Did you know iOS Sees a 30 Percent Increase in Average 'In-App Purchases' Price Between 2017 and 2020

Did you know iOS Sees a 30 Percent Increase in Average 'In-App Purchases' Price Between 2017 and 2020

Worldwide consumer spending in smartphone applications peaked at $111 billion last year, a year-over-year increase of 30%. Moreover, as per a study conducted by Sensor Tower, the median in-app purchase (IAP) price among the leading apps on App Store in the US has increased by as much as 50% since 2017.

It was unveiled that around 65% of IAPs in non-gaming apps were valued at under $10 in 2020. However, the successive tier ($10 to $49.99) has been solidifying its presence since 2017 by growing from 19% to 26% between 2017 and 2020. Applications that fall under the Photo & Video and Health & Fitness categories had a major part to play in this.

It’s interesting to note that US consumers have expressed interest in subscription-based models. In 2020 alone, they spent a whopping $10.3 billion in the leading 100 subscription apps. Add to the fact that over half (53%) of the applications (assessed for the study in question) boasting IAPs now offer subscriptions.

By 2020, over half of the top Photo & Video (54%), Food & Drink (47%), Weather (60%), and Health & Fitness (73%) applications were offering subscriptions.

With the restaurants and gyms shutting down all over the world in the wake of COVID-19, it was only fitting for consumers to resort to smartphone applications and spend their money there.

The average IAPs price in the leading US iOS games increased by 25% ($3.99 to $4.99) in a span of one year (2019 - 2020). During the same period, the average subscription price among these apps also increased from $5.99 to $6.99.

With the pandemic and the resulting lockdown restrictions leaving people with immense spare time, the rise in prominence of gaming apps was inevitable. So, it goes without saying that consumer spending on mobile games skyrocketed in 2020 with the US securing the top spot as far as revenue is concerned.

This increase in interest may have prompted certain publishers to increase the price of IAPs. Despite that, most purchases in games stayed under $10. In 2020, 81% of purchases were priced under $10.

Even though most games haven’t embraced a subscription model yet, there has been an impressive development in this regard. Between 2017 and 2020, the percentage of top US App Store gaming applications offering subscriptions has increased from 11% to 18%.

Sensor Tower also estimated a while back that worldwide consumer spending on Apple’s App Store will amount to $185 billion yearly in 2025. Moreover, app developers have done a fairly good job of adjusting in accordance with the changing user behavior in the wake of the COVID-19 pandemic. However, it’s interesting to note that even the marketplaces have chimed in now.

It was reported not too long ago that Apple had started cracking down on IPAs with over-the-top prices. This clearly indicates that the Tech Giant would be closely monitoring the suitability of IAP pricing with respect to the value offered.

It will be interesting to see the progress of the smartphone industry in the coming years.



 

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