App Monetization Archives - BuildFire

The Ultimate Guide to Mobile App Monetization

Having an idea and turning that idea into something profitable are two very different things. Lots of people want to create an app, but the money-making aspect holds them back. Will you ever see a return on your investment?

I get asked dozens of questions about apps on a daily basis. But “how do you make money with an app” is definitely at the top of the list—which inspired me to create this guide.

Fortunately, there are lots of different ways to monetize an app.

Whether you’re building a new app for the first time or trying to make money with your existing app, I’ll explain everything you need to know about app monetization below.

How to Make Money With an App

Generally speaking, app monetization strategies fall into one of two categories—direct monetization and indirect monetization.

Direct monetization is definitely the most popular. In fact, the vast majority of the app monetization models covered in this guide will fall into that bucket. But before we get into the specifics, I want to quickly clarify the difference between these two app monetization methods.

Direct Monetization

As the name implies, direct monetization is money generated straight from your app.

If an iOS or Android user pays $1 to download your app from the Apple App Store or Google Play Store, the cash comes directly from the app. When someone uses your ecommerce app to buy something from your business, the sale is coming from your app.

Again, this is pretty self-explanatory. But it’s essential to understand how direct monetization works before we dive into indirect monetization.

Indirect Monetization

Indirect monetization isn’t quite as black and white. You can still make money by creating an app, but the actual dollar amount can’t necessarily be tied to the app itself.

The best example of indirect monetization is a standalone product or service that comes with a free app. In this situation, the app is secondary. You’re making money whether the app gets used or not. Having an app makes the product more appealing to prospective customers since it will ultimately improve the user experience.

Indirect monetization is extremely popular for software products. I’ll give you some actual examples of this shortly as we talk about app monetization strategies in greater depth below.

6 App Monetization Models and Strategies

There are six different ways to make money with an app. I’ll explain each one’s advantages and drawbacks to help you figure out the best way to monetize your app.

You’ll also see some real-life examples of apps using these monetization models successfully.

1. Paid Downloads

Charging users a fee to download the app is one of the simplest ways to make money with an app.

So how much should you charge? According to a 2020 study from Statista, the majority of paid apps cost less than $1.

As you can see from the graph, most paid apps cost less than $5. This particular study only used data from the Google Play Store.

Statista also determined that the average cost of a paid app in the Apple App Store was $4.37. While this is slightly higher than the distribution of paid apps in the Google Play Store, it still falls in the less than $5 range.

You have the freedom to charge whatever you want for your app. But if you’re going to charge users a download fee, it should be in the range that they’re used to paying.

While pay-to-download is definitely a straightforward app monetization model, it does have its drawbacks. You can’t expect to get nearly as many downloads as you would for a free app. Some people won’t consider installing an app if it’s not free.

With that said, it’s more likely that paid users will be highly engaged.

Anyone who pays for a download will want to get the most out of their investment. If those people are using the app frequently, you could potentially make even more money from them with other app monetization models on our list.

2. In-App Purchases

The in-app purchases monetization model can be used for both free and paid apps alike. You can use this method for physical and virtual products.

Gaming apps love to leverage the in-app purchase methodology for virtual coins or experience upgrades. For example, users playing a mobile gaming app could spend money to unlock a new vehicle, weapon, map, or something along those lines.

Pokemon Go is a great example of a free mobile app that makes money from in-app purchases.

According to Video Games Stats, Pokemon Go has generated more than $3 billion in revenue as a free app.

This revenue comes from roughly one billion downloads. But since people aren’t paying to download the app, how does it make money? In-app purchases. The app sells “PokeCoins.” This virtual currency can be used to pay for upgrades within the app that improve the gaming experience.

But mobile games aren’t the only way to monetize an app with in-app purchases. Ecommerce websites can build an app as a way to increase mobile sales.

If a customer buys a shirt, pair of sneakers, book, watch, or whatever you’re selling online from your app, it falls into this category as well. Using an app to make money is a no-brainer for anyone who already sells physical or digital products online.

3. Subscriptions

Subscriptions are an excellent way to generate recurring revenue with an app. The Apple App Store and Google Play Store both make it easy for you to set up a subscription business model with your app.

Users only need to sign up for a subscription once, and they’ll continue to get charged on a recurring basis until they manually cancel the subscription.

In most cases, subscription apps are billed on a monthly basis. But you can set up annual or quarterly billing cycles as well. It’s common to offer a better monthly rate for longer subscription terms, as shown in the example above.

Subscription apps could be applied to a wide range of industries and potential use cases.

If you’re creating a fitness app, you can charge users a monthly subscription for access to workouts, videos, and training regimens. Even a small business owner, like a local dry cleaner, could leverage the subscription model to offer pick-up and delivery cleaning services.

An excellent subscription-based app, called PepTalks, was recently built using BuildFire’s platform. App users pay a monthly fee to receive motivational words delivered to their devices via push notification on a daily basis. You can read the full PepTalks customer story here to learn how one person took a simple idea and monetized it with an app.

4. Freemium Model

The freemium app model is essentially a mix between subscriptions and in-app purchases. Technically speaking, it could potentially fall into either category, but this is definitely worth mentioning on his own.

To clarify, the term “freemium” comes from combining the words “free” and “premium.” Free + premium = freemium; get it?

So offering your app for free is the first step to using the freemium monetization strategy. Next, you need to offer different versions of your app—free and premium.

The idea here is to offer a free version with basic features and an upgraded version that delivers a better user experience. For example, let’s look at the Pandora mobile app subscription options.

This Internet radio service has multiple plans, including a free version.

Anyone can download the app for free and listen to music for free. However, you’ll be interrupted with ads between songs. There are also some limitations and contingencies in terms of skipping songs, searching for songs, and playing what you want.

The free version is fine, but if you want to get the most out of this app, you’ll need to get a paid subscription.

With freemium apps, you still need to make the free version good enough. For example, if the free version of Pandora only played one minute of each song, nobody would use it. So you’d have a tough time converting those free users to paid subscribers.

You’ll also need to make sure the cost associated with the premium features are justified. If the only difference between the two versions is a minor inconvenience, people won’t feel the need to upgrade.

Another way to entice premium upgrades is by offering extended free trials of those versions. Some users might not know what they’re missing until they try it out. So don’t be afraid to offer a premium month for free.

5. Advertisements

Ad revenue is an extremely popular app monetization strategy. With this method, you’re selling space within your app for advertisements. Some of you might be familiar with this model if you display ads on your website.

According to a recent survey of the world’s top app publishers, mobile advertising is the most effective method of app monetization.

As you can see from the chart, 8 of the top 12 methods on the list are ads—including 4 of the top 5.

App advertising can come in all different shapes and sizes. Not only are there different types of ad formats (video ads, banner ads, native ads, pop-ups, interstitial ads, etc.), but there are also different revenue models within this category:

  • CPC (cost-per-click)
  • CPI (cost-per-install)
  • CPA (cost-per-action)
  • CPM (cost-per-mile)
  • CPV (cost-per-view)

How you’re paid and how much you get paid depends on a wide range of factors. For example, simply displaying a banner ad with a CPV revenue model usually won’t pay as much as CPC or CPI model.

