Localytics: Loyal users drive 25% more in-app purchases

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Building relationships with mobile application users and fostering long-term usage behaviors are critical components to driving in-app purchases reports mobile app analytics firm Localytics, noting that the average consumer does not complete an in-app transaction until 12 days after first launching the app in question.

Forty-four percent of in-app purchasers surveyed by Localytics completed their first buy only after interacting with the app at least 10 times. Moreover, consumers who interact with the app on a regular basis before making in-app purchases are more valuable over the long run, making 25 percent more in-app purchases over their lifetime as a customer. Localytics adds that first-session purchasers make an average of 2.8 purchases in a given app during their user lifetime, compared with 3.5 transactions for other purchasers.

"While moving users towards a purchase as quickly as possible is often considered the primary objective, this data suggests that turning purchasers into loyal, repeat users should be a top priority," Localytics states on its blog. "While a first-session purchase is an excellent result, our data found that only 16 percent of users who make a purchase their first app session will go on to engage with that app 10 or more times, compared with 26 percent of overall app users. Thus, it is imperative that app developers and marketers pay special attention to their analytics solution's loyalty features."

Virtual goods purchased within mobile applications will generate revenues of $1 billion in 2012, quintupling in size over 2011 totals, according to a forecast issued earlier this month by market intelligence firm Strategy Analytics. Despite increasing developer and consumer interest in virtual goods, only Apple (NASDAQ:AAPL) and Google (NASDAQ:GOOG) have taken significant steps to capitalize on the trend, leveraging in-app merchandizing capabilities to fuel the continued growth of their respective mobile platforms. Strategy Analytics warns that competitors must move quickly into the virtual goods segment: At the current pace, Apple will control roughly 53 percent of paid download revenue marketshare in 2013, followed by Android at about 22 percent.

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