Amanda Maricle is the Product Owner at Nami ML. She has an extensive background in app development and most recently product managed the Connect mobile app platform at HomeSpotter.
If you are developing a new iOS app, you may have questions about monetization. Are you required to always use Apple In-App Purchase? Can you use PayPal or Apple Pay instead? It all comes down to what products or services you are providing in your app. Here are our Apple In-App Payment Guidelines.
What's Apple's In-App Purchase (IAP)?
Apple's in-app purchase (IAP) is a system that allows users to buy additional content, subscriptions, or features within an application on iOS devices. Developers can offer various types of in-app purchases, such as consumable items, non-consumable items, and subscriptions, all managed and billed through Apple's platform to ensure secure and standardized transactions.
Based on App Store Review Guidelines, updated October 24, 2022. All guidelines are subject to App Store review and approval.
Which Types of Apps Should Implement IAPs?
Implementing in-app payments correctly is crucial for compliance with Apple's policies. Here's a detailed overview of which types of apps should use in-app payments and which shouldn't:
Must use Apple In-App Purchase
Digital Content
Digital Subscriptions
Gaming currency, levels, loot boxes
Tip Jar
Digital Gift cards
NFTs
In-app advertising
Can use Traditional Payments
Physical Products
Non-Profit Donations (if approved)
Special Guidelines
Person-to-person services
Advertising management
“Reader” apps
Types of In-App Purchases
Apple categorizes in-app purchases into four main types:
Consumables
Items that can be purchased and used within the app, but cannot be reused or transferred between devices. Examples include virtual currencies, extra lives, and temporary power-ups.
Non-Consumables
Items that are purchased once and do not expire or deplete. These can be used indefinitely and include features like ad removal, additional content, or a one-time upgrade to a premium version.
Auto-Renewable Subscriptions
These are subscriptions that automatically renew after a specified period unless the user chooses to cancel. Common examples include streaming services, news publications, and cloud storage plans.
Non-Renewable Subscriptions
Subscriptions that provide access to content or services for a limited time and do not automatically renew. Examples include seasonal sports packages and time-limited access to educational content.
11 Examples of Apps with Different Monetization Options
1. Selling Physical Products
If you are selling physical goods in your app, Apple In-App payment guidelines do not require you to use Apple In-App Purchase.
For physical goods, you can use credit cards, Apple Pay, PayPal, Stripe, or many other payment solutions to capture payment information. You will not be subject to App Store fees for the payments. But you may be subject to fees for the other payment platforms.
Examples include clothing, sports equipment, home decor, custom art, food delivery, pet supplies, groceries, and more. Physical gift cards are also captured in this category, as long as the gift card is mailed to the customer.
2. Non-Profit Donations
Eligible non-profits may apply for approval from Apple to solicit donations inside their mobile app. These donations can be provided through Apple Pay instead of Apple In-App Purchase and aren’t subject to fees or commissions.
Many mobile apps fall into this category. If you have digital content that is unlocked in your app via a one-time or subscription purchase, you must use Apple In-App Purchase.
If you have digital content that is unlocked in your app via a one-time or subscription purchase, you must use Apple In-App Purchase.
Examples of digital content include podcast or TV episodes, articles, recipes, removal of ads, customized app icons, and premium feature sets.
“Reader” apps, such as apps that provide news, movies, or music, have some special limitations. See below.
4. Game levels, currency, or loot boxes
Mobile games are a popular category of app that often utilize in-app purchase. All in-game purchases must use Apple In-App Purchase. You cannot use PayPal, Stripe, or credit card payments.
In a 2021 lawsuit Epic, the maker of popular mobile game Fortnite, fought against these Apple restrictions. Learn about the outcome.
5. Apple In-App Payment Guidelines: “Tip Jar”
A “Tip Jar” is a popular way for app or content creators to collect small amounts of voluntary revenue from their customers. If collecting inside the app, you must use Apple In-App Purchase for your “tips” and will be subject to Apple fees.
6. Digital Gift cards
Gift cards, certificates, vouchers, and coupons are all units that can be redeemed for digital goods or services. If you are selling them inside your app, you must use Apple In-App Purchase.
7. NFTs
Minting, listing, and transferring NFTs is allowed inside your mobile app, but you must use Apple In-App Purchase for payments related to NFT services. Purchasing, owning, or viewing an NFT cannot unlock in-app functionality.
8. In-app Advertising
If a user pays for their in-app content to be seen by more users in your app, this qualifies as in-app advertising and you must use Apple for your payment platform.
A common example would be boosting a post in a social media profile.
9. Advertising Management
If a user has ads running outside your app, and is managing or paying for them inside your app, you are not required to use Apple In-App Purchase.
Examples include managing TV ads, creating new search ads, and starting a billboard ad campaign.
