At Amazon, we love apps—so much, in fact, that we develop many mobile apps ourselves, and even have an in-house game studio. On the heels of the recent press from the Localytics report that the leading Android tablet is Kindle Fire (with 33% of market segment share worldwide and more than half in the US), we wanted to post some best practices for using in-app purchasing from our colleagues at Amazon Game Studios—developers of the recently released game Air Patriots.

This post is from Ernie Ramirez, Executive Producer, Amazon Game Studios:

Air Patriots is a new type of tower defense game where players control a squadron of airplanes by drawing the attack paths they use to engage the enemy. Air Patriots launched on November 1, 2012, on Amazon, iOS, and Google Play. Although our monetization on Amazon has been great (generating 73% higher ARPU than iOS, and both stores generated similar total revenue), we had some key learning during our initial launch. For example, our focus groups indicated that the two things customers would like to buy were more maps & more planes, in that order. This meshed with our goal of providing Air Patriots customers “big value” for in-app purchases. We reasoned that we would emphasize additional maps for purchase because it would give customers significantly more play time and provide a feel that they paid for something really big and worthwhile.

We originally structured Air Patriots to provide gamers 2 of the 7 maps for free, with the remaining 5 requiring an in-app purchase. Additional airplanes were available using the in-game “soft currency” (gears). As a test, we also included a fully-loaded helicopter available via in-app purchase. It turns out that, after launch, the helicopter was our top-selling individual in-app item, and customers were responding negatively to the 5 additional maps. We received feedback that customers were feeling arbitrarily blocked from progressing in the game, which was not our intention!

We updated the game—reduced prices of our in-app items, increased the amount of maps available with the in-game “soft currency” and offered more planes for sale with in-app purchasing. Customers responded immediately—the sales picked up and we started receiving reviews describing the game as “so darn addicting—pay a couple bucks for different planes. So cool!”

To recap, here are a few things that we recommend to other mobile game developers:

• We discovered that selling main-line game content like levels or expansion packs via in-app purchasing in a freemium game risks making customers feel arbitrarily blocked and frustrated

• Customers prefer to buy things that improve their performance and/or give them new abilities to make them feel “stronger”

To learn more about the Amazon In-App Purchasing API and Amazon Mobile App SDK, head to our documentation here. To get started with our program, go to the Amazon Mobile App Distribution Portal, and once your app is submitted, submit a request to get your app marketed.