what the top 50 apps do with iap that the rest of us don’t

What the Top 50 Apps Do With IAP That the Rest of Us Don’t

MIKE HINESDEVELOPER EVANGELIST, AMAZON

@MikeFHines mikehines45

[email protected]

CREDIBLY INNOVATE PHOTO HERE

IAP: Way beyond the item list

TODAY’S AGENDA

The top 50 vs. the rest of us

How they did it

What we can do

Free apps are very ‘now’.And probably tomorrow too.

In-app purchases generated only 53% of revenue in the

Apple App Store for iPhone in January 2012 in the U.S.,

But generated a record 76% in February

2013 clearly demonstrating the success

of this monetization method

Distimo http://www.distimo.com/blog/2013_03_publication-how-the-most-successful -apps-monetize-their-user-base/

Garter is forecasting that, by 2017,

94.5 PERCENT OF DOWNLOADS WILL BE FOR FREE APPS

Garter – http://www.gartner.com/newsroom/id/2648515

IN APP PURCHASING - TYPES

ConsumablesThings that get used up.

EntitlementsThings that the user gets to keep.

SubscriptionsThings that the user gets as long as they keep paying..

IN APP PURCHASING - CURRENCY

Soft-CurrencyEasy to earn, easy to purchase, inflation compatible.

Hard-CurrencyInflation resistant, hard to earn, easy to purchase.

Top 50 vs. the rest of us

Cohort Analysis

Group A: Top-50 Grossing

Source: Amazon Appstore, March 2014

Group B: Rest of Freemium

Day 0: Installs


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installe

d

Day 0: Active Users


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In

active

5958

active

Day 0: Uninstalls




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Iiiiiiiiiiiiiiiiiiiiiiii

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uninstalled

5958

active

Day 0: Paying Users


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uninstalled

5958

active

33

paying

Day 0: Engagement


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iiiiiiiiiiii1318

uninstalled

5958

active

33

paying

# of sessions / active

session length / active(minutes)

× =

avg. session length(minutes)

6.9

7.4

2.6

2.9

18

21.6

Day 0: Revenue


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=×

# of items / paying

10

0%

11

2%

avg. selling price

10

0%1

36%

10

0%

15

4%

ARPPU

1318

uninstalled

5958

active

33

paying



× =


6.9

7.4

2.6

2.9 18

21.6

1 Day Later…


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×


1725

uninstalled

3437

active

11

paying

=×

# of items / paying

100%

106%

avg. selling price

10

0%10

7%

10

0%1

14%

ARPPU

6.7

7.7

3.2

3.5

21.2

27.5=

3 Days Later…


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×


1928

uninstalled

1923

active

=×

# of items / paying

100%

107%

avg. selling price

10

0%12

2%

10

0%13

1%

ARPPU

5.9

7.9

2.6

3.2

15

23

=

1 Week Later…


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×


2032

uninstalled

1418

active

=×

# of items / paying

100%

102%

avg. selling price

10

0%1

21%

10

0%1

24%

ARPPU

5.7

7.4

2.6

3.2

15

23=

2 Weeks Later…


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iiiiiiiiiii

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×


2134

uninstalled

1014

active

=×

# of items / paying

100%

111%

avg. selling price

10

0%

10

8%

10

0%12

0%

ARPPU

5.7

7.3

2.5

3.1

14.2

22.6=

1 Month Later…


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× =


2236

uninstalled

48

active

=×

# of items / paying

10

0%

103

%

avg. selling price

10

0%

12

8%

10

0%

13

1%

ARPPU

5.9

7.3

2.4

3.114.1

22.1

Hours Since App Download

IN-APP PURCHASING BY HOUR


0 24 48 72 96 120 144 168 192 216 240 264 288

WHAT WE LEARNED

The top have higher average price pointsYou can charge more in the right place and time.

Session length and count are importantRetention is not the only important metric.

What the top 50 do differently

THE TOP DEVELOPERS KNOW THE NUMBERS

?

ENGAGE

CUSTOMER

EARLY

KEEP THEM

IN THE

GAME

GIVE THEM A

REASON TO

COME BACK

37% of users who will purchase, purchase

on the first day

48% of repeat purchases happen within one

hour of a previous purchase

64% of revenue comes from 3rd order +

74% of revenue occurs after first 7 days

56% of revenue occurs after first 30 days

Games with bigger selection

RECEIVE MORE

ORDERS PER

CUSTOMERDevelopers that add new items regularly are able to

re-engage their paying customers. 1.14% of the

customers generate 30% of sales.