10. Apple In-App Payment Guidelines around Person-to-Person Services
Person-to-person services involve you selling your time to 1 customer. The customer may not get an artifact in return, but you will have spent time delivering them some value. Person-to-person services are not required to use Apple In-App Purchase and can use other methods.
Examples include massages, physical trainers, nutritionists, tutoring, and real estate tours.
11. “Reader” Apps
Reader apps are defined as apps that allow users to access previously purchased content or content subscriptions, specifically magazines, newspapers, books, audio, music, and video.
If approved, your Reader app can have a special entitlement that allows users to manage their account and billing outside the app through a special link. When this link is in use, you cannot use Apple In-App Purchase and must only allow purchase of your services through your website.
If you do want to permit purchase inside the app, you must use Apple In-App Purchase and can’t use the External Link Account Entitlement.
A common example of this includes streaming video apps like Netflix. Many don’t allow you to subscribe inside the mobile app and only allow you to login to your existing account to access content.
Summary of Apple In-App Payment Guidelines
Understanding which payment methods you need to use in your app is the first step to understanding app monetization.
If you need to use Apple In-App Purchase, Nami can help. With just a few lines of code, Nami handles payments for Apple and Google and allows you to focus on the app experience instead of the ins and outs of subscription management. Learn more.
Paywall designs and best practices are always evolving. Here are 3 paywall trends we’re keeping an eye on in 2023.
Honest Paywalls
The Honest Paywall was popularized by Blinkist as a way to improve conversion to paid plans. This style of paywall utilizes a timeline to help users understand when they will get charged. You can use an honest paywall to help answer questions about the trial. In addition, honest paywalls help buyers feel more comfortable with starting a trial.
The typical honest paywall has 3 timeline events: start of trial, reminder event, and end of trial.
The “Start of Trial” or “Today” event is a way to highlight the features the user is unlocking with their trial right now. The “Reminder” event refers either to the system reminder emails sent by Apple and Google or the emails and/or SMS reminders your system sends to users. Finally, the “End of Trial” event tells the user when they will be charged unless they cancel.
A free trial toggle is a toggle that activates a trial offer on the product. A paywall with a free trial toggle typically has 1 product, such as an annual product, and defaults to no free trial. But with a click, the user can activate a trial.
In our Paywall Placement Best Practices blog post, we discussed the importance of a focused paywall that launches right after onboarding. This paywall typically only has 1 product and might utilize a free trial timeline.
However, this 1 product might not appeal to all users, especially if they aren’t ready to commit to an annual purchase. To help highlight other purchasing options, paywalls are adding a ‘View all plans’ button that opens a second page or drawer with additional subscription options.
Your mobile app paywall is your biggest driver of revenue. Optimizing your flow to show different paywalls at strategic locations can increase revenue and conversions. Here are our best practices for paywall placement inside your app.
This blog post is part of our Paywall Best Practices series. Read our tips on Designand Products.
Show a Paywall right after App Launch
The first few moments a new user uses your mobile app are very important. Many users churn in these few moments if they don’t understand the app or don’t see the benefits. First optimizing the first launch flow to teach the user about the product is important. Then showing them an initial “indirect intent” paywall can help reinforce the features and show them pricing.
Indirect intent paywalls are shown without the user expecting or intending to launch them. Don’t be surprised if this type of paywall has low conversion. Users often need to see the paywall multiple times before committing to a purchase.
Paywall Placement Best Practices recommend not requiring a purchase to continue into the app. Very few business models really require this. And often users will have high churn rates if they download a free app but need to purchase a subscription in order to actually enter the app. Make sure to clearly show a ‘Later’ or close ❌ button on this paywall so the user can enter the app and start exploring.
Launch a Paywall Right After Onboarding
Many apps include an onboarding sequence that gathers key information about the user and sets up their account. This sequence if done correctly can help make users more engaged and make the product easy to use after setup. The time users spend in the flow also helps your product become more sticky, as you take advantage of the sunk cost fallacy. Users who spend time during onboarding are more likely to continue using the app because they’ve already spent time getting setup.
The Sunk Cost Fallacy describes our tendency to follow through on an endeavor if we have already invested time, effort, or money into it, whether or not the current costs outweigh the benefits.
Take advantage of this momentum by showing a paywall right at the end of the sequence. This paywall should reiterate the features and benefits you showed during onboarding. This type of paywall often includes only 1 annual product, but you should test to find out what converts the best.
Paywall Placement Best Practices: Gate App Content behind Direct Intent Paywalls
“Direct Intent” paywalls are paywalls that users come across intentionally, while trying to gain access to the content behind them.
These paywalls should focus on the feature the user was trying to access. Don’t reuse your same “indirect intent” paywall over again. Instead tailor it to the benefits of the desired feature in order to get the best conversion.
