Learn the secrets of how to monetize a mobile app and build a revenue from the software with these helpful bits of advice…
— The author’s views are entirely his or her own and may not always reflect the views of Xanjero.
Can you imagine today’s modern mobile devices screens without apps on it? Most likely not because the app market is huge these days as, according to data from Statista, the global mobile app revenue was worth over $365 billion in 2018. Moreover, throughout the same year, mobile apps usage accounted for about half of all traffic globally.
Mobile apps have a huge impact on our lives these days. We use them for almost everything we do in this modern world from taking a cab to meditating, purchasing goods, or for entertainment. With more than 5.5 million mobile apps that are installed and used by people, it is certain that the app industry will only continue to grow significantly, fueled by the growth in mobile device usage.
But, when you switch sides from being a user-only to an app creator, can the growth of the app market benefit you? Can you make a living out of your mobile app? Sure, you can! You just need to learn how to monetize it.
Monetizing an app means succeeding to earn profit from a mobile app that is free for users. Today’s users simply won’t be willing to pay for an app when there is such a huge app market from where they can get a similar one for free. In fact, 95% of the apps that users can find in the Google Play Store are free while 90% of apps that exist in the iOS App Store are also free. So, like it or not, with so many free apps to choose from, the chances for users to pay for your app are extremely low. Data shows that only 33% of mobile users paid for an app in 2017. And, most likely the numbers only decreased since.
Yet, worry not! There are still multiple great ways in which you can earn money even if you have a free app.
In-app advertising is one of the most common ways in which you can earn money with a free app. All you have to do is to partner with different brands and sell the advertising space of your app.
Whether you display advertisements as a native, banner ad, or video, your app will bring you revenue without you actually doing anything more than just promoting brands. Data from Statista shows that in-app advertising and app store purchases are expected to be worth $188.9 billion by 2020. So, it is clear to see that mobile apps play a huge role in attracting consumers.
However, if you choose in-app advertising as a method to monetize your app, there is one important aspect that you should keep in mind, and that is the user experience. Make sure you don’t include too many ads that can become disruptive for the users.
Also, you need to choose trustworthy brands that will help you avoid user drop-off. Why choosing partners carefully is important? Because if a user purchases a bad product based on an advertisement they have interacted with within your app, it is very likely to associate the negative experience with your app as well.
Collect data and sell it to advertisers
Like it or not, third parties should become your best friends if you want to make good money with your mobile app. Today, we live in an era that is data-driven. From creating marketing strategies to reshaping products and services based on customer data, all businesses from all industries are eager to have access to more data about their target audience and are willing to pay good money for it. And, there is no reason why you wouldn’t use this to your advantage.
In this data-driven world, data monetization is a huge opportunity for app developers. But how does data monetization work? Simply put, you collect user data and sell it to third parties which are often marketers, advertisers, or research companies. Why are third parties willing to pay money for it? Simply because using the data to improve their products, services and the way they interact with their target audience will bring them good money in return. So, it’s a win-win partnership.
How to sell data? Well, selling data after you collect it may sound a bit more complicated. Since selling data to third parties often involves non-personal user data, most data collectors prefer to purchase them in bulk. So, you aren’t directly selling it to companies or marketers but rather to data intermediaries who further transfer it in bulk to data collectors.
Include real money gaming features
If you have a game mobile app, monetizing it couldn’t be any easier. Apart from using other methods to monetize mobile apps such as incorporating in-app ads or collecting and selling user data, you can actually ask the users for money to make the game more exciting for them.
John Reyes, a mobile app developer at PickWriters explains “ Mobile game monetization will highly depend on the roadmap you are laying out for your game app. First of all, it should have a monetization model right from the beginning, from adding a lot of real money features to working with the best game localization companies to increase your player base. Secondly, you can add different strategies, such as offering free rewards in exchange for watching a video ad, to create a fair balance between paid features and rewards and great user experience.”
So, for example, if your users get hooked in the game but need additional coins or boosters to move forward within the game, you can allow them to purchase these features with real money.
Ask for donations
Today’s mobile users are very likely to spare a small percentage of their money to support the brands they like. And, you shouldn’t be afraid to ask them to support your app. However, you obviously need to have a great mobile app for users to get hooked and become loyal to it.
Donations can be made either through Crowdfunding or PayPal donations and they can really help you earn some good money. But why would users donate money to support your app? Let’s be honest, n-app ads aren’t exactly going great with user experience because they can make users frustrated leading to drop-off.
So, if you don’t want to integrate in-app ads, you can just ask your users to make a donation to support your mobile app. If your app serves their purpose, offers excellent user experience, and means a lot to you, as a developer, your users will most likely be willing to donate for it.
Add a premium feature
Take a look at some of the most popular apps these days such as YouTube mobile app or Adobe’s Lightroom app. Both of them include features that are only available to Premium users. Technically, both apps are free for users to download. However, in order to unlock more features, content, and remove in-app ads, users must purchase a Premium subscription.
Let’s take YouTube’s Premium membership, for example. Users who pay for the Premium membership can enjoy features such as ad-free videos, save videos and songs on their mobile device for offline, and the opportunity to play background music from the app while using other apps.
But how many users are actually willing to pay for Premium features? More than you would imagine. As long as you convince your users that your app is worth their money and loyalty, they will most likely be willing to pay for recurring fees. So, make sure that the free features of your app are robust enough to hook users and the paid features should be worth buying.
Mobile apps can be a great additional revenue stream if you see and treat it as a business. And, with a solid marketing plan and monetization strategies, your mobile app will certainly bring you good money in return.