Experience of the Youth

in Buying In-App
Purchases of Games
 Chapter 1:
INTRODUCTION
Background of the Study
Students are usually given an allowance at an early
age, they are exposed to budgeting their finances so that
when they begin earning their own income later on in life
they already know how to manage this said income. It is
inevitable that they will experience the turbulence of their
wants getting in the way of their savings. Students of
different academic levels also acquire and spend different
amounts of cash. In accordance with the United Nations
definition, the youth are those individuals from age 15 to 24.
 Background of the Study
Younger students, such as those in the earlier years of Junior High School, are still
financially dependent in comparison to Senior High School and College students who
receive an allowance set for a month or those that are already generating their own income.
In a study by Villanueva (2017), there is a larger financial independence of consumers when
they reach college. These expenses range from essential to leisurely.
Games take up a person’s time whether it be for leisure or competition. An article on
LAPAAS lists the different types of Business models used by games to earn revenue. The
Freemium Business Model is one of the mentioned Business models whereas the game is free
to download however there are in game purchases, otherwise known as “microtransactions”,
which players are frequently encouraged by game developers to buy for a better experience
or advantage in these games. Acquiring these in-app purchases from games add to players
success or achievements in game. Other than that, purchasing these add-ons for the sole
purpose of gaining more aesthetic value in game. There are two classifications of in-game
goods: Functional-based, and Ornamental-based (Lehdonvirta, 2009).
Background of the Study
One game that can be used as an example is Cookie Run Kingdom, a free-to-play
game, however there is a wide range of in-game currency bundles that can be
bought. Besides being a story and battle-based game, it is also a gacha game.
Pulling for a character a player likes or needs for the game can be a gamble,
especially since the game's gacha mechanics gives little chance for a player to gain
their desired character in just a few pulls. Games similar to this earn greatly from its
players. In a study by Wohn (2014), younger players are more likely to use real
money to purchase items in-game compared to older players, who were those aged
19 and older. In this study, there was a comparison between players who spent a
large amount versus players who spent a minimal amount in the game. It was
usually due to aesthetic purpose and value, which they concluded that the habit
was equivalent to spending money on real life luxury goods. A study concluded
that 17 out of the 100 respondents answered that buying in-app purchases in
games caused them to fall into an addiction of overspending.
Background of the Study
63.7% of the study showed that players buy these microtransactions for the purpose
of in-game satisfaction and achievements, 53.8% have grown addicted to buying in-
app purchases, and 45.1% when it came to increasing their in-game strength (Kaur
et al., 2020).
With the growth of games and their tactics at earning revenue, possibly
results and effects this may have on the youth, who are of an age to take full interest
and time into these, must be studied for record. The way the youth deal with this
pastime and the way they choose to spend their money into this must be evaluated
in order to fully understand the grip this revenue strategy has on the younger
masses. This study aims to achieve its goal of understanding the experience the
youth have on buying In-App Purchases of games .
Statement of the Problem
Over the years, there has been a rise in games with in-app purchases.
This business model is a positive for gaming companies. Gaining more
revenue in recent years in comparison to the past (Thomas, 2022). With
the growing success of the business model, it has earned its large share
of consumers. Individuals from all age groups have shown interest and
have spent a decent amount of time into these kinds of games. One of
the reasons being its business model, which pushes players to spend
more and more money for an even better experience in games. In
comparison to older individuals who play games, the younger bunch are
more likely to spend actual money on these in-app purchases (Wohn
and Na, 2014).
Statement of the Problem
The players succumb to this business tactic, sometimes spending more
money than they intend to spend. Small amounts may grow into larger
sums due to some games having the option of microtransactions more
evident than others, leading to a spending addiction which could run
players’ wallets dry. In this study, the researchers aim to understand the
experience of the youth in buying in-app purchases and how these have
affected their spending habits, whether in-game or in the real world. An
end result of fully understanding the Freemium Business model and
acknowledging the effect this has on the spending habits of the youth
and putting this cause into light.

 Research Questions
The main objective of
this study is to understand the
experience of the youth with buying in-app purchases of
games. This study strives to answer the following questions:

1. How much do individuals spend on game In-App

Purchases?
2. How frequent do they spend on game In-App
Purchases?
3. How does this behavior adapt to their spending habits?
 Significance of the Study

Besides the researchers, many individuals gain helpful results from this study.
The result of the research will benefit the following:

Youth. This study assists the youth with their spending habits, whether it may be
reducing the amount they spend on unimportant games and maximizing their
funds for worthwhile endeavors or for general understanding of the Freemium
Business Model .

