Revenue from mobile in-game purchases to double by 2016

iphone-appsMobile app developers are looking more and more into the idea of generating revenue from in-game purchases, with income from such purchases expected to more than double in the next four years.

The folks over at GigOM took a close look at the latest findings made by Juniper Research, who said that while mobile in-game purchases totaled $2.1 billion last year, this is expected to hit $4.8 billion by 2016.

This can be put down to a number of factors. Firstly, mobile devices such as smartphones and tablets will continue to find their way into the hands of more and more consumers in the coming years, further increasing the customer base for app developers.

Secondly, many developers are coming to the conclusion that the best way to generate revenue from their work isn’t to put a price tag on the app, but to give it away for nothing and then make sales from within the game.

People are understandably cautious about spending money on an app without ever having tried it – but give it away for free and there’s a good chance that if they like it, they’ll be happy to pay for extra content.

In a recent interview given to Reuters, Craig Palli of marketing company Fiksu said that last year in particular the tide was beginning to turn for developers who were starting to realize the value of offering apps for free and adding opportunities for in-app purchases.

As GigaOM points out, the challenge for developers is to present the offer of in-app purchases in a way that doesn’t put the user off playing the game – constant messages prompting the user to upgrade or buy extra content are certain to become annoying after a while.

The world of mobile apps is still in its infancy, but it seems the business model is starting to establish itself. Expect to see more free apps coming your way in the coming years, together with in-game messages gently prompting you to part with your money.