Check out our guide on the top mobile ad networks to help facilitate ads within your app. This resource contains an in-depth description of the various revenue models as well. Ad networks help ensure the ads displayed within your app are relevant to your target audience.

While in-app advertisements are popular and profitable, they’re definitely not for everyone. Sometimes ads can hinder the user experience, and ultimately make your app less desirable. So you need to take this into consideration before blindly adding ads to your app.

6. Product Extensions

A product extension falls into the indirect monetization category, which I mentioned earlier.

This strategy is a great way to generate revenue for your product, service, or business, but the money won’t be tied directly to actions within the app itself. Let me give you an example to explain what I mean.

Take a product like QuickBooks. For those of you who aren’t familiar with this name, QuickBooks is an online accounting software used by 7+ million customers worldwide. The platform controls more than 50% of the accounting software market share, which is why it makes such a great example.

QuickBooks is a paid software. But anyone who buys the software gets to use the iOS and Android mobile app for free.

The app itself doesn’t directly generate any revenue. You can sign up for a QuickBooks subscription and never use the app.

However, people love apps. Being able to access the software from anywhere with a native mobile experience adds value to the product.

Having an app as a product extension also helps differentiate you from the competition. If your product comes with an app and others don’t, then it gives you a significant edge. Your business will automatically be more appealing to consumers who are shopping around for a product in your category.

How Do Free Apps Make Money?

If you don’t want to charge users for downloads, you might be wondering how to make money with a free app. Don’t panic—you can still make lots of money without charging for app installations.

Refer back to the app monetization strategies we discussed above; five of the six methods can be applied to free apps.

  • In-app purchases
  • Subscriptions
  • Freemium apps
  • Advertisements
  • Product extensions

All of these monetization models can be leveraged with a free app. You could even use more than one method for your free app.

For example, let’s say you plan to use the in-app purchases monetization strategy. You can leverage advertisements as well. Using multiple monetization methods will help you make money with a free app.

The vast majority of app installations from the Apple App Store and Google Play store are free downloads.

Furthermore, 98% of global app revenue comes from free apps. Check out our extensive guide on mobile app download and usage statistics for other relevant facts like this.

In short, don’t feel pressured to charge for app downloads—you can still make money with a free app.

How to Choose the Right Monetization Model For Your App

With so many app monetization methods to choose from, how can you decide which method is best for your mobile application?

There’s no single answer to this question. You’ll have to weigh the pros and cons that we’ve discussed above.

Some industries and app types are easier to determine than others. For example, in-app purchases would be the obvious monetization model for an ecommerce app. Using ads for an ecommerce app or charging for downloads probably won’t be the best idea. Ads can take attention away from the products you’re selling, and making users pay extra for the ability to buy products through the app doesn’t make a ton of sense either.

Depending on your app type, you could experiment with different monetization models. Let the data do the talking for you—track engagement and other valuable KPIs to figure out which method will be the most profitable for your app.

Do I Need to Monetize My App?

In most cases—yes.

Without a monetization strategy, your app won’t make any money. You’ll want to make sure you can recoup the cost for app development, and eventually turn a profit for your efforts.

But with that said, not every app needs to be monetized. Some apps can make money without an actual monetization strategy. For example, let’s say you build an internal workforce app. An HR mobile app or an employee communication app doesn’t need to be monetized.

You wouldn’t charge your employees to download an app or interrupt their experience with advertisements. But building an app for these purposes can ultimately save money in labor and productivity costs. Your profit total profit margins will increase elsewhere, even though the app itself won’t directly drive revenue.


App monetization can be a challenge for app developers and business owners. But making money with an app doesn’t need to be complicated.

The first step is understanding the different ways to make money with an app. Then it’s just a matter of figuring out which ones work for you.

This guide covers everything you need to know about app monetization. So use it as a resource as you’re going through the process.

The Comprehensive Guide To Business Growth Through Mobile Apps

There used to be a time when building a mobile app was only feasible for big players and industry giants. Those days are over.

Today, it’s become much easier and accessible for smaller companies to build an app for their business.

Mobile usage has seemingly taken over our lives. People in the United States spend 5 hours per day on their mobile devices.

92% of those hours are spent on mobile apps, while just 8% is on web browsers.

This means that it will take more than just a mobile-friendly website for your company to have an effective mobile strategy. Businesses are realizing this, and acting accordingly.

In fact, 42% of small businesses already have a mobile app. An additional 30% of small business owners plan to build an app in the future.

There are more than 1.9 billion websites compared to 3.4 million unique mobile apps. By successfully launching an app for your business, you can still have an advantage over your competitors as an early adapter. Continue reading “The Comprehensive Guide To Business Growth Through Mobile Apps”

Boost Your In-App Purchases

Think back to the reason why you built a mobile app in the first place.

I know, this may seem like it was an eternity ago. You’ve gone through quite the experience since the idea to build an app first popped into your head.

Sure, developing an app is cool, but the reason why you built an app was to make money.

Is this going how you initially planned? Whether your app is doing well, struggling, or plateauing, everyone could always use more money.

But if you think that you’ve exhausted all of your marketing tactics and your sales are still stagnant, you may need some help.

Fortunately, you’ve come to the right place. As a qualified expert in the mobile app industry, I know what it takes for an app to be successful. I can offer you some solutions to get you going in the right direction.

I’ll show you exactly what needs to be done to help you increase your in-app purchases. As a result, you’ll have a mobile app that’s a money-making machine.

Here’s what you need to do.

Continue reading “Boost Your In-App Purchases”

7 Ways to Increase Customer Mobile App Spending

Today, there is so much competition out there in every industry. Your company is competing with local, regional, national, and global giants.

One of the best ways for you to survive, thrive, and gain a competitive edge is to get your customers to spend more money.

It’s a simple concept that I’m sure you can agree with. But are you actively taking steps to make this happen?

If you’ve got a mobile platform, you’re already headed in the right direction. It’s clear that mobile trends are on the rise. You need to adapt right away if you want to stand a chance in the future.

Now that you’ve got an app, you’ve just got to learn how to take that app and turn it into dollars.

Take a look at the total mobile app revenue from a global perspective over the last two years.

global app revenue 1

From 2016 to 2017 we saw a 35% increase. So it’s clear that consumers as a whole are willing to spend money via mobile apps.

To make sure that your app is successful and profitable, it all comes down to understanding your customers. You’ve got to figure out what they want and how they want it.

They’re using smartphones and tablets to spend, so take advantage of that.

As an industry expert who has helped businesses thrive when it comes to customer spending, I want to share my insight with you.

I’ve identified the top 7 ways for you to increase customer spending through your mobile app. Here they are.

Continue reading “7 Ways to Increase Customer Mobile App Spending”

Make Money Like These 8 Business Giants With Geofencing

As a business owner, you’ve got to constantly come up with new ways to make money.

This statement holds true for every company throughout all industries. Just because your business model is sustainable right now, it doesn’t mean that it will be in the years to come.