Businessmen. This study benefits those working in business as the results aid
them in looking for a sustainable tactic that increases their revenues.

Future Researchers. This study may aid future researchers who choose to tackle
the topic further or topics of similar ideas.
 Scope and Limitations
This study intends to
look into and understand the
experience of the youth with buying in-app purchases of
games. The following parameters are set as a limit to
ensure the best results for this research:

Subject Matter - This research focuses on understanding

the experience of the youth who buy In-App Purchases in
games, such as how these affected and developed their
spending habits.
 Scope and Limitations

Place and Time - This research is conducted in Pagadian

City during the school year 2022-2023.

Research Participants - The participants for this research

will be the youth, those within the age range of 15-24 years
old, who are gamers and have bought In-App Purchases
prior to this study.

 Definition of Terms
This section shall define some terms used in this research in order for the readers to
have a clearer understanding of the study and for the researchers to interpret their
findings accurately.

Experience. The individuals experience spending money in games such as how much
they have spent and how these have influenced or affected their spending habits.

Freemium Business Model. A revenue earning strategy in games in which the game is
free to download but there are additional transactions that can be made in-game.

Games. This could be offline or online games with in-app purchases.

Gamer. A person who frequently plays different types of games or one who takes interest
in them in comparison to others.
 Definition of Terms

In-app purchases. Are extra content or subscriptions that you buy inside an app

Microtransactions. In game transactions in use of online payments.

Spending Habit. The repeated routines and practices you have around using money
to purchase things.

Youth. Those individuals from the ages of 15 to 24 years old.

 Chapter 2:
Review of Related Literature
This chapter reviews the studies, ideas and theories that have a relation
to our research. The information presented in this section will assist in further
understanding the various concepts within our study.
 Games of today rely on their
microtransactions. Players spend on In-
app Purchases for a variety of reasons:
Cosmetics in game, sentimental value,
to avoid grinding for in-game currencies,
and to advance against other players. In-App
Players also invest their money into the
game when it becomes "pay-to-win". Purchases
Those who are more invested in playing
the game result in spending money on in Games
its microtransactions. (Lo & Fristedt,
2019).

In-App Purchases of Games

In an article by Tafradzhiyski (2023), In-app
Purchases are one of the most common ways of
monetizing games and non-game applications. In
comparison to ad-based and paid applications, In-app
Purchases gain more revenue. The reason being the
Business Model that they follow. The app is free to
download however later on there may be additional
items that would benefit players later on in-game which
the game pushes for the players to buy (Blasa).
 Students who are managing their
own finances for the first time away
from the assistance or monetization
of their parents are met with the
responsibility of spending and Spending
storing these said personal finances.
Behaviors that signal poor spending Habits
habits are lack of discipline when
there is a presence of continued

overspending.

