It doesn’t work because Real Racing 3 rewards the user with having to wait, which means the incentive to win the next race becomes being able to pay more money — an unappealing proposition.
Other freemium games, which have pulled off the time-wasting mechanic more successfully, offer In-App Purchase as a way to skip the “work”. In FarmVille, for instance, payment can be used to speed up the growing of your crops, which is separate from the reward of having a nicer farm.
Applying the Real Racing implementation to a gardening game, the hypothetical game would be to plant and carefully nurture the flowers until they are ready, then have to wait/pay for the plant to move from the greenhouse to the garden so it can appear publicly to your friends. Annoying, huh?
For Real Racing, I think a much better way to use In-App Purchase would be to split the game functionally into campaign and arcade modes. To unlock the campaign, there’s a flat fee (which can be reasonably pricey, between five and ten dollars) but the arcade follows a free-to-play model. In the arcade, the enjoyment comes from unlocking upgrades and new maps to race on — EA monetises by charging for additional cars and skins.
That seems like a much more realistic method of encouraging users to spend more money than they would if the game cost $5 straight up in the App Store.