3% on a month-over-month basis within the U.S. and by 0.3% globally in August, following declines in June and July.
Character.ai still possesses ample room for expansion within its user base, bolstered by a staggering $150 million influx of Series A funding earlier in the year, rendering the startup’s valuation at a substantial $1 billion.
Notably, the investment community exhibited profound faith in the visionaries behind Character.ai, namely Noam Shazeer and Daniel De Freitas, distinguished AI luminaries who formerly spearheaded a Google research team responsible for crafting LaMDA (Language Model for Dialogue Applications), a pioneering language model instrumental in enhancing conversational AI experiences.
At the juncture of a16z’s investment, GP Sarah Wang extolled the founders as “trailblazers in the realm of AI for nearly two decades.”
“They have engineered a formidable platform, encompassing an end-to-end fusion of both model and application, thereby affording Character.AI the capability to continually refine its product as a burgeoning populace embarks on the journey of crafting and engaging with its virtual characters,” Wang proclaimed.
Of course, it remains to be seen whether the younger demographic will persist in embracing Character.ai or if it will ultimately transpire as yet another fleeting AI phenomenon.
At the time of this composition, Character.ai has refrained from furnishing a formal response to Similarweb’s data analysis, though we remain vigilant for any potential insights they may choose to share.