Are you struggling to figure out how to get your app to actually show a profit?
Have you been banging your head against the wall, trying to figure out how to make your freemium or paid app generate sustainable revenue?
In this article, we feel your pain. We’ve examined dozens upon dozens of strategies for monetizing apps, so we’ll take a look at 10 killer mobile app monetization strategies that are actually proven to work and generate a solid profit.
The App Economy
In spite of the overwhelming volume of titles hitting the app stores every day, only a small island of entries in this sea of apps actually makes a profit by selling. According to a recent Gartner study shows that a whopping 93 percent of mobile apps are expected to be free by the end of 2016. This shows the need for mobile app monetization to consider in-app revenues more seriously than the price tag for app store downloads.
On the other hand, the majority of paid apps fail to attract enough users to claim a profit. So, selling the app is just a point blank strategy that may or may not work. There are actually lot of other aspects to monetizing an app than just selling it for a subscription fee. Consider these aspects before moving on to the monetization strategies that can actually work for you.
- A mix of both paid app and free app can be better than sticking with either of them.
- A subscription model alone cannot guarantee your success; there are other considerations.
- You should always plan a monetization strategy that keeps the actual and potential users in mind.
- Just as all apps are different along with their target audience and competition, your monetization strategy should also vary.
- Finally, any monetization move takes time to mature with acquisition, engagement and building reputation. This means you should not expect a quick success.
With that said, let’s move on to the 10 killer mobile app monetization strategies that actually work.
1. Upgrade to premium
Most apps find this good for a smooth transition from creating a user base and then upgrading them to the premium one for a fee. This approach, also known as the “freemium” model, is effective as long as the free app version holds the interest of the audience and make them engaged.
For example, offering gamers the opportunity to play the first few levels for free can intrigue them enough to upgrade to premium for an in-app purchase or subscription. In much the same way, a music or movie download app can allow users to retrieve a certain number of songs or films, demanding a subscription thereafter for unlimited downloads.
2. Virtual currency
Many of the most successful apps utilize virtual currency successfully as a revenue model. Particularly in immersive gaming apps, virtual currency makes a common appearance. The idea behind this is to offer a currency that can be earned by playing more, competing and achieving special advertisement offers or through buying something. The players then utilize the earned currency to unlock features or items of choice.
3. Native advertisements
Native ads allow app builders to generate revenue while providing the least invasive interruption to the user experience. These ads actually blend in with your app’s visuals and other elements, and they don’t affect the user’s ability to use the app. It takes just a little bit of work in design and development to include native advertisements within the app, garnering easy visibility and better click-through rates. Moreover, these ads are flexible, adaptive and can fit perfectly into any kind of app.
4. Pushing the newsletter
If your app has a newsletter, you can utilize it for a monetization drive. You can push the newsletter through your app to garner more registrations and consequent leads. This is also a robust way to drive traffic to your website from within the app.
If your app is just another face of your brand, then there is nothing wrong with such a move. If the app cannot generate enough revenue to survive on its own, it can at least help the other leg of your brand by adding more value.
5. Earn incentives from advertisers
You can allow brands to display their advertisements within your app, or just allow them to address some promotional campaigns at your app’s users. Whenever any business converts a lead through the ads, or anyone earns revenue from the campaign, you earn an incentive as an affiliate, because of your ownership of the app generating the conversions or revenue. This revenue model is particularly effective in gaming apps, as players frequently choose to redeem gifts and respond to such integrated campaigns. Some affiliate programs that are helpful in monetizing apps include SupersonicAds, Klip, and the like.
6. In-app purchase
Much maligned, the in-app purchase is still one of the most popular and effective monetization strategies, especially for free apps. Unlike so-called ads and banners, this method offers the least interference to the ease of use of the app, while also offering the least negative impact to the user experience. Just by making small purchase in the course of playing a game, a player can unlock an array of game features or useful objects. Game apps or any kind of app that offers an immersive experience, making users glued to the app for hours, can effectively utilize this strategy.
7. SMS marketing
The same device on which your game app is being played by the user holds the most crucial customer information: his or her cell phone number, email address and social media profiles. Just by asking your users for their mobile numbers, you can generate an outstanding contact list to be used for SMS marketing.
Once you get the mobile numbers of your users, you can send them contextual messages showcasing an event or promotion or informing them about a new product or contest.
8. User analytics for retention
Most apps are abandoned within the very first week of the download and never used again. Therefore, user acquisition cannot help you garner profit and earn revenue as long you fail to retain those users. Ensuring regular engagement of your users is the mission-critical step to accomplish this.
Unfortunately, without an in-depth understanding of your users’ behavior, their buying patterns, demographic data, and user contexts, you have practically no clue to improve retention.
This is where data analytics tools can really be effective. They offer you periodic guidance concerning the areas that you need to address to make your app more engagement-friendly, which leads to increasing your user retention rates and, by extension, your revenues. Some popular and effective app analytics tools include Apple App Analytics and Google Analytics for Mobile Apps.
9. Partnership with another successful app
Partnering with another successful app and using the promotional benefit from their platform is a great way to build your user acquisition and achieve revenue growth. Even if you cannot partner with a hugely successful app, doing the same with a moderately successful or a potential one can be effective as well. The recent partnership between Evernote and LinkedIn’s social platform is an excellent example, as the synergetic integration between the two services increased the popularity of both.
10. Multiple options of payment
The old marketing mantra of avoiding blind lanes and instead offering several options is at work here. Just one payment option is like the blind option with the possibility of garnering a strictly negative or positive response.
On the other hand, multiple payment options offer an array of choices, and users are more likely to choose one. For example, a newspaper or news app can offer its readers several subscription options, such as a web subscription, print subscription, mobile app subscription or a combination of choices.
Make that app pay for itself
Any of these 10 monetization strategies could be right for you and your app, but you have to do a bit of research to figure out which is the most synergetic choice for your circumstances. Are there other seemingly surefire ways you’ve found to monetize your apps? Let us know in the comments.