- 20 Apr 2023
- 2 Minutes to read
In-App Purchases (IAP)
- Updated on 20 Apr 2023
- 2 Minutes to read
What are In-App Purchases (IAP)?
In-App Purchases (IAP) are a method of app monetization where something can be bought within a mobile application. This is any fee paid to the app developer in addition to the cost of downloading an app. There are different types of In-App Purchases available within the app, and this often varies depending on the kind of mobile app. For example, in gaming apps, users can purchase additional lives, characters, or special abilities for a small additional fee. In Productivity apps, however, users can unlock certain features by making In-App Purchases.
What are the different kinds of In-App Purchases (IAP) I can implement within my app?
There are a few different types of IAPs that mobile developers can implement within the mobile app:
Consumable: This is the most common type of IAP, and is often used in gaming apps. The user pays for a specific item and uses it, after which this item is depleted from the user’s account and a new purchase is made.
Non-Consumable: With this kind of IAP, certain mobile app features and products can be purchased once, but can be used repeatedly without depleting. An example for this is access to premium features or a new photo filter available for the user account.
Subscriptions: This type of IAP provides users with continued access to app features, products or services. The user is charged at regular intervals (weekly / monthy / annually) until they choose to cancel their subscription. There are, however, some non-renewing subscriptions as well, which are typically for a specific season or a limited period of time.
What are some important In-App Purchase (IAP) metrics?
Some In-App Purchase (IAP) metrics that can give you valuable insights into how your app is performing are:
- Customer Lifetime Value (LTV) for e.g. X-day IAP LTV/user
- Average Revenue per Paying User (ARPU)
- Daily Active Users (DAU)
How can I track In-App Purchases (IAP) with Tenjin?
At Tenjin, you can track your In-App Purchase revenue by sending the receipt data through the SDK (or S2S). It’s very simple to integrate this event, and you can find the documentation with instructions for this here. With Tenjin, you can also track fraudulent purchases separately in your app, and this data is available on the Tenjin dashboard.
IAP Revenue per Daily Active Users is the average amount of IAP revenue per DAU. At Tenjin, we calculate this using the following formula:
IAP Revenue / Number of users