Freemium Apps and In-App Purchases Booming
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Developers should really be paying attention to Distimo reports. New data featured by the analytics giant indicates that 72% of the revenue generated by the App Store is the result of in-app purchases. When you consider that only 4% of the apps found in the app store contain these gold mines, that figure becomes even more shocking (and impressive).
Oh, and in case you were wondering, 48% of those in-app purchases, the ones making all that money, were generated out of apps being offered and downloaded for free. This is compared to 24% coming out of paid-for apps.
People may groan about the Apple approach to generating app store revenue, especially as they have fine tuned their policies. But even though they may be taking their (rightful) cut of your profits, they are giving you something very valuable in return: the impulse purchase. Anybody with a payment method entered into their iTunes account can make purchases with a click and not have to leave the couch to grab their wallet. Apple has made this process so fast and hassle-free, people have a virtual basket full of smurfberries before they have changed their minds. Not that I speak from personal experience of course…
It isn’t just how easy it is to spend money in the App Store though, it’s about trust. It doesn’t matter whether I’ve heard of the developer I’m buying from. I don’t need to contemplate whether they are legit and who designed their payment gateway. As it appears to me, my purchases are made through Apple.
Not to mention, in-app purchases make sense. Your audience is captive. They have your app loaded up on their device and they are enjoying it. Once they close it and open the next one, it’s the digital equivalent to having walked on to the next store down the street.
In-app purchases allow consumers to purchase virtual items that hold value in their respective apps. These items may help you to progress in a game, offer additional levels or features or be purely aesthetic.
Distimo is a privately owned company headquartered in Utrecht, The Netherlands. Since their launch, Distimo has become a trusted source of information, marketing themselves as “providing valuable insight into the app store market for developers, carriers and device manufacturers.”
Are those companies moving their apps out of the App Store to evolve into HTML 5 based web-apps making a big mistake? How many of you developers out there are now considering how an in-app purchase of some sort could be added to your current offerings? Are there untapped in-app purchase opportunities?
