Mobile app usage to drop by 25 per cent on AI assistants —Study

BY 2027, mobile app usage will decrease by 25 percent due to Artificial Intelligence (AI) assistants, according to Gartner, Inc. Smartphone users will turn to AI assistants, such as Apple Intelligence, ChatGPT, Google Gemini, Meta AI, and others to replace apps for many functions.

In addition to the impact of AI assistants, apps will be consolidated across separate brands and companies, creating mobile app partnerships or consortiums to reach more users per app at scale and defray the cost of creation and maintenance.

“Complementary Metal-Oxide-Semiconductors (CMOs) should begin scenario planning for the impacts of decreased mobile app usage,” said Emily Weiss, Senior Principal for the Gartner Marketing Practice.

“Brands with low app engagement and retention will likely be first impacted – this will be a positive development for brands that are not overly reliant on driving revenue via apps as app development costs will decrease.

Other brands may be severely impacted by the disintermediation of users turning to AI assistants for services.

“The loss of app users will also result in the loss of first-party data collection and the ability to reach fewer users via mobile push notifications,” she added.

By 2026, over 1/3 of web content will be created for the purposes of Gen-AI powered search.

According to Gartner’s 2024 CMO Spend Survey of 395 respondents between February and March 2024, the average CMO allocated almost a quarter of their digital marketing budget to search.

Other than end users directly visiting a website, search currently drives more traffic to the average commercial enterprise website than any other referral source.

Given this, a loss of search-driven traffic due to algorithmic shifts by major search engines would result in tangible, negative commercial impact to any organisation.

“CMOs will need to direct their teams to hire talent with a strong understanding of how GenAI, and broader AI influences, impacts the performance of their content in search algorithms,” said Weiss.

“It will be important to upskill the function by investing in search and content talent with AI skillsets. These associates will need to have familiarity with creating or optimising content to train and rank within evolving search algorithms,” Weiss added.

By 2028, digital marketers will move 30 percent of their paid social budget to support advertising and partnerships on subscription-based channels.

It is becoming more challenging for CMOs to maintain, let alone grow, their reach and engagement among consumers.

This is especially true as consumers shift their tech and media behaviours away from social media, to other platforms and subscription-based channels.

Gartner’s 2024 CMO Spend survey found that since 2022, paid social has maintained the highest budget allocation for all digital media spend.

In 2024, B2C Marketing leaders reported allocating 14.3 percent for their digital channel budget to social media advertising (an increase from 12.3% in 2023).

“Closed group communities and subscription channels offer a potential alternative for social media weary consumers and content creators who want to do more than feed the algorithm,” said Weiss.

“Brands can leverage closed-group subscription channels – such as Substack, Patreon, and Discord – and the professional creators on them to reach relevant target audiences who are already engaging with content they self-selected into consuming,” he added.

By 2027, 85 percent of customer data will be collected from automated interactions or those led by AI agents. Current AI models, such as large language models (LLMs), lack the agency to autonomously execute tasks and adapt in complex environments.

However, as new levels of intelligence are added, new AI agents are poised to quickly become more capable and reliable as brands seek to address customer-facing use cases.

“There will be more AI agents than people, so while current approaches require humans in the loop, this idea will quickly become antiquated.

“Marketers will need to determine when and how they can trust AI agents to act on behalf of the brand and customers across key areas,” said Weiss.

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