Developers spend countless hours building their products, ripening them like fruits until their harvest day. But how can they expect the biggest profits worthy of their contributions and efforts?
Well, app monetization presents multiple paths developers can take. Besides focusing on product quality, picking the correct method and exploring other helpful opportunities for increasing revenue is equally crucial.
Importance of monetization approach
Monetization represents the methods any product owner uses to generate money. Regarding apps, you immediately think of subscriptions, a favorite for many companies. However, it is certainly not the only viable option.
It’s possible that many apps would crash and burn if they attempted to offer subscription-based services. Thus, each app niche has a particular monetization strategy as the preferred one. For example, streaming platforms rely on subscriptions, while many mobile games are free and generate earnings through ads and in-app purchases.
Each approach might sound profitable on paper. However, careful market research is necessary to observe the most successful trends.
Freemium vs. premium
Freemium and premium strategies indicate two strategies. The former means that apps have two versions: free and paid. The key aspect is that the free version has significant limitations, preventing users from taking full advantage. Users must subscribe to the product if they wish to break these constraints. On the other hand, we have a premium, meaning the application only has its premium version; no free usage is allowed.
What is the benefit of letting people use your product for free (even with limitations)?
One advantage is that users get comfortable with the app and develop a habit. Thus, they will likely convert when the free version limits become more evident. Of course, free versions commonly include other monetization strategies (such as ads).
Ads and in-app purchases
Ads and in-app purchases pair best with free applications. Thus, users can use the program without cost in exchange for watching an occasional ad. By including various in-app purchases, developers can make money from people wishing to go further (like advance faster or play longer in a mobile game).
Of course, both options require careful implementation. For instance, ads should help you earn money but shouldn’t overly disrupt users’s experience. Furthermore, in-app purchases, such as strategies with pay-to-win options, shouldn’t be necessary.
Internet bandwidth sharing
A free application can also require something other than money from its users. One such option is turning to an app monetization platform specializing in sharing unused internet bandwidth. You monetize apps by letting users pay with their asset: the internet. Then, the monetization platforms turn these contributions into funds for you.
Passive income opportunities
One of the biggest advantages of app monetization is its ability to generate passive income. Once implemented correctly, strategies such as subscriptions, ads, or in-app purchases can continue to generate revenue without constant intervention. For instance, a well-designed app with a solid user base can bring in continuous earnings while developers focus on updates or new projects.
Subscriptions
Subscriptions aim to establish long-term relationships between companies and users. However, when picking this option, it’s crucial to understand that customers need to see the potential for long-term usage. A simple example might be a content creation app, which specialists will need to use for their work. In other cases, it could be a streaming app, keeping users invested in the seemingly never-ending content stream.
One-time payments
Some applications can do well with one-time payment monetization. It’s simple: users pay once and enjoy the app forever. However, since the transaction only happens once, the price for such apps is typically higher. Thus, it might be difficult to convince users about the worth of your application. For that reason, consider implementing free trials, letting users test the product before purchasing. A 30-day money-back guarantee can also help make people more comfortable giving your app a go.
White-label solutions
Your application can become the foundation for many new products instead of relying on individual users. Offering a white-label solution means you provide clients with a functional application they can customize based on their needs. Of course, your clientele is different in this case. Companies are usually interested in such products for their businesses.
Donations
Donations might not be a stable option for keeping an application running (and seeing profits yourself). However, if you offer a free or freemium product, you can encourage your community to donate. In that case, you can sustain the application as free or avoid raising prices to the premium version.
Conclusion
Finding the right way to monetize your product is crucial. You should address potential customers’ expectations and meet them halfway. For instance, you can rely on the classic options, such as ads, but surprise them with the option of paying with their unused internet bandwidth. Of course, proper monetization is only one element of turning your product into a success. Thus, follow other recommendations, such as marketing your product and delivering an excellent user experience.
