Why Do You Need to Buy Virtual Items?: Investigating Factors Influencing Intention to Purchase in Mobile Games

Mobile games have produced almost half of total mobile application revenue. Freemium strategy is commonly used for monetizing methods of mobile games recently. It is getting more attention of game developers to investigate the key factors affecting users' purchase virtual items. Although researchers start to investigate this salient topic, there is still insufficient academic research on the intention to in-app purchase so far. Therefore, the purpose of this study is to investigate the key factors affecting the intention to in-app purchase in freemium mobile games. We evaluate the effects of psychological needs (i.e. autonomy, competence, and relatedness) and promotion (i.e. free item) on the intention to in-app purchase based on key tenets of self-determination theory and self-perception theory. We conduct an online survey and use Partial least squares modeling for our analysis. The results show that autonomy and relatedness needs are positively related to purchase intention while competence need is negatively related to the intention to in-app purchase. Moreover, the direct and meditating effect of free-item promotion are positively related to purchase intention. Interestingly, although competence need is negatively related to purchase intention, free-item experience positively meditates the effect of competence need to purchase intention. In addition, the effect size of purchase experience on purchase intention is the most significant among the suggested factors. This result shows that game companies need to more carefully consider more seriously about the characteristics of paying users. We expect that the findings of this research will deliver significant research insights and actionable implications for researchers as well as practitioners.