How to monetize an app?
Maybe this is one of the dilemmas most common at the time of deciding to develop a mobile app. In this regard, know if you have the possibility to recover the investment is the key, that’s why it’s important to know how we can promote our app and obtain revenue. In this post, we tell you how to recover your investment in a mobile app development.
There are many ways to monetize our mobile application:
- Paid applications: With this kind of apps you only have to pay for download. In despite of, it can include another monetization ways that we explain below. This type of monetization is often used by applications that only offer you just one service such as photo editor, GPS or mobile games. Moreover, this modality has a subcategory that consists of providing an incentive to the users to download the app. To do this, developers frequently offer a free trial version we can call “Fremium apps”. After that, they offer a Premium version where you have to pay to access to many more features. With this way of purchasing, Google and Apple take a percentage of the overall transaction, around 30% of the total price and then our payment will vary depending of the amount of downloads we have provided through our app. This business model is more usual for iOS applications due to Apple users are used to pay for it. An example is Cut The Rope game that, although it has a free trial version, you have to pay 2,69€ to access to Premium version.
Within this category, we can include Whatsapp because after the first year of subscription you have to pay 0,89€ for iOS and Android.
- In- App Purchases: Here, you can download the app for free (although there are paid apps that include this method) but before you can access to extra features you have to pay for them. It’s possible that you get a greater profitability with this way, due to the users will spend more money on unlocking additional features compared to the money they will spend on downloading your app. The different prices will be established by the developers both in Apple Store and Google Play. As the way above, these platforms take a percentage of each purchase within the app best known as In-App Purchases or micropayments. The key is to offer the app’s full version for free to attract the users and then, once inside the application, they are prepared to pay for getting extra life, special powers, coins, unlock levels, among other options in games and getting maps of different countries paying for each of them in GPS apps. An example of app that uses this way of payment is Emotiboom, a mobile game where you have to pay to get coins or to unlock pause button.
- In-App advertising: This is one of the options most common. It consists in offering the app for free and charge for the advertising that appears on it. This is the case of popular games like Angry Birds. Banner ad is the way most used; revenues will be obtained from each click made on the banners, from each installation of the app promoted on the user’s mobile and from advertising impressions. Another way is Interstitial Ad which appears on full screen and it can appear between level changes, for example, or when you open the app. This is one of the most visually impressive way because it can include images, videos or links. The only disadvantage is that interrupt the user’s experience in a shameless way compared to the Banner ad. Its advantage is that the interstitial impressions and clicks are better paid than banners. Some of the platforms to promote your app are AdMob, iAd, Inmobi, Mobfox, Kiip or Millennial Media
Moreover, as we said at the beginning, you can combine all these ways. You can find paid apps with micropayments and paid or free apps with micropayments and advertising. For example, Real Racing is a free game but it has micropayments, moreover for getting coins without micropayments it suggests you to watch ads within the app.
Finally, we could include a fourth category that consists in selling our app to third parties. This may seem difficult but it is not impossible to do. And if you have a successful app and find a person interested in buying your app? This will be a good way to monetize your application. There are examples of free applications that didn’t generate incomes but due to their popularity achieve added value. This is the example of Instagram that was bought by Facebook for $1.000 million.
As you can see, if you want to obtain incomes through your application or game to recover the cost of an app development we suggest you include micropayments and advertising in your app, as it’s difficult to monetize without any of these methods. It is very important to know what type of app you have to decide what type of purchasing you need.
If you have an app that you want to monetize, do not hesitate to contact us. We will help you in everything you need.
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