Flurry: Consumable goods dominate in-game purchases on iOS and Android

Consumable goods--defined as "something that is depleted when used," e.g. grenades in war games or fertilizer in farming simulator titles--represent more than two-thirds of all in-app purchases across freemium iOS and Android games according to new data issued by mobile app analytics provider Flurry. After studying 57 million purchase transactions across a set of freemium iOS and Android games averaging more than 2 million daily active users, Flurry reports that consumable goods account for 68 percent of all in-game purchases, more than double the number of durable item purchases (like armor in role-playing games) at 30 percent. Personalization items--purely decorative purchases that, while durable, do not add any actual gameplay benefit--make up the remaining 2 percent.

Flurry notes that the most popular in-app purchase (consumable or otherwise) is in-game currency, which can be spent to further gameplay in a number of different ways, often enabling players to advance through the experience more quickly. Games that integrate consumable items typically monetize very well, promising developers the best ROI on game development resources. However, Flurry adds that not all games are optimized for virtual currencies or consumables of any kind--for example, city-building titles, where progression is measured by the evolution of a metropolis made up of individual buildings, benefit from an emphasis on durable items.

"Buying increasingly better performing durable items gives players a sense of progress, which can be important for engagement," writes Flurry GM of games Jeferson Valadares on the company's blog. "Additionally, offering bigger, better durable items allows users to set goals, or even change their gameplay strategy, in order to save up for, and make, bigger purchases."

Because personalization items exert no direct impact on gameplay, players purchase them infrequently, Flurry adds. "Consumers don't tend to decorate, and then re-decorate, in most games," Valadares writes. "For example, think about how often you change your Facebook or LinkedIn profile picture.  The rule should be that if a game is not largely about personalization, then add just enough of these items to allow players to create their own unique gameplay look and feel."

Freemium games--i.e., titles that are free to download but offer premium in-app transactions--now generate 65 percent of gaming revenues in Apple's (NASDAQ:AAPL) App Store, up from just 39 percent as recently as January of this year, Flurry reported earlier this summer. Given that games typically represent more than 75 percent of all top 100 grossing applications in the App Store, that means the freemium concept is now the dominant business strategy across the mobile software ecosystem.

Roughly 3.5 million consumers are now spending money within freemium iOS and Android games, Flurry adds. The average amount spent per transaction: $14, with transactions eclipsing the $20 benchmark generating 51 percent of in-app mobile game revenues. More than 5 percent of all in-app purchases exceed $50, rivaling the prices paid at retail for popular console and PC games.

For more:
- read this Flurry Blog entry

Related articles:
Flurry: Freemium titles yield two-thirds of App Store gaming revenues
Nielsen: iOS users spend twice as much time playing mobile games
Flurry: iOS, Android games rake in $800M in 2010
PopCap: One third of adults play mobile games each month
Forecast: Mobile game ad spend to reach $900 million by 2015
Gartner: Mobile game revenues to top $5.6 billion this year

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