Make your Paywall Easy to Find in the App Settings
Make sure that if a user really wants to purchase, they can find their Upgrade options easily in the App Settings. This paywall should be a multi-purpose “direct intent” paywall that includes a summary of all benefits and all products.
Special offers, whether they are for a holiday, an introductory offer, or just a regular sale, can be a good way to convert users who are on the fence about purchasing.
A special offer paywall can be simple, but should focus on the price difference and how long the user has to redeem it.
You can pop up special offer paywalls at random times (such as after a new user has used the app for a number of minutes), launch them on a schedule for an event such as a holiday, or launch these paywalls when the user clicks a banner.
Summary of Paywall Placement Best Practices
Show a paywall in multiple places in your mobile app. Make sure the paywalls are tailored to the different locations and user intent, and test design changes and products for each one.
Nami can help you setup no-code paywalls and do easy 1-Click A/B Testing. Get started today.
Apple Offer Codes are a great way to help you acquire, retain, or winback subscribers. You can offer special reduced prices on a subscription or provide free access for a limited time. Here is how to find and configure offer codes in App Store Connect.
3. Scroll down to ‘Subscriptions’ in the left hand menu.
4. Then pick the Subscription Group your product is located in.
5. Click on the Subscription product you want to add an Offer Code for.
6. Scroll down to ‘Subscription Prices’ and then click ‘View all Subscription Pricing’.
7. Click ‘Offer Codes’.
8. Click ‘Set up Offer Codes’.
Setup Apple Offer Codes
9. First, let’s setup a winback offer for Expired Subscribers. To do this, provide a name for your Offer. This name used for reporting and internal management. Then select ‘Expired subscribers’ from the checklist. Decide if you want subscribers to also be eligible for introductory offers with this code. Then click ‘Next’.
10. Then select the countries or regions of availability.
11. Select the Offer Type. For our Winback offer, we will choose Free for 1 Month. But you could also select ‘Pay as you go’ or ‘Pay up front’ for a discounted rate.
12. Confirm your Offer Price and ‘Submit’ to create the Offer.
Create Codes for your New Offer
13. Now that the offer is created, we need to create codes so customers can redeem. To do this, click the name of the new offer.
14. Decide whether you want to create one-time use codes or custom codes.
One-time use codes are perfect for email or SMS marketing and are unique to each customer. One-time codes expire up to 6 months after creation.
Custom codes are memorable codes that can be redeemed by multiple customers. An example would be ‘SPRINGSALE’. Custom codes can be edited to control how many customers redeem it, when it expires, and more.
You can create both one-time use and custom Apple offer codes for the same offer.
Create One-Time Codes
15. To create one-time codes, click ‘Create One-Time Use Codes’ from the Offer page.
16. Pick the number of codes to create for this marketing ‘batch’. Need more than 25k? Create multiple batches. However be aware that your app can’t have more than 150,000 codes redeemed in a given quarter, so watch your limits!
Then pick an expiration date for the codes. The codes will automatically expire in 6 months.
Finally, click ‘Create’.
17. You will see a batch of one-time use codes available. Click ‘Download’ to get a .csv file of the codes and the unique redemption URL that can be inserted into your marketing campaigns. Note: it can take up to an hour before the Apple offer codes are available to be redeemed by customers.
Create Custom Codes
18. To create Custom Codes, click ‘Create Custom Codes’ from the offer page.
19. Enter a name for the code. It should be memorable and short, such as ‘SPRING23SALE’. Be careful! This name can’t be edited once you create it and if you want to use it for another code, you must deactivate this code first.
Select the redemption limit for this code. This controls how many users can redeem it and counts against your 150,000 app redemption limit for the quarter.
Then select an expiration date. If you want the code to expire, you must pick a date within the next 6 months. Otherwise you can choose ‘No End Date’ if the code should always exist. Be careful! The expiration date can’t be edited.
Finally, click ‘Create’ to finish. Note: it can take up to an hour before the code is available to be redeemed by customers.
Redeem Apple Offer Codes
Now you have offer codes created! There are 2 ways to redeem Apple offer codes: direct URL and redemption sheet
The direct URL route is ideal for email or SMS marketing. Grab the Offer Code URL from the top of the offer page and replace ‘CODE’ with either the One-Time Use Code for a particular customer or a Custom code for a promo event. When a user clicks this URL they will be taken to the app store with this code prefilled.
Deep-linking into the redemption sheet with an Apple offer code prefilled
Redemption sheet allows a user to manually type in a code that they’ve received from you at an event, through SMS or push messaging, or from support. Users can either redeem the code through the “Redeem Gift Card or Code” page in their App Store account settings or in your app if you have implemented the presentcoderedemptionsheet API.
Redeem a one-time use offer code from App Store settings
Opening the generic redemption sheet for an app allows the user to type in a custom code
There you have it! All the steps required to setup Apple Offer Codes in 2023.
