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App monetization is a big deal.

After all, if you mess it up or don’t monetize properly, it could mean seeing the life of your dreams as a successful appreneur vanish into thin air.

IAPs (in app purchases) are one of the classiest ways to monetize your apps because they cater to the needs of your prime users without bothering everyone with unwanted ads that disrupt the user experience. Therefore, learning how to place IAPs within your app to optimize their conversion can make a huge difference in the financial stability of your app.

But figuring out where to start and exactly how to measure IAP A/B tests isn’t something a newbie appreneur would know right off the bat. It takes some industry know-how and backend knowledge of measuring in-app analytics, but adding this knowledge to your testing strategies will yield a far better ROI than simply relying on your gut to make changes for improving monetization.


When to Start IAP Placement Testing

The idea behind using IAPs to monetize your app rather than ads or sponsorships is to let consumers fall in love with the freemium version of your app to the point that it integrates itself into their daily lives and they want more.

Because you’ve built the loyalty and dedication on a freemium model, asking for a few dollars in order to enhance their experience won’t come across as a cheap, unnecessary demand on your part.

So, once you’ve built a significant amount of traffic to your app and have established regular usage amongst a loyal, dedicated user base, you can start monetizing them with small in-app purchases that optimize their experience.

Note: It’s important to remember that not every single user will opt for the purchases, but optimizing the ones who are willing to spend $1 to $5 here and there is crucial, especially considering only 5% to 10% of your dedicated user base are going to spend anything, and only that after they’ve had approximately 50 sessions of engaging screen time.

After all, think of the sheer numbers of people playing Candy Crush, and how many of those people that actually opt for the purchases. Not so many, right? But due to the volume of usage and dedication, they were still making $600,000+ per day last year because they have figured out how to optimize their IAPs correctly.

Which IAP Elements to A/B Test

Rather than haphazardly testing this and that in hopes of optimizing your IAP conversions, it’s better to map out a plan to optimize each stage of your monetization funnel before you start.

The first thing to pay attention to in mapping out your plan to A/B test your IAP placements is the general user cycle. Basically, you have to make sure you lead your users through the stages of acquisition, genuine engagement, retention via regular repeated sessions, and then finally monetizing the most dedicated retained users.

If too many users are dropping off before retention, that needs to be fixed first and foremost.

But once you’ve got a decent amount of dedicated users in place, your IAPs offering power ups, extra lives, more time, or general optimizations for non-gaming apps will be welcome by the ones dedicated to moving further.

Add an IAP at each stage of the app where you feel users would be willing to spend money: whether it’s to buy more time at the end of a level, the opportunity to add weapons to their arsenal before a battle, to buy more playing time when they run out of  it, or to invest in add-on features that enhance the app’s functionality.

At each stage you offer an IAP, you can test the following:

  •  Design – Just like color and layout can affect conversions on a website, it can do the same with IAP requests.
  •  Wording – This can make a huge psychological difference, especially on the final buttons. For example, does “Buy More Lives” or “Play Longer” get your users more excited?
  •  Offers – Experiment with which extensions, weapons, or IAP product combos you present to users at different stages. You’ll find newbies to your app probably have different preferences than veterans.
  •  Prices – If there’s no difference in the amount of buyers from charging $0.30 to charging $0.90, then of course you should go with $0.90. But once the number of buyers starts to fall due to price increase, you need to do a little experimenting and data tracking to figure out which price is your sweet spot for optimizing your bottom line.
  •  Frequency / Placement – You don’t want to miss out on potential purchases, but at the same time, throwing up an IAP placement every few minutes or making users navigate around one every time they start the app is going to drive them insane. Look at your usage analytics to figure out good timings to insert IAPs throughout a typical usage session.

How to Track the Analytics

So now that you know what to test, the big question is how to do it.

The easiest way to do it is to use an analytics tracking software like Flurry, which lets you see your users’ behavior patterns create trackable events so you can see which implementations of your IAP A/B tests work better than others.

flurry users

[caption: Flurry gives you detailed insights on the number of users and their interaction patterns with your app. (Image from Technology Advice)]

Within Flurry, you decide which types of events to track. For monetization, we suggest paying attention to things like when and why users close the app, when and how they move to a new level, what they do when they run out of in-app resources, or (if it’s a game) what they do when they get defeated in some way.

Many of our apps already have flurry integrated, if you’d like to give it a try, choose yours and start creating.

flurry apps

Your IAP Hacking Secrets

At the end of the day, even if making apps is your passion, the bottom line is still the bottom line, and if your passion doesn’t line your pockets, you’ll have to get another day job pretty quickly. So, let’s help each other out.

What are some of the best hacks you’ve found in monetizing your app with IAPs? Or are there any troubles you’re facing that you’re dying for help on? Let us know in the comments and we’ll be glad to help you out.

With literally millions of apps in the app store, you really need to make your app stand out. Sure, if you have a budget you can run a burst campaign or do one of the many forms of paid promotion. But, in addition to being a key part of app marketing, ASO can help your app generate more organic installs, making your business more sustainable.

Download it for free.


  • Pierro BC