Planning to develop a mobile app to make your business grow? There are millions of apps in the App store, and majority of them are free. How can you plan an effective app monetization strategy? Going after the revenue from the paid version of the app is of course not a good idea as it can put you at risk. If you put a price tag on your app, the users are likely to look for other alternatives that are available for free.
Free apps are likely to have more installs, but one needs to be smart enough to monetize the app. Here are some common models for planning effective app monetization strategies:
1. In-app advertising:
In the app, mobile ads appear because they allow the app owners monetize the app without asking the users directly. You would be able to create a stable and large user base and this would also help you gather relevant information about the users. As the app would be completely free, you can easily find new customers and retain the existing ones.
Ads are surely a smart choice when placed in the apps because they do not distract the users from the user experience. In-app advertising should be done in a highly-targeted and personalized way to keep the users attracted to the latest offers. Make sure that you don’t overrun your native app value. This model can help you collect preference data about the users.
A freemium app is offered for free. The users can get access to the basic functionality and users, but if they want to access all the features, they would have to pay the charges. The main aim of the app is to accumulate and engage the app users until they get ready to pay for accessing the additional in-app tools.
3. In-app purchases:
This model focuses on converting your app into a sales channel. It can help you make considerate amount of profits without any risks. One can sell virtual goods like in-game currency or extra lives. Most of the dating apps such this model wherein the app allows the users to browse through the profiles and chat with the other members, but if you want to enhance your visibility and interact with more people, you can use the credits. Retail or services apps can have such a functionality.
Sponsorships are the newest ways for app monetization. You can partner with the advertisers who offer rewards to your users when they complete certain actions within your app. On the other hand, your app can earn money by taking a share of the revenue for the redeemed rewards. This model can be incorporated in almost any vertical.
Finding the right model for app monetization is very important. You should access your goals and improve the business outcome gradually.