 Spending Habits
Spending habits play an important role in how
long their finances last and wise financial
management (Obagbuwa & Kwenda, 2020).
Written in a study by Leclerc (2012), College
students' spending behavior varies from family,
race, and socioeconomic status.
 Chapter 3:
Methodology
This chapter highlights the methods used throughout the study.
Specifically, this chapter includes the research design, research locale,
research participants, research instruments, data gathering procedure, data
analysis.
 Research Design
This research follows a qualitative approach and uses
case study as its research method. The case study
method encourages an in-depth understanding of an
already occurring issue or phenomenon. This method
is utilized in the fields of research in business, law and
policy (Crowe et al, 2011). We, the researchers, believe
that using the Case Study method will further assist us
in this study in achieving the information we desire to
collect.
 Research Design
In this study, the researchers use the Explanatory case study type,
in which information is gathered for the explanation of an
occurrence (Cherry, 2022). The researchers believe that the
Explanatory case study method will help them gather the best
and appropriate results for their research. With this method, the
data gathered would further explain the effects of In-App
purchases on the spending habits of the youth. Further
understanding is being sought after by the researchers. The
researchers also believe that the qualitative approach suits the
study they chose, as this approach will help them understand
behaviors and certain actions taken by the participants.
 Research Design
In addition, the following will strengthen the reason for taking the
qualitative approach:
Participant’s Experience. The researchers extract the data from
the participants involving their behavior towards these games that
promote their In-App Purchases, whether it be for valued aesthetics
or to increase their value in-game.
Participant’s Behavior. To further push the study’s qualitative
nature, the researchers then take the participants' experience to
know the effects these have on their behavior. To be specific, their
spending habits, how they spend their money in the game or if these
affect the way they spend their money in the real world.
 Research Locale
The location as to where the study takes
place, Pagadian City, is located in the
province of Zamboanga Del Sur,
Philippines. Written in an article by
PhilAtlas, Pagadian City is a city along the
coast of Zamboanga Del Sur as well as the
regional center of the Zamboanga
Peninsula. It is the capital city of
Zamboanga Del Sur. Owning a land area
of 378.80 square kilometers, contributing
to 8.45% of the province's total area.
Composed of 54 barangays with a
population of 210,452 in the year 2020.
Participants of the Study
To ensure relevance and utmost validity of the results of
the study, the researchers will choose 15 participants
under the age range of 15-24 in Pagadian City,
Philippines who are gamers. In addition to these factors,
they must have experience of buying In-App Purchases
in games. Regardless if their purchases are done
frequently or not, which can be of aesthetic value or
success increase in game. The researchers use the
Judgemental or Purposive Sampling method to select
the participants of the study.
Research Instrument
The primary instrument to be used in gathering the
necessary data needed in this study is a semi-structured
interview process. Following a semi-structured interview
format will further assist the researchers in collecting
appropriate answers from their chosen participants. The
interview questions will be open-ended as these will further
allow the participants to answer in a way that won’t restrict
them from sharing additional information that the
researchers may find relevant to the study.
Data Gathering Procedure
First and foremost, the researchers will ask permission from their
adviser and the school principal for approval of conducting the
research outside of school. A formal letter of approval will be given to
the adviser and principal where their signatures will be affixed for
documented proof. Once signed, the researchers will present to their
research adviser the semi-structured, open-ended interview questions
in which the researchers will ask whether these are suited for their
study. After these are all settled, the researcher will move to the
second phase for gathering the data.
Data Gathering Procedure
Next the researchers will select the rightful participants for their
research. We, the researchers, decided on this technique as the
participants we need are those individuals who have their experiences
with buying the In-App purchases in games whether it be a frequent or
seldom purchase. Respectfully, the researchers will ask permission
from the selected individuals for their participation in this research. If
there is certain information a participant wants to keep private, the
researchers will respect said individual’s decision. As much as
possible, the researchers would want to benefit but at the same time
make sure their participants are comfortable.
Data Gathering Procedure
Finally, the participants will answer the interview questions with
their best possible answers. Follow up questions will be
presented if necessary, but these will not interfere with the
validity and relevance of the participants' answers. Upon the
collection of the data the researchers need, the researchers will
write down the information they have retrieved from these
individuals in accordance with the study.
 Data Analysis
Once the data is transcribed, it is then coded, analyzed,
interpreted and verified. The process of transcribing the
interviews can help the researchers gain more understanding of
the subject from repeatedly listening to and reading the
transcribed interviews. Coding the data will begin once all the
data is fully transcribed. The codes applied are keywords which
will be used to categorize or organize text and will be
considered an essential part of qualitative research. The data
were analyzed, categorized and organized into themes and
further sub-themes which will emerge through the coding
process.
 Data Analysis
The themes that emerged were assigned a specific code
accordingly. The next stage involves interpreting the data by
identifying any recurring themes throughout and highlighting
any similarities and differences in the data. The final stage
involves data verification. This involves a process of checking
validity of understanding by rechecking the transcripts and
codes again, thus allowing the researchers to verify or modify
hypotheses already arrived at previously (Sarantakos, 1998).
 Ethical Consideration
To maintain integrity, the researchers put to practice
the ethical values. Whereas information in this research
is approved to be shared by the participants prior to the
recording of their answers. The researchers vow to
uphold the moral standards. No information will be
manipulated or interchanged. All data collected will
remain in its raw and purest form unless the participant
speaks against it.
 Ethical Consideration
The researchers promise to implement transparency
and accuracy of the gathered data. The study will
respect the decisions of the participating individuals.
To keep the research professional and righteous, no
scrutiny will be put against the participants. When
privacy is requested, it will be met for both the comfort
of the researchers and the participants.
 Ethical Consideration
Besides the information to be disseminated from the
participants, no signatures or legal agreements from
both research adviser, principal or any official whose
permission the researchers will request will be forged
by the researchers.
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 END OF PRESENTATION
RESEARCHERS ARE NOW OPEN TO ENTERTAIN
QUESTIONS AND CONCERNS