Adapty on how publishers can benefit from in-app purchases and subscriptions

Apple’s push against third-party tracking has been a seismic event that has sent ripples through the global ad market, prompting an outcry from advertisers and social media platforms, in particular Facebook and Snapchat.

One of the things the clampdown has highlighted is the importance of building an effective in-app purchase and subscription ecosystem. A leader in that field is Adapty, a pioneering company that provides user-friendly open-source SDKs for the most popular stacks: Swift, Kotlin, Flutter, React Native, and Unity. Currently, more than 2500 apps are using Adapty.io, with the company processing tens of millions of subscription events every month.

We sat down Kirill Potekhin, Adapty’s co-founder and CTO to talk about how publishers can benefit from in-app subscriptions and purchases.

Why choose in-app subscriptions? How does it differ from a kind of browser-driven subscription?

In-app subscriptions are usually the only efficient way for developers to monetise a mobile app if one is designed for user acquisition. It doesn’t mean they work differently compared to subscriptions on the web, but for mobile-first projects, markets, and audiences they are vital. They must be fast, handy, straightforward, personalised, and synchronised across all the platforms involved.

And how can publishers benefit from it?

It is completely up to publishers when it comes to choosing the platform to process subscriptions. Everything has its pros and cons, and, in the meantime, those can be relative. For example, you will certainly have a higher conversion rate using in-app subscriptions compared to browser-driven, whether it’s a mobile or desktop version, which, for starters, doesn’t have such an important retention improvement element for wise marketers as push notifications. Nevertheless, you should be aware that both Apple and Google strictly forbid selling subscriptions in your apps using any external provider for payments. Developers want it badly to avoid a hefty 15-30% fee but so far to no avail. There are some exceptions, the most notable are the ones when you sell physical goods like Amazon or provide offline services like Uber.

Cross-platform projects can use their website as a point of subscription and, probably, pay lower fees but they won’t be able to benefit from the scalability of app audiences. You are not allowed to ask customers in the app to pay on your website or elsewhere. Moreover, if the customer installed the app first, you can’t even send an email telling them about other payment options. So, it makes more sense to activate subscriptions in mobile apps and just synchronise subscribers’ data across different platforms – websites, desktop apps, etc. In most scenarios, if done right, a project gets higher revenue even with 15-30% deducted by Apple/Google, the room for scalability, and no headache when launching on other platforms.

So, Adapty facilitates the integration of in-app subscriptions into the apps, but you do not process the payments?

Yes, all users’ payment data is still managed only by Apple and Google themselves. So, users make purchases, tech giants process their payments and handle developers’ balances, teams come up with ideas for premium access, and Adapty automatically converts those ideas into the right backend-you-don’t-deal-with code, which sends particular premium purchases from users to Apple/Google.

How has Apple’s clampdown on third-party tracking affected in-app purchases and subscriptions?

The IDFA changes made everything much more complicated about in-app ads. It got harder to buy them because you simply don’t have enough information regarding where the users are coming from, which complicates the evaluation of the effectiveness of advertising campaigns. Developers need transparency, a revenue roadmap, and flexibility for financial growth. That’s what our A/B testing functionality provides at scale without the need to write any code or release app updates.

Looking at the subscriptions market more broadly we saw a big bump during Covid, then it slowed a little, but still seems to be strong. How do you see things right now and why is it important to have direct reader/audience revenue streams in place?

According to our recent analysis, the average annual subscription fee in apps has grown by 36.5 percent year-on-year. Certainly, this year we don’t see such intensity. The overall spendings on mobile subscriptions now are a few percent less compared to last year. However, you are right, the subscription market remains rather strong. When it gets 40% bigger during extraordinary circumstances and then loses only 5% on the way back to normal, this is remarkable growth, strength, and scalability, where statistics without context don’t matter at all. In fact, that’s not a decrease but just a slight correlation of an increase.

As for the importance of direct revenue from the audience, in the case of mobile in-app subscriptions, that’s the best way to grow. I don’t mean the amount of money, which, of course, is another strength here, but the flexibility. It is your custom relationship with users, readers, and clients based on the quality you provide. So, with new ideas and enough analytics on what’s going on with your subscriptions – weaknesses, strengths, prospectives – there is always room for global or partial scalability through subscriptions and purchases customization.

Why do so many developers consider monetisation via in-app ads in the first place?

Because it’s been a pretty simple thing to do. How it affects the user experience and loyalty is another question, but technically, that’s something anyone can do on the go. Building your own in-app purchases ecosystem in-house from scratch takes months of work and a team with huge experience in fintech development as the tiniest error sometimes can cost a lot. Adapty is here to change the rules of the game. You don’t need to be a mobile developer to implement in-app purchases into your application. We provide professional but in a meantime intuitive, user-friendly open-source SDKs for the most popular stacks.

Literally, all you have to do is just enter some details about your app and premium offers – as many as you want. Within a single platform, you get complete web infrastructure with purchase verification, subscription analytics, remote paywall configuration, A/B tests, third-party integrations, and other features.