You need to stay educated on industry trends and learn about new forms of technology to help your business grow.

One of the ways that you can make more money for your business is through geofencing. Have you heard of this? Are you familiar with how it works?

For those of you with a mobile application, you definitely need to be using geofencing.

There’s no need to reinvent the wheel. If you’re not sure how something works or how to apply it to your company, your best bet is to follow the lead of those who succeeded before you.

I’m going to show you some examples of well-known companies that use geofencing to improve their business model and turn a hefty profit.

For those of you that don’t know what geofencing is, I’ll also explain the basic concepts of how it works. That way you’ll be able to use this guide as a reference for when you apply geofencing to your business and mobile application.

Here’s what you need to know.

Continue reading “Make Money Like These 8 Business Giants With Geofencing”

How Much Money Can You Make with a Mobile App

There are billions of dollars in the mobile app industry.

So it’s safe to say that there is definitely plenty of money to be made. This is encouraging news if you currently have a mobile app or if you’re thinking about building your first app.

How much money will you make?

Well, the answer to this question greatly depends on a lot of different variables. Your app may not make a billion dollars, but you can access a piece of that pie and still turn a hefty profit.

In order to do so, the first step is mobile app development.

For those of you who already have one, that’s great; you’ve got a head start. Just because your existing app isn’t making money hand over fist, it doesn’t mean that it’s too late to make adjustments.

One of the factors that impacts your revenue is whether you develop for the Google Play Store or Apple App Store.

It also depends on your monetization strategy. There are three main ways that mobile apps can make money.

  • subscriptions
  • in-app purchases
  • advertisements

You’ll also have to take into consideration that mobile apps aren’t just for phones anymore. There is an emerging market for additional devices.

In this guide, I’ll cover all of these topics in greater detail. This will give you a much better understanding of how to make money from your existing mobile app or with an app development idea.

Here’s what you need to know.

Become a Buildfire White Label Reseller and make money building mobile apps for your clients


Continue reading “How Much Money Can You Make with a Mobile App”

How to Increase Your Mobile App Revenue With Auto Renewable Subscription in IOS

Coming up with new ways to generate money for your mobile app can be tricky.

Before you started to develop your app, I’m sure you came up with a plan for your company to make money.

Well, not everything always goes according to plan.

Some of you may be in a position where you need to find another income stream outside of your in-app purchases or advertisements.

Even if you’re currently running a successful app that’s profitable, you should be ambitious and try to squeeze every dollar you can out of your business.

Auto renewable subscriptions are a great way to generate revenue, regardless of your current situation.

This could even be a strategy for those of you who are still in the pre-launch stages of development and you’re brainstorming monetization strategies before your app goes live.

But if you’ve never done this before, it may seem intimidating.

You’ve heard of auto renewable subscriptions and have a basic understanding of how they work, however, you’re not quite sure where to get started.

Well, you’re in luck.

I can provide you with the resources and advice to help you implement this strategy to your mobile app on the iOS platform.

Let’s start with the basics.

Think of an auto renewable subscription like a membership.

Apple users can review their subscriptions in the “Account Settings” on their devices.

review subscriptions

Do you go to the gym? If so, you’re probably paying a monthly fee that’s automatically charged to your credit card.

The same concept applies here.

Rather than the customer having to complete a transaction every month, quarter, year (or whenever timeline you’re on), they get billed automatically.

That’s why this is so appealing to mobile app operators.

Really, you only have to get someone to sign up once.

After that, you collect money until the customer cancels their subscription, which hopefully doesn’t happen.

As long as your app is running efficiently and you prioritize the user experience, your customers shouldn’t cancel.

With that said, Apple makes it hard for businesses to run subscriptions on their platform, whether they are auto renewable or otherwise.

Here’s what you need to know before you dive in.

Continue reading “How to Increase Your Mobile App Revenue With Auto Renewable Subscription in IOS”

How do Free Apps Make Money?

Once the app development process is completed, you’ve got to make a crucial decision before you make it available on the Apple App Store or Google Play Store.

Are you going to charge users to download it?

Or will you make it available for free?

One of the reasons why so many people decide to charge for downloads is because they don’t know any other way to generate money for the app.

After spending so much money on development, they think the only way to get a return on the large investment is by charging a fee per download.

This is a common misconception.

Free apps can generate real money.

That’s right.

You’ve just got to make sure you take a smart approach to this strategy.

There are lots of big players out there who are making lots of money. You can achieve this similar success as well if you follow a few very important monetization strategies.

  • Understand the users
  • Understand the competition
  • In-app purchases and advertisements
  • The art of subtlety

So if you’re up in the air about whether or not offer your app for free, I’d say that free is definitely your best option.

All you need to do is follow these tips, which I’ll outline in greater detail as we continue.

The majority of apps that get downloaded are free.

majority free

What does this information tell you?

Mobile users are not used to paying for their apps.

So it’s unlikely they’ll make an exception for yours.

I’m sure there’s something similar that’s available on the market, so they could just get it for free somewhere else.

So your best choice is to offer or it without charging anything. Then try to get as many downloads as possible and look to other options for revenue streams.

As an industry expert who has been through this before, I can tell you from personal experience that it works.

Free apps make money and here’s how yours can be profitable too.

Continue reading “How do Free Apps Make Money?”

How to Generate Your First $1,000 For Your Mobile App

Building your mobile app has been quite the journey.

I know from experience that this process has ups and downs.

It’s such an accomplishing feeling once you’re done – so congratulations.

But the journey isn’t quite over yet.

Now that the app is completed and approved by the App Store, it’s time for you to start making money.

That’s the whole reason you started this in the first place, right?

Somewhere along the way, hopefully, you haven’t forgotten your initial revenue generating strategies.

Or maybe those methods aren’t working.

Regardless of your situation, I can help you out.

As an expert in this industry, I can show you the best ways to make money with your mobile app.

Sometimes it feels like the first $1,000 is the hardest, but it doesn’t need to be.

Once you hit that milestone, it will give you the confidence to know that your app actually works.

Getting downloads that translate to dollar signs will reinforce that it was it was worth it to build an app for your business.

Let’s jump right into it.

Continue reading “How to Generate Your First $1,000 For Your Mobile App”

What Type of Apps Make The Most Money [A Data Driven Answer]

Anyone can come up with an idea.

With so many mobile applications available on the App Store and Google Play Store, it seems like everyone is putting those ideas to use.

But how many of those apps are actually making money?

Before you go through the long and often expensive process of learning how to code and developing an app, you need to sit down and come up with a plan.

Is it worth it build an app for your business?

Depending on which type of app you’re planning to create, the answer may vary.

Different types of apps have more success than others.

First, you’ve got to segment yourself into one of two categories.

  1. You’re building an app as an extension of your existing brand or business.
  2. You have an idea for the next great mobile app (like Snapchat, Instagram, or Tinder).

If you fall somewhere within the first option, your app would be used to improve the experience for your existing customers.

As you continue to cater toward the wants and needs of your customer, you’ll see an increased revenue stream.

Mobile apps are also a great way to acquire new customers, which also generates more money.

