How to Integrate In-App Purchases (IAPs) in Your Games & Applications
To integrate in-app purchases (IAPs) and/or microtransactions into your applications, set up a clear strategy that harmonizes with your product goals and user experience. This is necessary to generate revenue and support ongoing development and maintenance of your software. This guide outlines the process for implementing these payment models, with the goal of creating a revenue stream.
Conduct a Self-Assessment to Create Your Strategy
Before you begin writing your code, decide which monetization model you want to use. This is the first step that dictates all subsequent decisions. It’s not about what is possible, but what is best for your products and audience. Then ask yourself these self-assessment questions:
- What is the main value of my product? Is it a productivity tool that saves users time, a communication platform that creates connections, or a video game that delivers entertainment?
- Are my intended users going to pay this amount? Are they professionals who can expense their subscription, an informal user who wants small, spontaneous purchases, or a loyal gamer who needs every item?
- What is the status of the current competitive landscape? How do SaaS apps or video games in your niche monetize? Do they prefer a subscription, a pay-per-use model, or a combination?
- What are the long-term business goals? Do I want consistent, foreseeable revenue (subscriptions) or a high volume of small, recurrent transactions (micro transactions)?
Procedure for defining your IAP strategy:
Prijs: McKinsey’s research indicates there is a correlation between value-based pricing strategies and revenue growth in the 10-15% range. Remember, your pricing should be tied to the value a customer receives.
voor a design app, this could be based on the number of premium templates downloaded. For a communication tool, it might be the number of team members added.
For more tips, review our guide on how to set your video game pricing.
Klanten segmentatie: Users have different needs and budgets. A getrapte prijsmodel can influence the scope of the audience reached. For example, you could implement a basic tier for individual users, a mid-tier for small teams, and a premium tier for enterprises.
Free Checklist for Implementing In-App Purchases (IAPs)
Define your monetization strategy and choose the right IAP types for your app. Get:
-
A list of key metrics to track
-
Types of IAPs
-
Tips for a user-friendly purchase flow
-
en meer!
Define Your In-App Purchase Types
Based on your self-assessment, define the types of IAPs (In-App Purchases) that fit your strategy.
- Consumable IAPs: These are what users buy and use, such as extra lives in a mobile game or credits for an AI-powered image generator. This model is typical in apps and video games with high player activity.
- Non-Consumable IAPs: These are permanent unlocks, like an ad-free experience, a new character skin or a one-time purchase to gain a specific set of features. This approach is relevant to a freemium-model, possibly allowing users access to a premium version.
- Subscriptions IAPs: This is the pillar of most SaaS monetization models. Customers pay a recurring fee (monthly, annually) for continuous access to your service. This generates predictable revenue and is ideal for products that offer ongoing value.
Fortnite uses a hybrid model. The game is free-to-play, but players can buy a Battle Pass (subscription) for seasonal rewards or V-Bucks (consumable microtransactions) to purchase character skins and emotes. The game’s economic status has been substantially influenced by this strategy.
Free Checklist for Implementing In-App Purchases (IAPs)
Define your monetization strategy and choose the right IAP types for your app. Get:
-
A list of key metrics to track
-
Types of IAPs
-
Tips for a user-friendly purchase flow
-
en meer!
Implement the In-App Payments Infrastructure
Your choice of payment infrastructure affects revenue, compliance, and user trust.
Platform Gateways vs. Third-Party Solutions: You can use the native gateways provided by the Apple App Store and Google Play or a third-party merchant of record (MoR).
Platform Gateways: Offer a consistent user experience and establish a baseline level of trust. A common commission structure is 30%, which benefits the net revenue. The FTC’s settlement with Epic Games for unauthorized in-game purchases stresses the necessity of using trusted gateways, especially in videogames, to manage security and compliance.
Third-Party MoR (e.g., PayPro Global): A Merchant of Record, such as PayPro Global, can handle the entire e-commerce process, including global tax compliance, fraud prevention, and subscription management. This presents the option to sell outside app stores, which have an effect on revenue retention.
For iOS and Android apps, consider offering a link to an external web checkout. This approach gives users a choice and may be related to changes in direct revenue, as seen with Playtika’s 6.8% direct-to-consumer revenue change in Q3 2023. You can read our guide on how to avoid app store fees with external payments.
- Unified Revenue Management: PayPro Global acts as een merchant of record, consolidating revenue data from all your channels (in-app payments, web, etc.) into a single, unified dashboard. This solves the “siloed data” problem and provides a clear financial overview.
- Wereldwijde naleving van belastingwetgeving: The platform handles international sales tax, VAT, and GST rules, shifting operational responsibilities and team focus.
