You have an app idea that you are sure is going to be the next big thing. You put in a lot of effort to plan and design the app, hired the best app developers to work on your project, and ticked off all that is necessary for success.
All these efforts are unlikely to yield results if you don’t have a monetization strategy for your app. How do you plan to make money from your mobile app?
While free apps might have a higher chance of being successful on the app stores, making money off your free app requires a carefully thought-out monetization strategy. Unlike with apps that have a clear price tag attached to them, making money from free apps is somewhat complex.
There are multiple ways to make money from your free app, and each monetization method has its own set of pros and cons. Read on to get critical insights about how free apps make money, what options are available to you, and the pros and cons of each, helping you choose the one you can use to maximize profits from your mobile app.
Digital advertising via mobile applications has become a go-to strategy for marketers. Its surge in popularity has resulted in high returns for mobile app developers. Users are spending an increasingly large amount of their time on smartphones, making apps a highly effective platform for advertising.
Pros of advertising model
Cons of advertising model
To be successful at in-app marketing, you need to incorporate the ads in such a way that they don’t detract from user navigation of the app. Relevant content that actually provides them value, instead of meaningless and irritating adverts, is the way to go if you wish to follow this revenue model with your free app.
2. In-app purchases
In-app purchases bridge the gap between free mobile apps and ones with premium features. While the app itself is free to download, users can access the app’s premium features by purchasing and unlocking them.
Pros of in-app purchases
Cons of in-app purchases
To successfully implement in-app purchases within your mobile app, you must have an understanding of human psychology to help you design features that compel the users to hit the buy button and complete their purchase. App revenue follows the model for a freemium app, which is a hybrid between free apps and premium apps.
3. Subscription model
In the case of content-based mobile apps, a subscription model for making money from your free app works wonders. The revenue generated is more or less consistent. Subscriptions can be offered on a monthly or a yearly basis to incorporate choice for app users.
Pros of subscription model
Cons of subscription model
Simply knowing how free apps make money isn’t sufficient. The application of this knowledge is what matters.
There isn’t one single correct answer to which monetization strategy you should choose for your free app. You could pick one that best fits your needs from the options available or create a mixed monetization strategy for your business that combines two or more of these methods.