What should I ask about a mobile app’s in-app purchase and refund trends?
Ask for purchase and refund reports from the store consoles, broken down by item and by period. Compare what customers buy with what they ask to have refunded. A rise in refunds after an update or a price change often signals a problem the revenue totals hide.
Request the sales reports straight from the store dashboards, not a spreadsheet the seller built. They should show gross purchases, refunds and the net amount paid out after the store’s cut. Ask for them by item so you can see whether one product carries most of the income.
Study the refund pattern. Ask when refunds spike and what happened around that time: a new release, a bug, a price change or a promotion. Ask what customers write when they ask for a refund, and whether the seller has changed anything because of it.
Ask about subscriptions separately from one-time purchases. For subscriptions, find out how many customers cancel and when. For one-time items, ask whether buyers return to purchase again or only once. Check for dependence on a small group of heavy spenders. The answer changes how steady the income looks. Finally, ask your accountant to match the store payouts to the bank deposits, and to explain any timing gaps. Put your findings into the purchase agreement as questions your lawyer can turn into promises. Ask too whether any items were removed or renamed, which can break comparisons across periods.
Key takeaways
- Use store reports, broken down by item and period.
- Look for refund spikes after updates or price changes.
- Check whether a few big spenders carry the revenue.
- Ask for refund reasons in the customers’ own words, not only the counts.
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Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 02Business Development Bank of CanadaGovernmentWhat are financial statements?
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