Consumers favor subscription apps over one-off purchases

Mobile users are becoming far more willing to subscribe to a service than to make a one-time purchase according to a new report.

A study from mobile user acquisition specialist Liftoff has analyzed more than 349 billion impressions across 992 mobile apps, 5.35 billion clicks and 76.6 million total post-install events.

It shows that the cost to acquire a user who makes a first-time-purchase is up more than 60 percent year-on-year, making it the most expensive acquisition across all mobile app categories. However, high cost doesn't equal high return -- in the past year alone, purchase rates have plummeted by a massive 213 percent.

Meanwhile, costs to acquire a subscribing user are down by 58.2 percent, while engagement is up 45 percent, demonstrating that users are shunning traditional ownership in favor of the advantages of subscription.

The results also show that iPhone users are more likely to subscribe, with those on iOS having 121 percent higher subscription rates (10.9 percent) than Android users (2.7 percent).

"The subscription model, particularly in e-commerce, offers consumers a convenient, personalized, and often lower-cost way to buy what they want and need," says Mark Ellis, CEO and co-founder of Liftoff. "Marketers looking to capitalize on this cultural shift should explore subscription-based models or tiers, or take note of key points in the year when purchase behavior is up to get the most bang for their buck."

The full report is available to download from the Liftoff site.

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