Character.ai Closes In on ChatGPT in U.S. Mobile App Usage

Character.ai, the innovative AI app enabling users to design their own AI characters, is gaining ground on ChatGPT in terms of mobile app usage in the U.S. Recent analysis by market intelligence firm Similarweb reveals that Character.ai's iOS and Android apps, backed by a16z, now boast 4.2 million monthly active users in the U.S., compared to nearly 6 million for ChatGPT's mobile apps.

This growth is particularly impressive given Character.ai's launch in May 2023 when the startup reported over 1.7 million installs in its first week. Retaining users is notoriously challenging in the mobile app space, but Character.ai seems to have effectively retained early adopters and grown its user base in the months since its debut.

However, ChatGPT still dominates the web space, likely because many Character.ai users prefer building and interacting with their AI chatbots on their personal mobile devices rather than through a website.

Globally, Android data indicates that ChatGPT still significantly outpaces Character.ai on mobile, with 22.5 million monthly active users for ChatGPT compared to 5.27 million for Character.ai.

Notably, Character.ai attracts a much younger demographic than ChatGPT and other AI apps, with nearly 60% of its web audience falling in the 18-24 age bracket. This demographic consistency persisted over the summer, even as ChatGPT's web traffic declined among this group.

In contrast, ChatGPT's web traffic among 18-24-year-olds decreased from 30% in April to 27% in July.

Similarweb's data also shows that other AI providers struggle to capture younger demographics in the 18-24 age group. Compared to Character.ai's 60%, competitors like Perplexity.ai, Midjourney, Anthropic, and Bard had percentages of 22.7%, 22.3%, 25.3%, and 18.46%, respectively.

ChatGPT has seen several months of declining global website visits, but this trend is beginning to reverse. In August, ChatGPT's web traffic increased by 0.4% in the U.S., and unique visitors grew by 3% month-over-month in the U.S. and 0.3% worldwide.

Character.ai is well-positioned for future growth with its substantial $150 million Series A funding, which valued the startup at $1 billion. Although numerous AI character generators exist, investors were drawn to Character.ai's founders, Noam Shazeer and Daniel De Freitas, AI experts who previously led a team at Google that developed LaMDA (Language Model for Dialogue Applications). This language model plays a crucial role in enhancing conversational AI experiences.

While Character.ai's success is promising, only time will tell if it can maintain its appeal among young users or if it will follow the trend of short-lived AI fads. Character.ai has not commented on Similarweb's data at this time, but we will provide updates if a response is received.