Mike Hines "What the Top 50 Apps Do With In App Purchasing That The Rest of Us Don’t"

1. WHAT THE TOP 50 APPS DO WITH IAP THAT
THE REST OF US DON’T
Reach  Engage  Earn
MIKE HINES
DEVELOPER EVANGELIST, AMAZON
@MikeFHines mikehines45
mihines@amazon.com

2. I N T R O D U C T I O N
Mike Hin es
Developer Evangelist, Amazon Appstore
@MikeFHines
Founder @ 2 Financial Services Startups
Founder @ 2 Software Startups
QA Engineer @ Now Software
QA Manager, Product Manager @ Microsoft
Evangelist @ Amazon.com
Mentor @ GameFounders, Dev Bootcamp
Games Judge @Casual Connect Indie Prize, White
Nights, and Pocket Gamer Very Big Indie Pitch
Speaker @ GDC, GDCE, Casual Connect, Pocket
Gamer Connects, AnDevCon, White Nights, CES,
PAX Dev

3. How the Top 50 apps did
vs. the rest of us

4. Cohort Analysis
Group A: Top-50 Grossing
Source: Amazon Appstore, March 2014
Group B: Rest of Freemium

5. Day 1: Installs
Group A: Top-50 Grossing
iiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiii
Source: Amazon Appstore, March 2014
Group B: Rest of Freemium
iiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiii
100100
installed

6. Day 1: Active Users
Group A: Top-50 Grossing
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiii
Source: Amazon Appstore, March 2014
Group B: Rest of Freemium
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
Iiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiii
4142
In
active
5958
active

7. Day 1: Uninstalls
Group A: Top-50 Grossing
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiii
Source: Amazon Appstore, March 2014
Group B: Rest of Freemium
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
Iiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiii1318
uninstalled
5958
active

8. Day 1: Paying Users
Group A: Top-50 Grossing
iii
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiii
Source: Amazon Appstore, March 2014
Group B: Rest of Freemium
iii
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiii1318
uninstalled
5958
active
33
paying

9. 2.6
2.9
Source: Amazon Appstore, March 2014
Day 1: Engagement
Group A: Top-50 Grossing
iii
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiii
Group B: Rest of Freemium
iii
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiii1318
uninstalled
5958
active
33
paying
# of sessions / active
session length / active
(minutes)
× =
avg. session length
(minutes)
6.9
7.4
1822

10. 6.9
7.4
2.6
2.9
Day 1: Revenue
Group A: Top-50 Grossing
iii
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiii
Source: Amazon Appstore, March 2014
Group B: Rest of Freemium
iii
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiii
=×
# of items / paying
100%
112%
avg. selling price
100%
136%
100%
154%
ARPPU
1318
uninstalled
5958
active
33
paying
# of sessions / active
session length / active
(minutes)
× =
avg. session length
(minutes)
18
22

11. Source: Amazon Appstore, March 2014
1 Day Later…
Group A: Top-50 Grossing
ii
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiii
Group B: Rest of Freemium
ii
Iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiii
# of sessions / active
session length / active
(minutes)
×
avg. session length
(minutes)
1725
uninstalled
3437
active
11
paying
=×
# of items / paying
100%
106%
avg. selling price
100%
107%
100%
114%
ARPPU
6.7
7.7
3.2
3.5
21
27=
# of sessions / active

12. 3 Days Later…
Group A: Top-50 Grossing
iiiiiiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiiiiii
Source: Amazon Appstore, March 2014
Group B: Rest of Freemium
iiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiii
# of sessions / active
session length / active
(minutes)
×
avg. session length
(minutes)
1928
uninstalled
1923
active
=×
# of items / paying
100%
107%
avg. selling price
100%
122%
100%
131%
ARPPU
5.9
7.9
2.6
3.2
15
25
=
# of sessions / active

13. 1 Week Later…
Group A: Top-50 Grossing
iiiiiiiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
Source: Amazon Appstore, March 2014
Group B: Rest of Freemium
iiiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiii
# of sessions / active
session length / active
(minutes)
×
avg. session length
(minutes)
2032
uninstalled
1418
active
=×
# of items / paying
100%
102%
avg. selling price
100%
121%
100%
124%
ARPPU
5.7
7.4
2.6
3.2
15
24
=
# of sessions / active

14. 2 Weeks Later…
Group A: Top-50 Grossing
iiiiiiiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
Source: Amazon Appstore, March 2014
Group B: Rest of Freemium
iiiiiiiiiii
iiiiiiiiiiiiiiiiiiiii
# of sessions / active
session length / active
(minutes)
×
avg. session length
(minutes)
2134
uninstalled
1014
active
=×
# of items / paying
100%
111%
avg. selling price
100%
108%
100%
120%
ARPPU
5.7
7.3
2.5
3.1
14
22=
# of sessions / active

