In-App Purchases Generate More Revenue Than Direct App Purchase

Distmo, an app analytics firm released a report of App revenues earned on iOS app store for direct app sales and in-app purchases. The data has been collected from over top 250 highest grossing applications in February 2013 that have been released since January 2012. They collected the number of downloads generated by the app, the revenue generated by the app for app sales and the revenue generated by the app through in-app content sales. In the data collected by Distmo they claim that the Average Revenue Per Download (ARPD) for all apps is approximately $0.99 and with paid apps having an average ARPD of $2.25 and free apps with an average ARPD of $0.93. Another significant noting is that almost 76% of the revenue generated on the app store is from in-app purchases only which is quite a surprise!

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Other interesting statistics

  • The average revenue per download (ARPD) of the top 250 apps released since January 2012 is $0.99 in the U.S. This number is significantly higher in Japan, where the average user spends more on apps, and the ARPD of the top 250 apps released since January 2012 is $3.12.
  • Among the top ten apps for February 2013, which were released since January 2012 in the U.S. for iPhone, the ARPD ranges from $0.37 to $7.04.
  • Of the three various business models, freemium apps generate the least amount of revenue per download with an average of $0.93 when looking at the top 250 apps in the Apple App Store in the U.S. Ninety-two freemium apps generated less than $0.99, which is the lowest price point for paid apps.
  • Paid apps without in-app purchases generate $2.25 in the Apple App Store for iPhone in the U.S. Paid apps with in-app purchases generate even more per download, indicating that users are not put off by the fact that they also have to pay for additional features within the app, in addition to the one-off fee they initially paid for their app.
  • The average revenue per download for paid apps is higher on iPad than on iPhone in the Apple App Store in the U.S.: $4.04 versus $2.25, respectively.
  • The average iPad download generates more revenue with in-app purchases than on iPhone. Freemium apps have an ARPD of $2.26 on iPad versus $0.93 on iPhone.
Revenue breakdown for iPhone
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Top 1o apps for revenue generatedi3
Total revenue division for iPhone
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Total revenue division for iPad
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Total revenue diving for iPhone division by country
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Source: Distimo