Checking In - How Disruptive is Pokémon Sleep, Really?

A couple of months ago a new app sporting the Pokémon brand appeared on the App Store and Google Play, and its purpose surprised me a little.

Pokémon Sleep is a Pokémon-themed sleep tracker led by mascot Snorlax, the sleepy Pokémon (for those who know).

Sleep tracking is a comfortable niche ruled by a small number of competitors, each hauling in millions of dollars every month. So, why not disrupt it?

That said, Pokémon Sleep is only disruptive in that it exists... Its features mirror other apps.

Can Pokémon Sleep beat the incumbents simply for its brand, and will it take away their demand or compete alongside them?

The app has been out for three months, so let's have a look at its revenue (estimates) to answer those questions.

Yes. Lots of yes.

Pokémon Sleep's modest first month, which almost beat the top competitor in terms of revenue, was nothing compared to its second month on the market.

In August, the app's first full month in the App Store and Google Play, Pokémon Sleep earned a whopping $5.8M of net revenue, according to our estimates. And that's net which means what's left after Apple and Google take their fees.

The competition remained fairly static...

I got excited by the number so let me rewind a bit and talk about why this is big.

Sleep Cycle and ShutEye® are the two popular sleep tracking apps you'll likely come across when searching for any combination of keywords that involve sleep and tracking. They've been the highest earners in the category consistently for quite a while now.

But 2023 hasn't been a great year for sleep tracking, especially not on the App Store "thanks" to Apple's addition of sleep tracking in the Health app. While not exactly the same or as featureful, competing with something pre-installed is challenging, especially as a paid solution.

Looking at revenue, the trend is pretty obvious. Both Sleep Cycle and ShutEye® saw revenue drop double digit percent between January and June - even before Snorlax made it on the scene.

Earning more than the leader on month one while the incumbents are already down is a great achievement. Growing to more than 4x their revenue on month two is just silly. The good kind.

Revenue dropped a bit in September to $4.4M, still 4x the competition.

Here's what's most interesting - It doesn't look like that revenue is coming out of the competitors. Pokémon Sleep is operating in a lane of its own likely monetizing fans of the brand more than users in need of a sleep tracker.

Pokémon Sleep's lack of proper ASO aids in that - Search for any combination of sleep and tracking and you won't find the app without swiping a whole bunch. A missed opportunity, yes, but probably by design because they simply don't care. They're targeting a different user pool.

I wonder what's the next niche for Pokémon to take on. Dare to guess?