Try an Apple Offer Code
Want to try out an offer code to see how it works? Take a look at Nami’s house-built app called Serenity - Deep Sleep Booster. Use code ‘FREEFIRSTMO’ to get your first month of service for free.
Looking to improve your subscription conversion and retention funnels? Nami has detailed analytics to help you track and optimize your subscription app revenue. Get started today.
Your mobile app paywall is a key driver of revenue. Intelligently choosing and designing your paywall products will have a large impact on app revenue. Here are our 5 tips for paywall product best practices, from price display to number of products.
Calculate for your users how much their plan will cost them monthly or compared to other products
If you have more than 1 product on a paywall, your users will be comparing the products. A key comparison factor will be the price. Being able to easily show your users how much a product would cost them monthly, for example, is helpful.
You can also show users who much an annual plan would save them over paying by month. While they may not initially want to commit to a longer term plan, seeing clear savings can be compelling.
While [users] may not initially want to commit to a longer term plan, seeing clear savings can be compelling.
Nami paywalls have Smart Text variables built in that allow you to show price saved in comparison to another SKU, automatically! No math required, and no need to update your paywall if prices change.
Paywall Product Best Practice: Don’t hide billing terms
While it can be tempting to just provide the price broken down by month, for an annual product users will be billed once every year, not monthly. So when the user is billed once for a larger amount than was advertised on the product (the monthly price), they will be surprised and upset. Being misleading about billing frequency can lead to support issues and refunds that are avoidable.
Users like to test out services before committing to purchase. Clearly indicating how much time they get in a free trial will help overcome buyer concerns and convert more users.
Try putting the trial length inside the Purchase Button as a clear call to action like ‘Start your 1 week trial’. This makes it clear to the user that they don’t have to pay yet.
Paywall product best practices dictate that if your products have different trial lengths, you should make that clear so that the user isn’t surprised. Unclear trial length is an easy way to get an unhappy customer or a refund request.
Looking for examples of paywalls with product badges? The Nami paywall gallery has hundreds of paywalls from top apps to explore.
Don’t show more than 3 Products on a Paywall
Users are viewing your paywall from their mobile device and trying to decide if they want to pay for your service, and if so how much and how often. While it is tempting to display all your product options in 1 view so that users have flexibility, rarely is this a good idea in practice.
Even if you do offer weekly, 1 month, 3 month, 6 month, and 12 month products, displaying them all on 1 small screen can give a user decision paralysis. They have to compare 5 different products and prices and try to decide how long they will want to use the service and whether they will remember to cancel.
Try setting up a paywall featuring just the annual product and track the conversion rate. Then test it against a paywall with both 1 month and 12 month options. How many users are buying the 1 month product versus the 12 month? How long do you retain the 1 month users?
Your mobile app paywall is a key driver of revenue. Designing for usability can help optimize your revenue streams. Here are our 5 tips for paywall design best practices, from color to length.
Pro tip: squint at your paywall or use an image editor to apply a thick blur effect to it. What elements still stand out? Where is your eye drawn? If there are multiple elements competing for attention even when squinting or blurred, you don’t have a clear call to action. Reduce design elements or use of color until it is more clear.
Looking for design inspiration? The Nami Paywall Gallery has hundreds of examples of mobile app paywalls from top industry apps.
Paywall Design Best Practices: Carefully choose text on your paywall and avoid lots of lines to read
Users are skimming over your paywall on their phone. They don’t want to read through paragraphs of copy, even if the copy is really well written! Stick to a few lines of carefully written copy like an ad, and use short bullets to spell out the benefits of your product.
If you are using a checklist on your paywall, limit the bullets to no more than 7 and experiment with the items and order of the bullets to improve optimization rather than adding more copy.
Use a Carousel to allow users to quickly swipe through features and benefits
Also known as a gallery or a slideshow, a carousel is a component composed of multiple “slides. Slides are made up of text, photos, and even video. Users can use their finger to swipe through the slides, or carousels can automatically advance through slides.
To create a carousel, first add catchy imagery and short, clear copy for each slide. Then optimize your carousel by testing the order of the slides and the number of slides shown.
Pro tip: if the user clicks to unlock feature A, make sure that feature A is explained on the first slide in the carousel. That way the value prop is clear and they don’t have to swipe to search for it.
Looking for more examples of mobile app paywalls with carousels? Check out the Nami paywall gallery.
Include a way to close the Paywall
Users typically need to see the paywall multiple times before they want to purchase. Don’t force your user to make a purchasing decision right away, otherwise they may just close your app and never return.
Make a choice between a scrolling and a fixed-height paywall
Scrolling can be a distraction to the user. Only use this pattern if you have lots of quality content to display.
If you don’t need your paywall to scroll, test and optimize your paywall for devices of all sizes so that there isn’t a scrollbar when there doesn’t need to be. Try reducing whitespace and text size in order to get everything to fit.
