In-App Purchase Revenue
Learn how to forecast In-App Purchase revenue with your financial model made with Sturppy.
To configure the revenue from your in-app purchase, go to
/Revenues/In-App Purchases, here you will be able to configure everything you need in just a single page.
As you can see the in-app purchase inputs are very similar to Subscriptions and E-Commerce, let's see how to configure them correctly.
The inputs are divided in two parts: transactions and products
Here you can configure how your users will convert into paying customers.
This is the percentage of active users that each month make a purchase in the app. You can learn more about conversion rates, here
Transactions per user per month
This is the number of purchases that a single paying customer will do in one month. This is needed because with mobile apps, not all the users buy something in-app, but the ones that do, usually buy more than once (whales ). This is an average.
This is any cost that you have to pay when someone makes an in-app purchase. This is usually the fee of Google or Apple.
Estimating these inputs can be difficult for a fist time founder or someone that has never dealt with mobile apps. We highly suggest you to make so Google searches around your specific app (for instance mobile games).
Coming up with a conversion rate for in-app purchases can be difficult, so we suggest you Google it. From what we have found, the average conversion rate for a free app, is around 2-5%.
The products are all the digital items that your users can buy from your app.
In this table, enter all the items that you are selling:
This is the name of the item that the customer will see.
This is the amount that the customer will be charged for.
The percentage of customers that choose this item (also called distribution). Usually, the items that are more expensive will have less customers (so a smaller share percentage), than cheaper items.
At the end, you will have the projections of your transactions and of your revenue. You can also check out the distribution of these numbers by their traffic source.
If you charge your customers each month, like a monthly subscription, then you should use Subscription revenue instead of in-app purchases.