That’s especially true if you’re an ecommerce business. Look how many mobile shoppers there are in the United States alone.

mobile shoppers

There’s plenty of room for you to succeed if you think your app would be the next big hit as well.

That may be a more difficult road, but it could potentially be a home run if you’re successful.

You’ve got to understand the breakdown of your revenue.

How will you actually generate a profit?

  • Subscriptions
  • In-app purchases

Those are the most common options for you to choose from.

Another business concept that you’ll need to grasp is the difference between profit and revenue.

It’s possible for your app to have a high revenue without generating any profits.

In fact, you could end up with a net loss.

Here’s what I mean.

Let’s say your app makes money through in-app purchases.

You generate $5,000 per month, so your annual revenue is $60,000.

But if it costs you $56,000 to run and operate the app, your profit is only $4,000 for the entire year.

Don’t get me wrong, that’s better than being in the red.

But I see this all too often when I’m consulting for different companies. They get so focused in on their revenue, that they don’t realize their profits are so low.

The basic formula to determine profit is by subtracting your total costs from the total revenue.

As an industry expert, I’ll explain to you which types of apps make the most money so your company can be profitable.

Here’s what you need to know.

Continue reading “What Type of Apps Make The Most Money [A Data Driven Answer]”

How to Build a Mobile App That Actually Makes Money

Why do you want to build an app?

Mobile applications are a great way for business owners to make improvements to their company.

They are also the perfect platform if you think that your idea will be the next big hit, like Instagram or Snapchat.

Regardless of your reason for creating an app, I’m sure you have something in common with other prospective developers.

All of you want to make money.

First of all, I commend you for doing the research before you get started building your first app.

I’ve seen so many people who were naive enough to think that just because they created an app, it would automatically generate money. That’s not true.

Here’s an analogy. If you start a new business, will it automatically make money. Absolutely not.

With mobile app development and other businesses alike, it all starts with an effective monetization strategy. Not sure where to begin?

Fortunately, you’ve come to the right place. As an expert in the mobile application industry, I have the knowledge and experience to help steer you in the right direction.

Build a profitable mobile app in less time and at a lower cost than traditional solutions with BuildFire


App Monetization Strategy

90% of time spent on mobile devices is in apps.

Consumers clearly love to use apps, so the opportunity is there.

The key is finding out how to choose the perfect app that will peak user interest and ultimately get downloads.

But you need to realize that downloads alone don’t always directly translate to dollars.

Building an app is expensive, and you’ll come across hidden development costs along the way.

So before you dump all of your money into your new app idea, you’ve got to make sure it will generate a profit.

Here’s what you need to know.

Continue reading “How to Build a Mobile App That Actually Makes Money”

App Monetization 101

Tools like Buildfire make it easy and relatively painless to create a mobile app; even small businesses are racing to compete in the mobile app sphere. But creating the app is just the beginning; even if you created your app to function as another mobile marketing channel, you still want to recoup your costs and turn it into a solid source of revenue for your business.

Monetizing an app isn’t as easy as building it, unfortunately. Statistically speaking, about 2 percent of app developers are claiming over 50 percent of all app-driven revenues, and about 25 percent make nothing at all from their apps.

And…even though Candy Crush generates nearly $1 million a day in revenues, most mobile apps will be lucky to recoup their development costs, let alone become reliable revenue streams for their developers.

But that shouldn’t keep you from trying different models and techniques to monetize your app. Even if your app is achieving all your marketing goals, it’s always a good idea to try to turn a profit—and there are many paths to profitability for the savvy mobile marketer. Let’s take a look at the six most popular business models to monetize your mobile app.

How Do You Know Which Business Model to Choose?

Before we jump into the six main monetization models for your app, it’s a good idea for you to keep a few questions in mind, because they’ll help you weigh the pros and cons of each model as they apply to your app. It’s a good idea to settle on your monetization model before you actually build and launch your app, especially if you plan to use some form of in-app advertising.

Of course, your choice isn’t carved in stone; you always have the option to mix it up or add elements of other models as you see what works with your app.

Here are the questions to ponder:

➤What is your app’s value proposition? What problem will it solve for your customers/users?

➤Are there features and benefits users would pay to access? 

➤What models are competing apps in your niche using? Are they successful?

➤What is more important to you right after you launch your app: Attracting more users or immediately generating revenue?

These aren’t mutually exclusive necessarily, but some approaches are geared toward getting the most downloads post launch with revenue coming later, while others are geared toward achieving a revenue stream right off the bat. You need to decide what your timetable will be and what you will prioritize in your monetization model. Can you afford to wait to profit off your app? If so, how long?

App Monetization Models

1. Paid Apps

This method is pretty straightforward; you charge users a fee to download your app from Google Play or the App Store. You might think this is the quickest way to turning a profit and recouping your app developing and hosting costs, but you’d probably be wrong.

Consider this: Only 20 percent of paid apps get over 100 downloads, according to a study by Cambridge University last year. Even worse, only 0.2 percent achieved 10,000 downloads. On the other hand, over 20 percent of free apps reach the 10,000 download milestone.

So unless your app is astonishingly successful and beats all odds, your chances of recouping your costs, let alone achieving a reliable revenue stream, are pretty low, especially if your app is priced in the most common range ($0.99 to $9.99).

Of course, that’s not to say that you can’t monetize your app using the paid model. In fact, if you’ve created a truly unique and valuable app and done a great job promoting it on the app marketplace with amazing screenshots, descriptions, and plenty of five-star reviews, you can make a good amount of money from your app.


Image courtesy of

The Dark Sky weather app costs $3.99, but it handily competes against popular free weather apps. This is because it offers valuable, unique features that the app’s target audience is willing to pay for. The paid model might work for you if your mobile marketing team is able to convince your audience that the features and benefits you provide are better than competing free versions.


-revenue with every download

-users are typically more engaged with apps they pay for


-competition; it’s hard to beat the odds

-Apple and Google take a cut of the revenue

2. Free with In-App Advertising

Take a look at the free apps on your smartphone right now—chances are, most of them use in-app advertising to generate revenue. In fact, this model is fast becoming the dominant one for app developers. In a nutshell, you offer your app free in order to encourage more downloads and a wider user base.

Once you’ve acquired a stable user base, you collect data about them and use it to sell ad space on your app. You can do this on your own or partner with a mobile ad company.

Basically, you have a few choices for in-app advertising. Some of the most popular types of mobile app ads include:

  • Native ads
  • Interstitial ads
  • Video ads
  • Banner ads

Native ads blend within the content. They don’t interfere with the user’s experience.

Interstitial advertisements are the opposite. These images or videos typically take up the entire screen.

Users have to watch the ad or perform another action before they can continue where they left off.



Basically, you have two choices for in-app advertising: Banner ads and native ads. Facebook and Twitter have mastered the native ad approach within their apps with sponsored and promoted posts, but most consumer apps are better designed for banner ads.

Mobile users, however, won’t stick around long if your banner ads are too intrusive. A recent study by Medialets showed that ad size and placement make a huge difference in conversion rates and how well the advertising is received.


