Turning it Around
After several months of tuning the UI in Monkey Drum, adding a character customization system, being featured by Apple, and being reviewed by several sites, the app was still failing financially. At this point, we had a thought: Why not release a separate, "deluxe" version for an up-front price, without the in-app-purchase? We would tune the in-app currency earn rate to be even more forgiving, and simply remove the option to buy additional currency. We would also put it in the Education category, as this seemed to be where it was appreciated the most.
This "Deluxe" version worked out considerably better for us -- Apple featured it in the New and Noteworthy (Education category) for four weeks, a better featured slot than the original had ever achieved, and we were able to earn better than the average iOS app.
It was still not a smashing success, but it easily made 20 times or so what the free version did. We believe this worked out for us because the app itself was very appealing and fun, and we were able to drive customers from the free-to-play version to Deluxe with a launch popup, and from the in-app store where we suggest that users may want to check out the deluxe version if they don't want to bother with IAPs. It was basically the lite/full version model, but kind of retrofitted in.
I would suggest that if your plan is to release your app as "free-to-try" with a paid upgrade to the full version, then please, please consider releasing a separate paid version as well. There is a large portion of users who will gladly pay you $2.99 upfront if the app is highly rated and looks entertaining.
But if all you have is a free version, a large portion of these otherwise willing customers will be lost in the long path from download, to play, to delight, to desire for more, to payment. It's just a matter of statistics, if you think it through.
In our case, building the "Deluxe" version as a separate app took us perhaps two weeks; it was well worth the time. It also gave us a fresh pass at Apple's editorial team (which paid off in the form of a N&N feature) and allowed us more visibility worldwide in various pockets of the app store. It's all about visibility.
A Note on Flippfly
Perhaps you've read through this list, and rather than identifying an action plan for your next F2P game, you've spotted some patterns that kind of turn you off. This was the case with us as well.
We don't like the idea that "whales" are what we need to sustain our games. We don't like the idea that only 3 percent or so of our users will ever experience our games in their fullest, and that the other 97 percent will probably be left wanting, if we're "doing it right."
We also don't like the idea of spending a significant portion of our time analyzing and tuning our user flow towards an in-game store, rather than focusing on the game itself. And we especially don't like the idea that even our paying customers will be nagged for additional money in a never-ending cycle of microtransactions that never quite satisfy. We want to build memorable and unique gaming experiences, and in-game monetization -- in its most effective form -- seems to always get in the way of that out of necessity.
These reasons form a large part of why we changed our direction as a company away from mobile as our primary focus. We're very proud of Monkey Drum. We went out of our way to be ethical with it, and with over 80,000 users, we have never had a single complaint about the in-app purchases, despite our core audience being five to seven year olds. And we don't believe that F2P is necessarily "evil." But when we looked at the reality of what it takes to really thrive in free-to-play, we decided that we'd rather be able to focus more of our time on making great games.
So we made the decision to refocus ourselves on the PC platform, where there is still a thriving community of gamers who are willing (indeed, who often prefer) to pay for their games upfront rather than piecemeal. Our first major game release, Race The Sun, will ship for PC for somewhere around $10, with an early purchase discount much like that of Minecraft. It will have a free-to-try demo with many of the lessons we've learned from our F2P experiment, and a paid mobile version will come later -- if it makes sense.
We couldn't be happier with this decision so far.