Using a "Lite" version to show how it feels to use what you make and what kinds of things your app can do is definitely a good way to find customers who will pay for the full version of your application. But store shoppers tell us it only works if you follow a few simple rules:
Make sure the functionality you decide to include is complete. Battles that require weapons only available in the full version, for instance, are annoying and irritating instead of enticing.
Don't set time limits on your "Lite" version, either for run times or life times. Applications that will only run for a set number of minutes per session, or that expire altogether after some period of time, don't recruit customers so much as leave a bad taste in their mouths.
Only display the UI for what your "Lite" version will do. Grayed out menu commands, "more track/car choices" you can see but not select, etc. makes your "Lite" version feel more like a commercial than a product, and an annoying and ineffective one at that.
Do include information about your full application, including an option to buy, in either your application's About section or on the splash screen. Just make sure the option to continue using the "Lite" version is there as well. A good impression lasts forever.
It's important to follow these simple rules not only to create a better user experience, but also because your app will be returned to you by the App Review Team for modification if it is found to have time limits, incomplete functionality, or disabled functionality. Read more app submission tips