Image courtesy of


-grow your user base faster, free apps are more widely downloaded

-mobile ad spend is a high growth industry; you should be able to sell ad space


-higher churn, users get tired of ads

-not good for important utility apps; intrusive ads interfere with essential functions

3. Freemium

Consider how you’re going to price your app.

Are you going to charge users to download it or will you list it for free?

Keep in mind, the majority of apps offered on the Apple App Store and the Google Play Store are free to download.


There are pros and cons to each method.

If you charge users to download your app, you’ll get revenue up front. People who are willing to pay for mobile apps will likely be more engaged than users who download it for free. It’s unlikely that someone will buy your app and then never use it.

But if the app is free, it’s easier for users to lose interest because they don’t have any monetary investment in the download. With that said, charging just to download your app can potentially turn people away.

Since there are so many apps available on the market, there’s a good chance that users can find something similar for free.

Personally, I’d recommend offering free downloads.

As the name suggests, this is a hybrid monetization model that combines a free app version with basic functionality with gated functions the user must pay to access. The idea is that after customers download and use the basic app features, they will be enticed to want to purchase all the premium features to experience the app’s full functionality.

Many gaming apps are very successful with the freemium model. Rovio, for example, released a free version of the addictive Angry Birds game, which let users play through a few levels and tempted them with hidden features. Once the customers were hooked on the game, it was a small leap to get them to pony up for premium features.

This model requires a delicate balance, however. If your free functionality is skimpy, you’ll wind up with a great deal of churn. Give away too much with the free version, however, and you’ll have trouble setting your premium features.


-easy to implement if your app has advanced levels or features already in it

-“try before you buy” is generally a good business model


-it’s tempting to give your free user base an inferior product

-only works with highly engaged users

4. Subscription

The basic difference between subscription and freemium models is that unlike freemium, where functionality is gated, subscription models place content behind a pay wall. Most subscriptions are recurring and frequently auto renew.

This model doesn’t work well with all verticals, however. It’s best suited to entertainment, lifestyle, and news-type apps, where you can logically wall off content and limit the amount of content consumed (number of videos watched, for example, or number of recipes or meal plans downloaded).

Like their freemium counterpart, subscription apps, which are basically “try before you buy,” do better on the app marketplace in terms of revenue generation. It’s important to make sure that you test your subscription plans to get the right mix of free and paid content, and to give your users a superior on boarding experience.


-lower churn due to engaged users

-regular, ongoing revenue stream due to auto renewals


-curating and/or creating the type of high-quality content your users will pay for

-not appropriate for all verticals

5. In App Purchases



Image via Statista

In-app purchases are the largest source of revenue in free apps; it’s expected to reach nearly $10 billion this year. In-app purchases work with a variety of different verticals, because you aren’t limited to selling virtual goods, such as lives for a character in a game. You can sell just about any physical good, as well, especially if the in-app purchase feels like a logical extension of the app experience.

While this model works well with mCommerce and eCommerce retail stores, in-app purchases of physical goods aren’t restricted to this vertical. Any business can offer branded merchandise through its app, for example.


-low risk/high profit, especially with digital or virtual goods

-flexible enough to support affiliate and partnership programs


-most app marketplaces take a sizable cut from digital and virtual purchases (up to 30 percent) in-app

-safeguards necessary to prevent accidental/unauthorized in-app purchases

How many users have downloaded your app?

Here’s a look at the average in-app purchase for iOS and Android platforms.

Based on this information, if you can get 1,000 users to download your app on the Apple App Store, you’ll get your first $1,000 right there.

Not sure how to go about setting up an in-app purchase? Don’t worry, I’ll show you how.

Basically, it will depend on your industry and what type of app you have.

For example, if you’re an ecommerce store, the in-app purchases will consist of actual products offered by your business. But if you’re not selling anything specific, you’ll have to come up with clever ways to entice purchases.

Let’s use the gaming industry as an example. Mobile games generate the highest profits.

They accomplish this by offering in-app purchases that enhance the user experience.

Let everyone download and play your game for free. But give users the option to purchase certain items that make the gameplay easier for them.

6. Partnerships

If you have a customer base that’s a natural fit for another business, partnering with that business to offer their products or services in your app in exchange for a referral fee can be a simple but lucrative revenue source. It’s important that the other company’s offerings have value for your customers, however, and can be naturally integrated into your app.

Sponsorship is a variation of this monetization model that works especially well with event apps, for example. Businesses partnering with or sponsoring the event can pay to have their content included in the app, up to and including product lists, website link, etc.


-works with any vertical

-usually well received by users since content is relevant and/or valuable


-challenging to find partners whose customer base aligns with your users

-revenue is limited to value of partnership agreement

Blending Models

More app developers are using blended models to achieve their revenue goals. The free version of your app, for example, can include in-app advertising that goes away once a user has upgraded to premium features or content. Paid apps can offer in-app purchases, as well, to enhance monetization. And partnership arrangements can be integrated with all the business models.

Just keep in mind that the best monetization strategies don’t interrupt the natural flow of the app experience and aren’t so intrusive to the user that they lead to churn.

Growth and Re-Engagement

No matter what models you choose to monetize your app, you’ll need to have steady growth in your user base—and you’ll need to keep your users engaged. In mobile gaming, for example, just 2 percent of the most active users generate 90 percent of the app’s revenue, so you’ve got to find ways to keep your big spenders and active users engaged if you want to effectively monetize them. That means continually looking for ways to keep your features and content fresh.

It’s also important to watch your marketing metrics (lifetime customer value, free to paid conversions, churn rate, for example), so you can spot weaknesses and target your marketing, engagement, and retention efforts more effectively.

Ultimately, however, your most important monetization strategy should be to ensure your business goals, target audience, and user base are in alignment. If your app is meant to grow awareness and engagement with your brand, you may not want to include in-app advertising, because the app itself is earning its keep by giving your customers new ways to find and interact with your business.

Keep in mind that very few of your free app users will ever click on a banner ad or cough up extra money for add-on features or content, so if you choose these monetization models, you need to have a deep understanding of what attracts your customers and motivates them to take action. This requires a deep dive into market research and your buyer persona.

In the end, however, successful monetization often comes down to trial and error, testing each of the models with your user base to see what works best, and adapting the most successful models to match your app experience.

Examples of App Monetization

Remember earlier how I said you can combine different strategies?

Well here’s an example of how you can combine advertisements with subscriptions

Let’s look at how My Fitness Pal does this.

The free version of their app has advertisements.So they can generate money that way.

However, they offer a premium upgraded experience where users can navigate without ads if they make an in-app purchase. I love this strategy because it’s a way to generate revenue from different sources.

Consider this combination option if you’re going to use both of these techniques to generate money.

Here’s another example from a popular mobile dating app, Bumble. Anyone can use Bumble for free.

But users can access premium features by making a purchase.

This upgrade lets users gain access to people who have already liked their profile.They also get unlimited extend time and the ability to rematch with users who they didn’t connect with initially.

Employing this strategy is more than just an in-app purchase.

Charging people a monthly or annual rate becomes a subscription.

