We tried selling a game - it doesn't work. We have a free (ad-supported) and paid version of our game, and we make 95% of our money on ads.
Adding removing ads as an iAP to the free version, instead of having multiple versions of the game on the store, saw that go from 5% to 15% or so.
It's RARE to have any true success in the mobile game market. It's even RARER to have that come from a game that has an up-front cost.
iAP is the new shareware. Anyone that bitches about iAP has to get their head around this. The market dictates how people are willing to spend money, and it's via iAP, not up-front costs.
We love making games. We love our job, and our company, and we want to keep doing it. But there's a hard truth that ad-supported free games have very, very low ARPU - for us, in the $0.20 range. We're lucky to have millions of downloads and hundreds of thousands of daily active users, but very few game studios are.
Someone that buys the ad-free iAP is worth 5x our average ARPU. So selling people customizations or whatever else iAP is the only way to raise ARPU to anything sustainable. Gamers don't (and never will) spend $60 on a mobile game again, and we have employees to pay and families to support. Yes, it can get exploitative, but if you have a better idea of how small game companies should survive - real ideas, not trolling - we'd love to hear them, because we would implement them immediately.
Edit: grammar.