Everything You Need to Know About In App Purchases

Everything About In App Purchases

The monetization of mobile apps probably ranks as one of the most critical considerations when developing them. After all, marketers and developers want to generate revenue from their apps, right? Both the development and marketing costs must be covered, and a profit must also be made. What would you do if that were the case?

We have explored one such method in our guide to in-app subscriptions and there are undoubtedly many ways to skin a cat… to monetize an app. There, we discuss the benefits and challenges of in-app subscriptions, as well as how to manage them daily. The in-app purchase is another way to monetize apps. So now is the perfect time to investigate them.

What Are In-App Purchases?

An in-app purchase is a digital product or service offered within a mobile application. The purpose of these is to provide the app with extra functionality or value.

In-app purchases are often premium upgrades to the free version of the app that are offered as upsells. These features are usually optional for users, who can choose whether to access the basic features for free or to upgrade.

Whenever you make in-app purchases through the App Store (for iOS) or Play Store (for Android), the marketplace takes a cut of your revenues. A badge on the app store listing will also let users know if an app contains in-app purchases before they download it.

When Do You Need In App Purchases?

When something is used in the app, you have to charge for it through an in-app purchase. There are many types of premium memberships and content such as subscriptions, ebooks, games, and upgrades. Using in-app purchases is not necessary if your product is a physical one, such as t-shirts.

Using in-app purchases for an app with free and paid levels is required if you have a membership site. Premium content cannot be accessed in your app after purchasing on your website.

In App, Purchases are not counted as In App Purchases if people are charged to download your app. The app stores let you set up monthly fees of $2.99 or one-time fees of $.99 for people to use your app. You can get extra features for free by purchasing in-app purchases.

Benefits and challenges of in-app purchases

Let’s take a closer look at some of the major benefits of IAPs as well as their biggest challenges related to their implementation and management.

1. Flexible in Many Ways

As opposed to in-app advertising, developers can choose which in-game features to charge for and what amount to charge.

It might be decided that all players receive free weapons, but they need to purchase upgrades if they want to upgrade them. Some more exclusive and rare characters charge money, while three basic characters are free.

The cost of each item is also up to you. To see what works for similar games, we recommend checking out their pricing strategy.

2. A revenue stream that is stable

The main point remains the same: in-app purchases make mobile apps monetizable. With in-app purchases, you can ensure a steady revenue stream and experiment with new ideas and features for your app without worrying about finances. A new app launch is a great opportunity to earn money with in-app purchases. We should dig even deeper. However, that’s just scratching the surface.

3. An accessible freemium model

There is an increasing amount of hype surrounding the “Freemium” model. This feature has been adopted by the majority of businesses. Various premium and free services are available. As an example, let’s look at Grammarly.

The free version is useful for correcting mistakes quickly. However, there are no advanced features available in this version. A subscription fee is required for full access. Freemium is based on this model.

Users can be attracted and basic features can be provided to them through the service. A premium version is also available side-by-side. The premium version is thus available for purchase at any time.

4. Making payments easier

Whether it is making payments or getting deliveries quickly, users want fast services. It is possible to satisfy them properly with in-app purchases. There are three ways for a user to make a payment, as we have already discussed.

It is easy to make in-app purchases with these payment methods. Neither your credit card number nor UPI number is required. As a security measure, third-party wallets often ask for biometric information. It will not take longer than five minutes to complete any of these methods.

As a result, happier customers benefit from faster payments!

5. Extensive exposure

Your app gets preferential treatment from the app store when more and more users download it and leave reviews.

Apps that make the top-grossing lists or are rated as the best in a week or month are more likely to appear on these lists. The app can gain significant exposure through more incentives for users to download it and give it a try.

Engaging a large audience with your app will generate a great deal of revenue and traffic for your business.

Types of In app purchases

In-app purchases can be divided into three types. A publisher usually uses more than one type of IAP to generate revenue from an app.

Consumable purchases

A user pays money to obtain special features, privileges, and in-game currency for mobile games.

For users who prefer a quick boost rather than waiting for their currency or energy to recharge, this is the best option.

New stickers, emoticons, and themes are also available in a variety of messaging apps, as well as filters and features in apps that edit videos and photos.

Non-consumable purchase

Users have permanent access to non-consumable purchases once they purchase them. There is no expiration date or limit on how long it can be used. Premium features are often available with non-consumable purchases.


The concept of subscriptions has already been discussed, but in short, users get access to premium features, content, and functionality through a subscription. If the user does not pay the weekly, monthly, or annual membership fee, they are no longer able to access the website.

An auto-renewable subscription can be selected or a non-renewable subscription can be selected. Subscriptions with auto-renewal will renew automatically until the user cancels them. A non-renewable subscription, on the other hand, has an expiration date and must be renewed manually. In most cases, users are only granted limited access to certain privileges or content (such as in-game battle passes).

Wrapping Up

It might seem difficult to make in-app purchases at first. You can achieve your business’s goals if you have the right strategies. Incorporating this feature is as simple as creating an appropriate plan. An irrational offer will hurt your business if you do not know the market.

Your unique ideas for money-making apps should be turned into reality by an experienced app development company that offers a wide variety of in-app purchases.