I love this strategy. Subscriptions are a great way to increase customer loyalty. Plus, you’ll have a chance to get constant revenue from the same user.

When you’re trying to come up with a subscription plan, consider your target market.

Try to make your app as appealing as possible to people all over the world.

For example, mobile users in Asia spend 40% more in apps than other areas across the globe.

Development Strategies

One of the best pieces of advice you’ll hear regarding your development strategy involves adaptability.

Not everything you do will go as planned. You’ll encounter some hiccups along the way.

Don’t let those speed bumps get you flustered or overwhelmed.Make the necessary changes and move on.

Here’s a hypothetical example. Based on what we’ve discussed about pricing strategy, let’s say you’ve decided to launch an app that charges users to download it.

But you realize that nobody is downloading your app. You’re all done, right? Wrong.

Adapt and move on. Allow users to download your app for free.

Set goals to help measure your success.

Let’s say you want to get 1,000 downloads this month.If you only get 200, you’ll need to adjust your marketing strategy.

As you’re developing the app, make sure that it compliments your existing marketing strategy.

For example, if your current business has an ecommerce store, you should drive customers to download your new app as the primary outlet for online retail.

Furthermore, consumers spend three or four times longer using a mobile app than they do on a desktop page or mobile site.

Even after your app is released on the App Store, it’s not too late to continue making changes.

Make sure you give users the option to rate and review your app.Not only do those ratings help boost your search ranking in the App Store, but they also provide valuable information for your development strategy.

Use comments about the user experience to constantly create better versions of your app. You can also do beta testing to help work out any bugs or glitches before your app is released.

Outsourcing this testing is your best bet. Biased opinions can impact these tests if you’re running them in-house. Your developers may be hesitant to say there are problems with the experience if they are the ones who designed it.

Making sure your app is always running smoothly will help ensure users keep using your platform.If users are frustrated with the performance of the app, it could be the reason you’re having problems generating a profit.

Promotional Strategies

Now that you’re pricing and development strategies are in place, it’s time for you to promote your app.

You can’t get any money if users aren’t downloading it, so getting downloads fast should be your number one priority. But where do you start?

If you have an existing business, use all of your marketing channels to promote the app to your current customers. That’s the place to start.

These people are already familiar with your brand, services, or products. For the most part, this app should be welcomed with open arms.

Look how Internet usage has been trending across the globe over the past eight years.

In 2016, mobile usage finally surpassed desktops.

Based on this graph, it appears as though mobile and tablet devices will continue to rise. So give the customers what they want. Next time you send out an email marketing newsletter or promotion, include a link for your subscribers to download the app to the phone.

More than half of emails get opened on a mobile device, so your customers can have your app on their phone in just seconds if your email gives them a reason to download it.

Offer some kind of incentive.

Take 20% off your next purchase if you use our app to complete your checkout.

Something to that effect should do the trick.

I’d also recommend using your social media channels to promote the new app. For the same reason. Mobile users in the United States spend 51% of their mobile time using social media.

So it’s only logical that you promote the app on here as well.

Here’s a great example of Jasper’s Market doing this on Facebook.

It’s a simple and effective way to get more people to download your app. In turn, this will help you generate more money.

How BuildFire can help with these strategies

Once you have your pricing, development, and promotional strategies in place, you’ll need to implement them into your app.

Looking at all of this on paper is one thing, but putting it to the test can be intimidating if you’ve never done it before.

Don’t worry. BuildFire’s Pro Services Team can walk you through the process.

The platform makes it super easy for you to build the app and publish it to the App Store, even if you don’t know how to code. As an expert in this space, I can attest to how smooth this process is.

Here are some of the top reasons why BuildFire is one of the best available options for you to consider.

  • Your app will hit the market faster.
  • The platform will save you time and money.
  • It’s easy for you to continue making changes even after the app is released.
  • Risk gets reduced since the investment amount is less.
  • Critical thinking experts can help bring your plan to life.

All of these points hit the mark on the topics we’ve discussed earlier. BuildFire can ensure that you’re going to generate your first $1,000 fast.

From your dashboard, navigate to the “Monetize” option on the left side of your screen.

Now you can set up in-app purchases, which as we discussed earlier is a top option for your pricing strategy.

For $134 per month you’ll have a Professional Membership, which is our best value.

I highly recommend this if you want to add in-app purchases. It’s a much less expensive alternative to learning code and developing the app yourself.

Plus, the upgraded plan comes with other great features like push notifications, an iPad, and Android Tablet.


Generating your first $1,000 for your mobile app is a monetization milestone that can help you build confidence for continued success.

Don’t let that number intimidate you. It’s easily attainable if you implement the methods that I explained earlier.

Start with a pricing strategy.

How do you plan to make money?

  • Subscriptions
  • Advertisements
  • In-app purchases

If you want to implement in-app purchases, BuildFire lets you set that up through their platform.

Make sure your development strategy is adaptable.

You’ve got to be ready to make changes on the fly.

Next, you’ll need to find a way to get users to download your app.Use your company’s existing marketing channels like email and social media to inform customers about your new app.

The more downloads you get, the easier it will be for you to make money.

Follow this plan, and you’ll be on your way to large profits in no time at all.

Are you going to charge users to download your app or use an alternative pricing strategy to generate revenue?



10 Ways to Effectively Monetize Your Mobile App

You finally accomplished it – you created an awesome mobile app for your business.

Now, your customers can interact with you like never before, and the data you’re pulling from the app is helping you think of all kinds of new ways to market your brand.

But there’s something else you can do to make your app even better for your business: monetize.

That’s right – your app can be so much more than a tool. It can also be a serious source of additional income for your business.

Intrigued, aren’t you?

Good. By the time you’re done reading this post, you’ll have learned 10 ways to monetize your app and turn it into a profit-generating machine.

You’ll make even more money if you can promote the app for free.

1. Email Lists

You might not think of this as a likely first step, but using an email strategy tie-in with your app is a fantastic way to get more engagement from your customers, which in turn leads to more money.


Because people rarely change their email addresses. That makes an email marketing campaign an easy way to make sure users actually see your content and engage with it. Regular emails also keep your brand at the forefront of a customer’s mind, making them more likely to buy from your business.

According to Wiselytics, the total life of a Facebook post is only a few hours, while a tweet’s lifespan is just over an hour. Email, on the other hand, has a lifespan of 12 days.

And the best way to gather those email addresses is to add an email subscription form to your app.


An in-app subscription form will give your app a real boost by prompting users to enter their emails, especially if you tempt them with the prospect of some great benefits for email subscribers.

And your email strategy can be pretty varied. If you have promotions or deals, send an access code in the email that they can enter inside the app. If you write a regular newsletter or have a blog component on your website, promote those through the email while reminding users they can read all the content you produce on their mobile device.

So, whether it’s to remind your users to come back to your app after being away for a while or to try and draw in new users, email lists are marketing gold. Just something to think about.

2. Advertising

If you aren’t including ads in your app, you might be missing out on a phenomenal opportunity for monetization.

