People Spend Way More On Purchases In Free Apps Than They Do Downloading Paid Apps

Candy CrushApp StoreCandy Crush, a free mobile app in which the author has made more in-app purchases than he would like to admit.

A new report from eMarketer shows that over the course of 2013, mobile users have become increasingly more likely to make purchase inside of free apps than to purchase an application that costs money to download.

According to the report, in-app purchases on free apps made up a whopping 98% of revenues for the Google Play store in November, and a similarly sizable 92% of revenues in Apple’s App Store.

Both numbers represent significant gains from what they were at the beginning of the year.

Emarketer freemiumeMarketerRevenues from free apps vs. paid apps.

According to app analytics firm Distimo, which provided the data to eMarketer, the increase in share of in-app purchases was a continuous trend throughout 2013. This signals that app developers are finding more success with the so-called “freemium” model, which offers users a base-level app gratis before offering to sell various updates, upgrades, and power-ups.

Distimo’s year-end report found that the freemium model was most dominant in mobile games, while people paid more money to download navigation and productivity applications.

The firm found that 90% of mobile gaming revenue came from in-app purchases in free apps, while 70% of revenues for productivity apps came when users paid to download them.

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