Who pays for mobile apps?

Who pays for mobile apps?OK, so this story has a primarily American slant but it's still interesting for us in Blighty as the information itself comes from London.

Basically, about two thirds of people who use apps have spent money on one on at least one occasion - on average, about £10 a month in total. Yet the closer you look, the more interesting things get.

The research comes courtesy of ABI Research:

“The median amount among the consumers who spend money on apps is much lower than the average, just $7.50 per month. This reflects the disproportionate role of big spenders as a revenue source. The highest-spending 3% of all app users account for nearly 20% of the total spend, while over 70% spends either nothing or very little.”

It adds up to a simple point: the contribution of the big-spending few makes the collective spend of the mobile-using public seem a lot higher than it is, and that the "average user" isn't just more of an untapped resource than it first seems, but is also a far larger group.

The numbers also show just where the spending lies, with the most successful traditionally having been those that are business focused and, can therefore, have a cost justified. After all, organisations are far more likely to pay than individuals. The other spending comes with games on iOS, where people pay for in-app purchases.

Free games are the most popular, but if developers want some advice on how to convert freegans to full payers, here it is:

"First, don’t get obsessed by mobile and apps, but remember also the web. Most of the successful app concepts either support, or are supported by, a web component.

"Second, see your product through a long-term lens, asking yourself what could convince your customers to still engage with the app in two years’ time. Evernote, for example, has excelled at both.

"It has skillfully combined the web and the mobile, and at the same time it has also managed to become a habit for many of its users. It demonstrates that the longer its customers stick around with a free version of an app, the likelier they’re going to convert to its premium version."

Via BGR

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17 comments

SpeedyG  May. 16, 2012 at 19:12

I can't remember spending any money for my old Hero but I've spent £40+ on apps for WP7, £30 of which would be on games I think.

Go figure.

Treab  May. 16, 2012 at 19:26

Tbf the hero did struggle to play angry birds...

bigmo7  May. 16, 2012 at 19:58

I never used to spend money on Android, I'd buy apps on my iPod all the time though. After getting my Galaxy S and GS2 I've spent a lot more on Android and don't use my iPod at all. I think it's just that apps are more refined and better quality on Android and most apps are now on Android and iOS. Win win!

Pondlife  May. 16, 2012 at 20:49

£10/month?
Just don't see that much out there to spend that much on. £35 worth of itunes credit on ios in about 27 months and most of that was music. Less on android in about 16 months.
be very hard pushed to go on there and find the £200+ worth of apps that I should've bought to get near that spend.

alanweird  May. 17, 2012 at 00:15

I'd spend on android if google weren't complete **** about what payments they'll accept.

Effectively I can't pay for anything as I have a maestro. Apple accepted it! Apple love your money. So google... why do you hate my money?

Pondlife  May. 17, 2012 at 00:26

I think they would be well advised to start doing a gift card system like Apples to add credit to your account.

AhmadCentral  May. 17, 2012 at 00:33

I Liked it when you could pay from your mobile phone balance. What ever happened to that system. It came out of your payg credit or was added to your next bill. Simple and easy. Now its all credit card based.

SpeedyG  May. 17, 2012 at 00:36

Credit cards must be more secure level of payment and protection.

Not everyone has huge pre-pay balance for some apps or would like to see extra payment on their bill for it.

JanSt / MOD  May. 17, 2012 at 07:02

I Liked it when you could pay from your mobile phone balance. What ever happened to that system. It came out of your payg credit or was added to your next bill. Simple and easy. Now its all credit card based.
Here in Ireland the Android PlayStore lets you pay via CC or your Phone Bill.

But I agree with pondlife: Apple's vouchers are clever.

CTPAHHIK  May. 17, 2012 at 08:05

There is no PayPal option? Google Checkout supports it. I'm assuming Google Play goes through Google Wallet and there is no PayPal?

CTPAHHIK  May. 17, 2012 at 08:17

I think I would fall in between "spends either nothing or very little". I have around 25 purchases in life time, most of which are promotions. I can only thing of Titanium Backup and Cut the Rope from the things that I bought right away. GTA III was accidental buy.

Pondlife  May. 17, 2012 at 10:27

Titanium is just so useful.
Accidental?

Yeah Jan was reading earlier that most networks work that way with google play in the US too, I bet there's a fair few parents over here glad it doesn't work that way here.
Guessing that one reason Google aren't so keen on that method is that the networks then want a cut.

AhmadCentral  May. 17, 2012 at 12:16

Titanium is just so useful.
Accidental?

Yeah Jan was reading earlier that most networks work that way with google play in the US too, I bet there's a fair few parents over here glad it doesn't work that way here.
Guessing that one reason Google aren't so keen on that method is that the networks then want a cut.


Excellent point. I guess parents could put a block on it. I don't mind using credit cards and i do so. Bought about £20 worth of apps in the last year and a half. i guess i was just always used to it being added to your bill/credit.


Totally off topic, One thing that bugs me is when parents go on about their kid racking up a huge phone bill when the whole thing could have been prevented if you'd capped the account first and told your kid not to use more than supplied otherwise they have to pay for it...

Pondlife  May. 17, 2012 at 12:46

Well not all accounts can be capped even now I think, but I think payasyougo makes more sense for kids tbh

CTPAHHIK  May. 17, 2012 at 12:47

GiffGaff for Kids - buy goodie bag, no top ups, no apps. ;)

Pondlife  May. 17, 2012 at 13:06

Wish there was a poll function on here

AhmadCentral  May. 17, 2012 at 13:27

Yep, Pay as you go is the best option. But i know people who take out contracts for their 12 year olds and they end up spending extra pretty much every month...

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