In-App Purchases Make a Lot of Money

revenue in-app purchase

It looks like in-app purchases are going a long way in making revenue for developers. This is good news for them, but can be a hassle for consumers in some cases, at least for those who don’t like in-app purchases.

The chart above shows how revenue breaks down. Free apps that offer extras make a large portion of app revenue (71%). Meanwhile, paid apps that offer purchases make the least (5%). We figure that it’s because users feel they already paid for the app and don’t want to pay extra. Somewhere between the two are the apps are apps that are just paid once upfront (24%).

In-app purchases have grown more popular in recent times thanks to the potential for an endless stream of revenue. For instance, a 99-cent game only has the potential to make 99 cents (though it will earn a lot of impulse buys). However, a free game with small, 99-cent to $1.99 add-ons has the potential to keep making money, even if a only small percentage of the people who download it make purchases.

That said, apps with these kinds of purchases have been subject to some scrutiny, because of kids purchasing thousands of dollars of stuff without their parents’ consent. Perhaps the iPhone 5S’ fingerprint sensor can do something to help cut back on such purchases.

[via Synthtopia]

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