Digital advertising through mobile apps has improved the communication between advertisers and consumers dramatically. This is largely due to the crazy amount of time people spend on their phones. We’re talking at least 90 minutes a day – the equivalent of 23 days a year.

And a lot of the time, people simply don’t want to pay for the apps they spend all that time on. The temptation to download an app that costs $.99 drops away as soon as they see a cheaper (or free) alternative.

That’s why 91 percent of all app downloads were unpaid in 2013.


So, how can you get around this and still monetize?

Simple. Make your app free, and utilize in-app advertising.

Advertisers realize the value of mobile apps over those embedded in browsers or sent via SMS messages. Here’s what that breakdown will look like in 2018:


And when advertisers create ads to be used in apps, these are the five types of ads typically used:

  1. Interstitial/full screen ads – These ads are usually placed at natural pause points, like when moving between menus. Because these aren’t actually interrupting the experience of using your app, they’re more likely to generate clicks without causing frustration.
  2. Notification ads – These pop up in the mobile device’s status bar and make users more aware of the ad’s presence. Be warned, these aren’t the most well-loved ads out there, and could damage your app’s reputation.
  3. Capture form – Relying on user opt-ins, these offer incentives (like points or tokens) for users who enter their email addresses. You’ll most often find capture forms in mobile games.
  4. Advanced overlay – These use transition points like interstitial ads but are interactive instead of being simple clickable images. They’re sort of a mixture of capture form and full screen ads.
  5. Banner ads – These are usually found at the top or bottom of the screen and can be somewhat ineffective because they are more distracting than other forms. They can also irritate your users, so think twice before agreeing to incorporate one into your business’s app.


What you want to focus on the most through the implementation of these ads is engagement. It’s an idea a lot of brands are struggling to define. Put simply: the better the experience, the higher the engagement. Your ads need to entice the user, not frustrate them.

So, when you plan to incorporate an advertisement into your app, ask yourself these questions:

  • How can users have a more meaningful experience when dealing with these ads?
  • What sort of ads would the target audience prefer?
  • How can these ads tie back to my brand?
  • Will these ads be too clunky or ugly, potentially ruining part of the experience for users?

Depending on your brand, the advertisers you associate yourself with could pay you a considerable chunk of change to host their ads. According to Gartner Research, mobile advertising is poised to reach $18 billion annually.

So choose wisely – your decision could make all the difference in the profitability of your app.

3. Sponsors and Partnerships

If you can secure a partnership with another brand, you can significantly step up your monetization game.

What you’ll need to do is find a partner with a similar customer base who can add something to the experience of your users.

A partner or a network of partners can seriously benefit your customers and your businesses alike, especially if you create an integrated experience – like when Localytics and Optimizely partnered to deliver mobile analytics as a combined service.

Imagine users on another app who see your brand logo, and maybe even an interactive element typically found in your app appearing as part of the app they’re currently using. That could potentially convince them to go download your app.

And if your partner includes advertisements featuring your apps, there’s a solid chance their users might click that ad to go straight to your app. This is called a click-through rate (CTR), and in some instances, it can be as high as 12.5 percent.

So, once you’ve opened yourself up to the idea of hosting and sharing advertisements, definitely consider forming partnerships to strengthen your brand outreach.

4. Creating Strong Code

If you develop your own code from the ground up and it proves to be successful, other brands may approach you and offer to re-skin your app (either for their purposes or yours). By licensing your code to other developers, you can make money without disrupting your users’ experiences.

For example, the popular game Temple Run was re-skinned for Temple Run Oz as a film tie-in.


Another thing to consider with code-sharing is your app’s endgame. After your business has gotten as much value possible out of your app and is preparing to move onto the next step, you can actually sell it as a whole to a buyer who wants to use your existing framework to create their own app.

Fortunately, there are easy ways of doing this, like using Apptopia, a popular marketplace that facilitates the buying and selling of mobile apps.

“White labeling” your code is similar to selling it from the ground up – without actually selling off your IP. The only issue here is that there will inevitably be multiple slightly different versions of your source code bouncing around on marketplaces.

Regardless of which one of these you choose, you’ll be sure to make money by saving other developers from having to create code from scratch. All it takes is for your app to be initially constructed out of strong, desirable code.

5. In-App Purchases

Most app downloads are unpaid, but that definitely does not mean the users never have the opportunity to spend any money within the app.

In-app purchases help you make as much money as possible off of your otherwise free app and allow customers to actually interact directly with your product.


This is a huge part of so-called “freemium” apps (typically mobile games) where users pay no upfront cost but pay for gated features, but any business can make use of this strategy.

Your business can choose to provide users with the opportunity to purchase your products directly from the app (in the case of physical items) and have them shipped. Or, if you’re a business that offers services, users can even opt for in-app billing.

The downside of in-app purchases is that developers walk a fine line between giving too many options for free and offering too few features. So, be mindful of that if you choose this monetization method.

6. SMS Marketing

By using in-app prompts similar to the ones used for collecting email addresses, you can send notices for app updates, reminders, contests, and promotions straight to your users’ text message inboxes. This marketing method is one of the more effective ways to strengthen your brand because it drives users back to your app.

A person holding a Mobile phone checking new messages.
A person holding a Mobile phone checking new messages.

For example, BLUE LION mobile GmbH – a German company that created the app Qeep, one of the world’s largest mobile social discovery platforms – used SMS messaging to reach and retain their high-value users. BLUE LION’s targeted process for reaching and reactivating app users who hadn’t used the app for days or weeks was able to achieve an impressive response rate of “slightly above 10 percent.”

So if you’re looking to enhance customer engagement, give SMS marketing a try.

7. Free/Premium Versions

As mentioned before, “freemium” apps cost nothing to download, but they typically include in-app purchases that make money for the developer.

But there’s another method of generating revenue – creating an entirely separate version of your app with features that add up to a more complete experience.

Having a free/cheaper version allows users to get a sense of what your app can do for them.

Think of it like a teaser. Soon, after using the free version of your app, your customers will realize that the app can serve an important role in their lives that they simply don’t want to live without.

Then, if they enjoy what your app offers and want a better experience, they might be willing to pay for the premium version.


Keep in mind that, if users do pay for the premium version of your app, your responsibility as a developer is to make it worth it for them. That way, they’ll leave positive reviews and recommend the premium version to their friends.

8. Strong Content Strategies

One of the more certain ways to convert new or infrequent users into lifelong, paying users is to regularly refresh your app’s content.

For example, if your business has a blog, you could make the newest post available to your users via your app. And if you have industry news stories they can read natively, you need to make sure the news is always up to date.

That way, users have a good reason to keep coming back to your app for more.

The reason you need to keep customers coming back is simple. Many paying users will make one or two in-app purchases only and never return because they feel like they already used the app to its full potential. But if there’s a constant stream of new content, even non-paying users will be more likely to become customers.

But there’s another target out there besides these semi-occasional customers.

A report from 2015 from the app testing firm Swrve found that only 2.3 percent of users ever make a purchase, up from 1.5 percent in 2014. But shockingly, only 0.23 percent of that number are responsible for two-thirds of sales.

These are the customers that developers are always on the hunt for – the coveted “whale.”

