Feb 21 · read
In a hurry? Here’s the most valuable info you should get from this article. Proven mobile and web app monetization trends:
-In-Apps Advertising — old but gold;
-Sponsors and Partnerships;
-Freemium First, Premium Second;
-Data Monetization (build a strong audience base);
From our experience in working with million-dollar startups, monetization is a key factor to have in mind when developing mobile and web apps. Remember the times when the app market was unsaturated, taking an app on the path of success was a child’s play and users were not bombed with endless alternatives for a single app? Let’s take a moment of silence for these times are long gone.
Your app may be the core of your business or just tech extension of it. Either way, a right app monetization strategy will assure that your app generates revenue/ it is a profitable business and that you have the resources to maintain the app in the future. Sometimes it’s a hidden cost dressed in an iceberg costume. Talking in the scalability terms, once your product hits an influx of traffic and it serves a multi-digits number of users, it has to easily be adapted to a bigger load of work.
Catchy? Useful? Innovative? If you are building an app yourself, you are privileged to associate it with whatever adjectives you can imagine. But for the sake of business, make it profitable.
In an era where apps are expected to be free, there are several ways to keep those revenue streams coming. Most of the apps have figured out how to incorporate a combination of multiple monetization strategies, without influencing the performance. From this point on, your job will be to weigh the options and take notes on which ones are suitable for your mobile and web app.
1. In-App Advertising;
This strategy is a pioneer in the book with revenue sources, but it must be well-balanced because if it’s applied poorly it may lead to negative effects. The worst scenario is having bad reviews, decreased loyalty and the “Delete App” button pushed too many times. And you don’t want that. Think of the ratio of advertisements, where they appear, and how users interact with them. Shortly, make the in-apps responsive to the audience’s needs and interests, rather than spamming with irrelevant offers and popping banners.
Types of In-App ads we recommend to use in 2019: banner Ads, interstitial ads, video ads, rewarded video ads, rich media ads.
2. Sponsors and Partnerships;
It’s one of those situations we like to call “win-win”- when you get sponsored with an amount of money for entitling someone publicly as your sponsor and them getting the visibility. This works when you are likely to address the same audience and your app has enough traffic.
This can be put into practice by adding in-app push notifications, mentioning the name of your sponsor’s name, providing for them in-app based-location offers and deals.
3. In-App Purchases;
The evolution of revenue in million US dollars for the In-App purchases according to Statista
This is one of the most used types of monetization at this hour and as you see it’s growing steadily from day one until this very moment.
Basically, this is a way of saying “Here’s the app. Go use it and see how great it is. Do you want more? Please be willing to pay.” By letting the user engage first with your app, you already create a bridge of trust based on the quality you showcase. Once you have them, you can win them over.
The stats for the last years say that almost 50% of the total app revenue is due to in-app purchases.
In-app purchases may refer to either buying subscriptions or additional content.
Subscriptions can refer to newspaper subscription, unlimited use, fixed price subscriptions, pay as you go. You can make them non-renewing or auto-renewable. Another card you can play is one-time consumable purchases which can be added through offering lives, hints, currency.
On the other hand, there’re non-consumables like ‘upgrade to pro’, removing ads, extra characters, full unlock.
4. Freemium First, Premium Second;
Unlock some extra features here.
Not sure whether this strategy works? If a free T-Shirt makes wonders, be sure that this does too.
Imagine you have two versions of your app. The first one has the basics that are enough to make the user “addicted” to what you’re offering but in order to get the full experience and the more elaborate specs he needs to invest a little bit.
5. Data Monetization (build a strong audience base);
2019 will be all about the user becoming aware of how things work and how their experience can be improved through personalization. This means building a strong audience base and collecting information about behaviors and adding value on the go.
We are talking here about a mature thinking user who understands the reason why the app is free and the perks he gets once the data he provided indirectly is being processed. It’s like letting a professional tailor sew the costume on you.
Why is data monetization so appealing? It’s secure and it gains more popularity. The user is neither disturbed and interrupted nor forced to pay for every move in the app. As a result, you get to monetize a much bigger pool of users and things will improve even more with the evolving technology.
The logical course of the events is simple and based on 3 steps: engagement, retention, and monetization. In order to get profit from your user, you must create a desirable and almost addicting experience that ultimately will turn into profit. So, what’s the secret? First, build a flawless app with your target audience’s needs in mind and then choose a suitable monetization approach for your product.
What kind of app are you going to launch?
Reach out to Wolfpack Digital — a top development agency that has worked with million-dollar startups to help you build the flawless app.