In-App Messaging: Tactics to Improve In-App Purchase Revenue

March 24, 2015

Britt Buckingham

buy-cash-coins-2116Now that we’ve explored what in-app messages are and shared some tips to getting starting, we want to dig a little deeper into your mobile marketing strategy. Let’s discuss tactics to help you generate revenue through your in-app messages.

Did you know that only 33% of US mobile users will pay for apps this year? The rest of the downloads go to free apps that generate revenue from either advertising or in-app purchases (IAPs).  

Knowing how to generate revenue from in-app purchases is incredibly important. According to a recent report by eMarketer, IAPs for mobile games in 2015 will total $1.82 billion. That’s 59.8% of all mobile game revenues. And they’re expected to increase to over $2B in 2016. Mobile games generate tremendous amounts of revenue from IAP - they’re pros at it. We’re seeing mobile app developers adopt these tactics to increase their IAP revenue.

Here are a few tips and tricks that we’ve learned from working with some of the most successful game developers in the world:

Identify your targets:

It’s important to target the IAP promotions to appropriate users. Sending blanket promotions  to all of your users could result in incredibly low conversion rates and may even reduce your revenue (by showing a would-be big spender a discount when they would have paid full price).

It sounds simple, but make sure that you’re promoting an item to a user that they’re likely to purchase. For example, you wouldn’t want to show a user a promotion for a subscription that they just renewed. Common segments targeted include:

  • Whales: These are people who already generate money in your app. Since you know their purchasing history, you can target them with specific IAPs they are likely to purchase. You also know that they are willing to pay full price so this is an opportunity to offer a low discount with the knowledge they are likely to purchase again.
  • Non-Spenders: These are people who haven’t spent any money in your app. In order to entice these users to spend, you will want to run IAP promotions with a steeper discount to encourage conversion.

Use creative messaging:

There are certain ways to craft your messages to get your users attention. When it comes to IAP promotions your goal is to present the message in a way in which your user wants to engage and ultimately make a purchase. Not only is the content of the message important but the timeliness is as well. Here are a few tips that will help you craft your messages in way that will likely entice your users to spend:

  • Seasonal/Holiday/Time: Tie the excitement of Christmas, Thanksgiving, 4th of July, etc. to your IAP promotion. The holiday’s are a great time to offer discounts and promotions tied to IAPs. In addition, think about specific timeframes in which your users are more likely to react to your message. For example, set up weekend deals and stress limited time or one-time occurrences to encourage your users to interact with your promotion.
  • ONLY Messaging: An old marketing trick still applies today and has proven to be successful with our customers. Try inserting the word ‘ONLY’ in the front of the sales price. For example, “ONLY $4.99” as opposed to just ‘$4.99”.
  • Button Messaging: It may seem redundant, but having large and highly visible call to action buttons in your message tend to improve performance. We’ve even seen certain colors perform better than others, specifically red and yellow buttons tend to garner higher click-through rates.
  • BONUS! Offer special/unique IAP items: Offer special and unique IAP items that do not exist in your current storefront (hidden IAPs). This can help boost sales and not cannibalize your standard priced IAP items. By adding hidden price points in the App Store or Google Play, you can offer targeted discounts exclusively to select segments of users.

Carefully choose specific places within your app to present IAPs:

Not only is it important what your message says and who it’s offered to but where in the app or game you are presenting them with the opportunity to make an IAP. You will have the highest probability of a user making a purchase if you present the IAP at places within your app where users are prone to buy. Here are a few examples of suggested places within your app to present an IAP promotion:

  • User hits a milestone in your app or is close to hitting a milestone: You want your user to stay in your app so this is an opportune time to send them an IAP promotion that will encourage them to continue actively using your app or playing your game. So if you’re making a game, a good milestone might be at the end of a level. Or it might be when a user fails to complete a level - maybe they DO need that extra life pack to make it through..
  • User exits the store without making a purchase: Your user entered the store and knows what you have to offer but left the store without making a purchase. This is a great time to offer them a discount on the items they viewed within your store.

Our customers have significantly increased their revenues by using the above tactics to create a clear in-app purchase strategy. Up next, in our in-app messaging series, we will talk about specific examples of in-app purchase campaigns.

  • Example Campaigns to Improve In-App Revenue
  • Using Rewards to Improve Loyalty
  • Plus more!

Interested in learning more about incorporating in-app purchases into your mobile marketing strategy? Check-out how to use our Virtual Goods Promotion tool.

In: Marketing

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