- Flexible Checkout: The availability of multiple gelokaliseerde betaalmethoden and currencies could be related to changes in conversion rates due to its potential effect on global audience accessibility.
- Abonnementenbeheer: The platform includes tools for het beheren van abonnementen, with automated dunning and renewal notifications that may affect involuntary churnpercentages.
Free Checklist for Implementing In-App Purchases (IAPs)
Define your monetization strategy and choose the right IAP types for your app. Get:
-
A list of key metrics to track
-
Types of IAPs
-
Tips for a user-friendly purchase flow
-
en meer!
Design and Integrate the User Interface
The user experience of your monetization strategy is as important as the strategy itself. The design of the purchase flow can affect the customer experience and ultimately influence sales figures.
- Transparantie: Clearly label all in-app purchases. The price, what the user is buying, and whether it is a one-time or recurring charge must be evident. This aims to establish reliability and minimize the occurrence of unforeseen charges.
- Naadloze integratie: The purchase flow should feel like a natural part of the app, not a disruptive advertisement.Place purchase prompts at moments of high customer interaction or need, such as after a user has finished a task and wants to unlock the next one.
- A/B-testen: Continuously A/B test different pricing, promotion placements, and checkout flows to see what resonates best with your audience. For example, test whether a “Pro” plan or a “Per-User” plan converts more effectively.
A/B Testing Pricing Tiers
|
Test Group |
Price Tier |
Waardepropositie |
Conversieratio |
|
Een |
$9.99/mo |
Basic features + premium templates |
4.2% |
|
B |
$12.99/mo |
Basic features + premium templates + advanced analytics |
3.5% |
Conclusion: In this example, the higher price point (Test Group B) had a lower conversion rate, implying that the added value of “advanced analytics” wasn’t worth the extra cost by the target audience.
Free Checklist for Implementing In-App Purchases (IAPs)
Define your monetization strategy and choose the right IAP types for your app. Get:
-
A list of key metrics to track
-
Types of IAPs
-
Tips for a user-friendly purchase flow
-
en meer!
Monitor and Reinvent
After launching, remember that the work doesn’t end there. A successful monetization strategy is a continuous process of analysis and optimization.
Key Metrics to Track:
- Conversieratio: The percentage of users who make a purchase.
- ARPU (gemiddelde omzet per gebruiker): The average revenue you generate from each user.
- LTV (Customer Lifetime Value): The total revenue you can expect from a single customer throughout their relationship with your software.
- afhaakpercentage: The percentage of paying users who cancel their subscriptions. Use our SaaS Churn Rate Calculator dit te monitoren.
Data-analyse: Use analytics dashboards to track user behavior and find opportunities. For example, if you notice a high conversion rate on a specific in-app payment, you can create more content or features in that category. Observed churn rates could be related to how users perceive the product’s cost in relation to its value proposition.
In a recent Swrve report, 2.2% of users make in-app purchases in free-to-play mobile games. This small percentage often accounts for the majority of revenue, illustrating the importance of targeting and retaining highly engaged users.
Conclusie
In-app payments present complexities but may contribute to the establishment of a viable business. A structured product assessment, selection of a suitable monetization model, and implementation of a reliable payment infrastructure, utilizing a solution like PayPro Global, may influence revenue generation and mitigate issues. Continuous monitoring and adaptation based on data is essential to your long-term success.
Veelgestelde vragen
-
Free-to-play games use IAPs as their primary revenue source, as they don’t have an upfront cost to download. They monetize their user base by offering optional items, content, or boosts that enhance the player experience.
-
It depends on how they are implemented. If IAPs give players a significant competitive advantage over non-paying players, it can create a “pay-to-win” imbalance that can frustrate the player base.
-
A consumable IAP is an item that can be used up and repurchased, such as in-game currency or extra lives. A non-consumable IAP is a one-time purchase that provides permanent access to a feature, like removing ads or unlocking a character.
-
IAPs allow SaaS apps to adopt a freemium model, offering a basic version of the service for free and charging for additional features or functionality. This strategy helps attract a large user base and provides a way to upsell to paying customers.
-
A subscription IAP is a recurring payment that provides users with access to content or features for a limited time. This model is common in apps that offer continuous value, such as streaming services or cloud-based software, and provides a predictable revenue stream for developers.
Klaar om te beginnen?
We’ve been where you are. Let’s share our 19 years of experience and make your global dreams a reality.
Nederlands 
English 
Español 
Português 
Português do Brasil 
Français 
Italiano 
Deutsch 
Polski 
Română 
Українська 
简体中文 
日本語 
한국어