69%

100%

145%

1-5 Items 6-10 Items

11-15 Items

ARPPU by # of IAP items for sale

Apps with tutorials that introduce IAP

items

HAVE A 2.5x HIGHER

CONVERSION RATESource: Amazon Appstore, July 2013

Apps showing users how to “consume”

GET MORE REPEAT

ORDERSGames that providing a post-purchasing tutorial

generated 65% more repeat orders than the

market average.


Conversion Rate

INDEX: Average = 100%

Don’t confuse your customer

OFFER VARIETY,

BUT NOT TOO MUCH


147%

101%

52%

0%

50%

100%

150%

200%

1-5 Price Points

6-10 Price Points

11-15 Price Points

Apps that made it easy to shop

INCREASED REVENUE 75% (ARPPU)Source: Amazon Appstore, March 2014

Most of us have too much

CONCENTRATION ON LOW

PRICESTotal Marketplace: Assortment by Price Point


31%29%

7%

12% 11%

5%3%

1%

14%11%

6%3%

16% 16%

11%9%

0%

10%

20%

30%

40%

0.99 1.99 2.99 4.99 9.99 19.99 49.99 99.99

% of Assortment % of Sales

We find that the

TOP GAMES ARE MORE

BALANCED


Top 50 Apps: Assortment by Price Point

28%

15%

10%13%

11% 9% 9%5%

32%

19%

7%4%

10%12%

5% 4%

0%

10%

20%

30%

40%

0.99 1.99 2.99 4.99 9.99 19.99 49.99 99.99

% of Assortment % of Sales

WHAT WE LEARNED

Games with bigger selection

RECEIVE MORE ORDERS

Tutorials that introduce in-app items

HAVE HIGHER CONVERSION

Showing users how to “consume”

GETS REPEAT ORDERS

Treating in-app items like a catalogue

MAKES IT EASY TO SHOP

1.14%

of paying customers generate

30% of sales

+60%

Increase average

selling price over 30 days

How you can increase session count and minutes per session

REDUCE BARRIERS TO FREQUENT

USE

Tuning Game Difficulty

WILL ENCOURAGE

LONGER SESSIONSToo hard, and users will abandon. Too

easy, and they can get bored. Just right,

and it becomes addictive!

Image courtesy of FreeDigitalPhotos.net

Adopt Social: Leaderboards and awards

CAN CREATE BUZZ

AND KEEP USERS

ENGAGEDThis will result in more friend-to-friend marketing

as players share their achievements and ranks.

Players will also compete with friends and leaders

and stay engaged.

Adopt Social

SOCIAL ENGAGEMENT

DRIVES ADDITIONAL

SESSIONS

Hosting Special Events

WILL ENCOURAGE

MORE ENGAGEMENTOffering special levels and unique item rewards

during a specific time window will generate

excitement and participation.

Design IAP into the

fabric of your game

MAKE IT

EASY TO BUYOffering ways to buy your IAP

items when they are needed

will increase conversion.

To sell more IAP items,

BE CLEAR

ABOUT VALUEMake it obvious what the

benefit is for buying different

price items. Confused

customers don’t buy anything.

WHAT WE LEARNED

Make it quick to start playing

REDUCE BARRIERS TO FREQUENT USE

Nobody likes a pushover (or a bully)

TUNE GAME DIFFICULTY

Obligations to friends (even online friends) matter

DESIGN FOR SOCIAL ENGAGEMENT

Treating in-app items like a catalogue

MAKE BUYING EASY WITH OBVIOUS

VALUE

How Did We Do? http://bit.ly/Top50Survey

Contact us: forums.developer.amazon.com

developer.amazon.com/help/contactus.html

Follow us:

/AmazonAppstoreForAndroid

@AmazonAppDev @MikeFHines

developer.amazon.com/blog

Unattributed images sourced from Creative Commons

http://bit.ly/Top50Survey





http://creativecommons.org/publicdomain/zero/1.0/deed.en

what the top 50 apps do with iap that the rest of us don’t

Technology

group b

active users group

revenue group

amazon appstore

engagement group

grossing source

session length minutes

day later group