A whale will spend as much money as is necessary to collect and advance as far as possible in-app or in-game. Think of someone who has played a massively multiplayer online game for more than a decade – someone who consistently buys every new piece of content they need to stay on top.

Because these whales exist, developers are often challenged with the task of specifically targeting them when developing new content. Monetization mechanics are structured in such a way as to extract money from these whales by enticing them to continue their behavior of devouring ever-increasing content.

And hunting these whales isn’t just about securing one sale. A fifth of spenders made five or more purchases a month last year.

So, when updating your app on a regular basis, always make sure there’s something irresistible in that content so you can keep your most consistent customers coming back for more.

9. Multiple Payment Options for Subscription Services

If you do regularly update your content, consider creating a subscription service for those customers who keep coming back. That way, all your users have to do is sign up to be billed monthly or quarterly, and they’ll receive all of that new content without having to remember to buy it.

But when you make use of the subscription service option, seek to differentiate between tiers of access to your content. The Economist used this strategy by allowing their users to opt for a web-only subscription, a print-only subscription, or both.


Many users saw the utility in spending that extra amount for the added value of access to both print and web subscriptions. So, when you’re monetizing your app, consider offering separate options and including one subscription package combining all the services together as a premium package. Your app could become much more profitable as a result.

10. Data-Driven Strategies

The best way to optimize your app’s ability to generate revenue is through studying the robust analytics you collect from the behaviors of your user base and putting those insights to good use.


Using this method, you can figure out who is spending the most time and money on your app and place a primary focus on those users instead of spending all of your development time on new user acquisition.

A recent study from Localytics showed that 20 percent of users never used an app again after using it only once. In other words, a considerable chunk of those new users you acquire may not engage on any level other than the initial download.

So, when you have the ability to learn why users are abandoning your app upon registration and compare their behavior with loyal users, you gain knowledge that can allow you to further optimize the user experience.

To make sure you get the highest ROI, you should always know which of your efforts are most successful with your target audience. By focusing on pursuing more of those same efforts, your app will prove more beneficial to your customers (and your business!) than ever.

And remember – whatever data you collect has value outside of your own business. Behavioral data is a gold mine to marketers. If your app is popular, there’s a solid chance that a major analytics company may want to purchase that data from you.

In Conclusion

By this point, you’re well aware of how awesome a mobile app can be for your bottom line. It can allow you to expand your brand and make connections with customers you might never have reached before. And as you’ve seen in this post, it can also be a considerable source of revenue.

You can even white label apps as way to make extra money.

So take advantage of these strategies for monetizing your mobile app, and watch your business begin to generate more app revenue than ever.

Which of these methods will you use to monetize your app? Share in the comments section!



How to Drive Sales Instantly with Push Notifications

Do you want to reach your customers where they are? How about sending a friendly reminder every now and again to say, “Hey, remember us?” In a nutshell, this is what push notifications can do for your brand.

Push notifications remind customers about your brand and drive sales.

What are push notifications?

You know those notifications you get on your smartphone? The ones that aren’t texts, emails or voicemails? Well, there’s a good chance those are push notifications. Apps use this feature to alert users of content updates, messages and other things that happen within the app. These notifications are used by all types of apps, from games to social networks and everything in between.

A push notification may be a sound, an onscreen alert, a badge or a combination of these things. Users can usually select how they would like to be notified of updates.

Should push notifications be part of your marketing strategy?

In short, yes. If your marketing strategy includes a mobile element, and most sound strategies do, you won’t want to overlook this deceptively simple “cash cow.” But even if your marketing strategy does not yet include mobile, you may rethink things after reviewing some of the data.

Time and time again, push notifications have proven to be effective.

You should use push notifications if you want:

  • 26% higher mobile app open rates
  • 92% higher mobile app retention rates
  • A marked increase in active, engaged users

Urban Airship’s Good Push Index (GPI) study found that opt-in push notifications drive 26% higher app open rates. The study analyzed more than 2,400 apps and 500 million push notifications in the first six months of download. In the ever-important first month from download, analysts found that retention rates of people who opted in for push notifications was nearly double that of those who opted out of notifications. Now, just imagine if push notifications weren’t an option and you’ll likely see lost income potential.

Push notifications vs. email

Okay, so I know what some of you Doubting Thomases are thinking: “I have great open rates on my email campaign. Why do I need to bother with a mobile app and push notifications?”

So let’s look at some of the facts.

Push provider Xtify revealed that 30 to 60 percent of users open push notifications and interaction rates as high as 40 percent. Some app developers even report open rates higher than 90 percent.

How does that compare to email? Well, according to Silverpop’s Email Marketing Benchmark study, the average open rate for email is 20 percent, and the average click-through rate is only 5.4 percent.

Are all push notifications created equal?

With one provider reporting 30 to 60 percent open rates (quite a broad range) and others reporting over 90 percent, you may have noticed that there are some performance differences. Push notifications simply work better to drive sales in some apps, but fortunately, you don’t have to be clairvoyant to know whether yours will. Just understand your industry and follow some best practices.

Let’s start with the industry. According to Urban Airship’s Good Push Index (GPI), push notifications work better for some industries than others.

Here is the average opt-in rate by industry:

  • ·Media = 50%
  • ·Sports = 48%
  • ·Retail = 46%
  • ·Gambling = 46%
  • ·Entertainment = 45%
  • ·Games = 35%

Does this mean that you shouldn’t bother if your brand is about gaming? Certainly not. It simply means that you should manage your expectations. Of all those who download your app, about 35 percent will allow you to reach them by push notification. Considering that push notifications seem to have much higher open rates than email, these are still great odds.

Push notification best practices

Now that you’re sold on the benefits of push notifications, let’s get down to the nitty gritty and talk about how to make them work for you.

Here are a few push notification best practices that will help you run a successful campaign:

1. Send them at the right time. Some notifications will naturally take place as events happen while others are scheduled. A sale is an example of a scheduled push notification. Imagine how your customers would feel if they were woken up at 3 a.m. to find out that you’re having a site-wide sale.

2. Always provide value. Never send push notifications for insignificant things. Understand how people  use your app and only send the notifications that in some way provide value, to you and to the customer. If in doubt, ask yourself whether the update may spark user interaction. If so, it’s a good update. Unread push notifications will appear on the badge app icon.

3. Don’t be too “pushy.” Since push notifications are so effective, some brands overdo it. Try to imagine how often a type of notification will be sent before you turn it on. If users are getting constant communication from you, they are likely to get annoyed and turn off all notifications.

4. Always allow opt-in. Remember that customers always have a choice. Your instinct may be to force push notifications on people, but keep in mind that the alternative is to delete your app entirely.

Push notifications are among the best ways to drive sales, and they usually provide a welcome update for your audience. The key is to know how to use them right in order to optimize open and retention rates. Although some experimentation is recommended, do try to follow best practices to avoid irritating your audience. Because once they’ve opted out or uninstalled your app, there’s a good chance they aren’t turning back.


What are your thoughts on push notifications? Have you used them to drive sales for your brand? What were the results? Let us know in the comments below!