15. 1 Month Later…
Group A: Top-50 Grossing
iiiiiiii
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
Source: Amazon Appstore, March 2014
Group B: Rest of Freemium
iiii
iiiiiiiiiiiiiiiiiiiiiiii
# of sessions / active
session length / active
(minutes)
× =
avg. session length
(minutes)
2236
uninstalled
48
active
=×
# of items / paying
100%
103%
avg. selling price
100%
128%
100%
131%
ARPPU
5.9
7.3
2.4
3.1
14
23
# of sessions / active

16. Hours Since App Download
IN-APP PURCHASING BY HOUR
Source: Amazon Appstore, March 2014
0 24 48 72 96 120 144 168 192 216 240 264 288

17. PRICE INCREASES OVER TIME
Days User Owned App
80%
90%
100%
110%
120%
130%
140%
150%
160%
170%
1 4 7 10 13 16 19 22 25 28
Source: Amazon Appstore, March 2014
+60%
average
selling price

18. WHAT WE LEARNED
The top have higher average price points
You can charge more in the right place and time.
Session length and count are important
Retention is not the only important metric.

19. What the top 50 do differently
-- Selling

20. THE TOP DEVELOPERS KNOW THE NUMBERS
?
ENGAGE
CUSTOMER
EARLY
MAKE IT
EASY TO
COME BACK
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

21. THE TOP DEVELOPERS KNOW THE NUMBERS
?
ENGAGE
CUSTOMER
EARLY
MAKE IT
EASY TO
COME BACK
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

22. Apps with tutorials that introduce IAP
items
HAVE A 2.5x HIGHER
CONVERSION RATESource: Amazon Appstore, July 2013

23. Apps showing users how to “consume”
GET MORE REPEAT
ORDERS
Games that providing a post-purchasing tutorial
generated 65% more repeat orders than the
market average.
Source: Amazon Appstore, March 2014

24. Games with bigger selection
RECEIVE MORE
ORDERS PER
CUSTOMER
Developers that add new items regularly are able to
re-engage their paying customers. 1.14% of the
customers generate 30% of sales.
Source: Amazon Appstore, March 2014
69%
100%
145%
1-5 Items 6-10
Items
11-15
Items
ARPPU by # of IAP items for sale

25. Conversion Rate
INDEX: Average = 100%
Don’t confuse your customer
OFFER VARIETY,
BUT NOT TOO
MUCH
Source: Amazon Appstore, March 2014
147%
101%
52%
0%
50%
100%
150%
200%
1-5
Price
Points
6-10
Price
Points
11-15
Price
Points

26. Where do apps
GENERATE
THE MOST
REVENUE
A 2016 study by Swrve
shows that disproportional
revenue is generated from
higher end price points.
© Swrve 2016 Mobile Monetization Report – used with permission

27. To sell more IAP items,
BE CLEAR
ABOUT VALUE
Make it obvious what the
benefit is for buying different
price items. Confused
customers don’t buy anything.

28. 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

29. What the top 50 do differently
-- Engagement

30. REDUCE BARRIERS TO FREQUENT USE

31. Tuning Game Difficulty
WILL ENCOURAGE
LONGER SESSIONS
Too hard, and users will abandon. Too
easy, and they can get bored. Just right,
and it becomes addictive!

32. An active community can
IMPROVE
ENGAGEMENT,
ACQUISITION AND
RETENTION
By creating:
• Influencers
• Content Creators
• Revenue Opportunities

33. Leaderboards and
Achievements are
THE MINIMUM BAR
FOR SOCIAL
ENGAGEMENT

34. FAN CREATED CONTENT IN YOUR COMMUNITY

35. To be in control,
HAVE A LOT
OF LEVERS
Measure with Analytics, and
use A|B Testing to fine-tune
everything from game
difficulty to IAP menu
choices.

36. Design IAP into the
fabric of your game
MAKE IT
EASY TO BUY
Offering ways to buy your IAP
items when they are needed
will increase conversion.
Apps that made it easy to shop
INCREASED REVENUE 75% (ARPPU)

37. WHAT WE LEARNED
Add social and tweak game difficulty to
INCREASE TIME AND COUNT OF
SESSIONS
Cater to your best and longest customers with clear value
DIFFERENTIATE YOUR IAP CATALOG
Give yourself control of your game in the wild
IMPLEMENT A|B TESTING

38. IF YOU ONLY DO ONE THING…
Cater to your best and longest customers
DIFFERENTIATE YOUR IAP CATALOG

39. IF YOU ONLY DO TWO THINGS…
Cater to your best and longest customers
DIFFERENTIATE YOUR IAP CATALOG
Make sure your IAP catalogs are
CLEAR ABOUT VALUE

40. IF YOU ONLY DO TWO THINGS…
Cater to your best and longest customers
DIFFERENTIATE YOUR IAP CATALOG
Make sure your IAP catalogs are
CLEAR ABOUT VALUE

41. Learn more:
http://bit.ly/top50iap
Follow us:
/MobileDevMikeHines
@MikeFHines
developer.amazon.com/blog
THANK YOU!

42. Learn more:
http://bit.ly/top50iap
Feedback:
Follow us:
/AmazonAppstoreForAndroid
@MikeFHines
developer.amazon.com/blog
http://bit.ly/GDCTop50