When Do Players Purchase in Mobile Games?

The following is a guest post from Ankur Prasad, Head of Partnerships, Developer Marketing at Amazon[caption id="attachment_11277" align="alignleft" width="186"]

Ankur Prasad[/caption]Despite the foundational importance of monetization to free-to-play mobile games, a slew of great games don?t generate a lot of revenue from in-app purchases (IAP). In actuality, the vast majority of IAP revenue is generated by a small segment of games. At Amazon, enhancing IAP revenue for our devs is a top priority.To get to the bottom of this monetization paradox, we compared IAP trends among the top 50 games to similar titles outside the top 50. Next, we searched for commonality in the monetization strategies across the top 50 games. Let?s take a look at what we found.In-App Purchasing by Hour. We found out that regardless of a developer?s prior success, thriving in the competitive mobile gaming industry depends on engagement and retention?the benchmarks for mobile game success. Many devs put the cart before the horse?or, rather, the monetization strategy before the engagement strategy. As with any new user, retaining and engaging them is crucial to any monetization efforts. We discovered that by day seven (D7), 80 percent of users who install a game will not launch it again. However, the 20 percent of users that stick around in a game can mean a great deal to devs. The chart below visualizes IAP behavior by hour.

Surprisingly, the lion?s share of IAPs occur in the first 24 hours. In specific, we learned that roughly 18 percent of revenue is made during the first day. But the real story is the 82 percent of revenue that?s left. Although the chart doesn?t show it, the same pattern holds true well beyond 30 days.As previously mentioned, games lose 80 percent of its active users by D7 (168 hours in the case of the chart). But it?s important to note that after seven days, 74 percent of a game?s potential revenue is still there for the taking. By the 30-day mark, 54 percent of revenue is left on the table. Accordingly, it?s paramount for devs to pay attention to users that stick around for seven days as well as 30 days.

Price Increases Over Time. Devs should pay close attention to their loyal users because the average price these users are willing to pay for in-app items increases significantly over time. After looking at the chart above, devs are probably wondering how the top 50 games were able to increase the average selling price for their IAP items.We discovered that the top 50 games offer a more expensive selection of items to users who?ve been there longer. Once an average user has been using a game for 30 days, they will typically purchase premium content that?s 60 percent more expensive than content they could have purchased as a user on day one. Therefore, devs should consider presenting items at different prices based on a user?s lifetime.If you?d like to learn more about the findings of our study you can watch our presentation from GDC 14.