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BizReport : Mobile Marketing : May 17, 2012

Mobile users aren't parting with cash for apps

Smartphone users love apps and the number per device increased signifcantly last year, found Nielsen. However, according to new findings from ABI Research, most people aren't prepared to part with cash for an app.

by Helen Leggatt

ABI Research logo.jpgOver 70% of smartphone users spend little to nothing on mobile apps they download. While those who do pay to play spend, on average, $14 each month, when it comes to across the board users that figure drops to just $7.50.

ABI's findings illustrate the disproportionate role of big spenders as a source of revenue for app developers. The highest-spending 3% of all mobile app users account for nearly 20% of the total spend.

So what can developers do to increase the conversion of free to paying users? According to ABI Research senior analyst Aapo Markkanen, developers should remember to keep the web in the mix. "Most of the successful app concepts either support, or are supported by, a web component," he says in a recent press release.

In addition, an app needs to drive long-term use. Successful app developers, such as Evernote, have demonstrated that the longer someone uses a free version of an app the more likely they are to convert to a paying customer. "See your product through a long-term lens, asking yourself what could convince your customers to still engage with the app in two years' time," advises Markkanen.

The average number of mobile apps per smartphone in 2011 was 41, a rise of 28% on 2010, according to a new report from Nielsen. However, the amount of time being spent using apps has remained almost the same - 39 minutes each day today compared to 37 minutes during 2011.

Apps are encroaching on the time users spend on the mobile web. Nielsen's report, "State of the Appnation - A Year of Change and Growth in U.S. Smartphones", found that smartphone users are using apps 10% more than the mobile web this year compared with last.

Tags: app development, mobile apps, mobile marketing, mobile trends, smartphone

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