Corporate Eye

In-App Mobile Purchase Revenue Predicted to Jump 477% by 2015

Mobile applications are one of the hottest marketing opportunities for brands today, but companies are still trying to figure out how to best use mobile applications to drive revenue.

According to a study by IHS Screen Digest, in-app purchases are the way to go. Revenues from in-app mobile purchases are going to jump by over 477% from $970 million in 2011 to $5.6 billion in 2015. In other words, if you’re not already investigating ways to offer your brand products and services through in-app mobile purchases, you need to bump it up the priority list.

eMarketer paired this research data with information from an ABI Research study, which found revenues from mobile applications (including in-app purchases, in-app advertising, subscriptions, and pay-per-downloads) reached $8.5 billion in 2011. The study reports that number is expected to skyrocket by over 440% to $46 billion in 2016. Putting the numbers from both studies together, eMarketer reports that in 2011, in-app purchases made up 39% of total mobile app revenues. By 2015, that percentage will increase significantly to 64% of total mobile app revenues coming from in-app purchases.

Taking it a step further, eMarketer notes that 44% of mobile app users don’t make in-app purchases until at least the tenth time they’ve used the app. This data comes from a separate study by Localytics. 33% make an in-app purchase between the second and ninth time they use the app, and just 22% make an in-app purchase the first time they use an app.

These statistics do more than just raise a big red flag if you’re not already planning ways to offer your products and services through mobile in-app purchases. Within the next few years, mobile app users will be very willing to make in-app purchases. The trick for marketers is to come up with great offers that are available to the right audiences.

Even more tricky is trying to find ways to get mobile app users to make purchases earlier rather than waiting until their tenth use or later. Power mobile app users have demonstrated they’re comfortable making faster in-app purchase decisions, but convincing the rest of the mobile app user population to reach the same comfort level will take some time and effort.

Now is the time to get started.

What do you think about the future of mobile in-app purchases? Leave a comment and share your thoughts.

Image: jhaymesiviphotography

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Susan Gunelius is the author of 10 marketing, social media, branding, copywriting, and technology books, and she is President & CEO of KeySplash Creative, Inc., a marketing communications company. She also owns Women on Business, an award-wining blog for business women. She is a featured columnist for Entrepreneur.com and Forbes.com, and her marketing-related articles have appeared on websites such as MSNBC.com, BusinessWeek.com, TodayShow.com, and more. She has over 20 years of experience in the marketing field having spent the first decade of her career directing marketing programs for some of the largest companies in the world, including divisions of AT&T and HSBC. Today, her clients include large and small companies around the world and household brands like Citigroup, Cox Communications, Intuit, and more. Susan is frequently interviewed about marketing and branding by television, radio, print, and online media organizations, and she speaks about these topics at events around the world. You can connect with her on Twitter, Facebook, LinkedIn, or Google+.
 
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