We all want to create something from which we can make money. And whatever your reasons for creating an app are, we all have one reason that is common for all, that is to make money. But for that it is very important for important that app developers have a proper revenue plan to follow, or else you may end up wasting your time and financial resources.
Many developers often make the mistake of thinking that just simply creating an app would begin an inflow of money. But it is simply not true. Just like a business, developing an app would not automatically start money generation. For that one needs an effective monetization strategy.
If you are confused about where you should start from, you are at the right place, for we will now go through some effective app monetization strategies.
It is very important that the business websites be optimized for mobile devices as well. Why? According to a research 90% of the time on mobile is spent on apps, and only a 10% is spent on browsers. So optimizing a business website for phone devices should be one’s priority.
In a survey when people were asked why they preferred apps over mobile sites, convenience and enhanced user experience were the popular answers. Time is of essence and our customers are no different. They want everything to be done fast. And so a website not being optimized for mobile devices have a risk of affecting its speed.
Another thing that is of advantage of mobile apps is the check-out process. The check-out process of a mobile app is simpler which make your customers happy and keeps them coming back. Cards or accounts are linked to apps which makes purchasing on apps much easier and faster, which is not the case with mobile sites because a customer has to keep entering their account details again and again which slows down their purchasing process.
App Monetization Strategy for Products
Number of smartphone users who buy something online continuously grows each year. Let’s look at a company called Touch of Modern, so that you may be able to get some insights on their strategy. It is not a very well-known company, but their app strategy is a great example to follow.
70% of their sales are generated from mobile phones, and two-third from their app. How? Let’s get more into it.
An approximate of 1,50,000 to 2,00,000 users download their app each month and 57% of their customers purchase from them repeatedly. A formula that focuses on customer acquisition as well as retention simultaneously is a successful formula.
The company is very successful mainly because of their check-out flow.
Upon downloading the app, a customer is required to create their profile so that their information is saved securely. And so the next time the customer opens the app, they straightaway get to shopping.
Their screen is very simple and easy to navigate. They simply scroll down the screen and if they find something interesting, they click on the item to find more information. That leads them to a large picture of the product and its description. If they like what they see, with just a single click they add to their cart and again in a single click they can check-out.
This strategy works wonders for them. If you too are dealing with products, you can boost your sales and increase your revenue by building a mobile app using the right strategies.
Monetization methods for free apps
You will have to decide if you are going for free or paid apps.
90% of the apps on Apple Store are free, and they do make money.
But paid apps have their advantage in term of getting you more loyal customers. For if they are willing to pay to download your app, they are more likely to use it and make further purchases.
But there is also a downside. Once they realize they can find a similar app that is even better and all for free, they may go for them than download your app.
But there are other channels from where you can earn your revenue, like video ads, display ads, installs and subscriptions etc.
You can generate money by selling advertising space on your app. However the numbers are not fixed but variable. But if you have a large number of users who are very active daily and your app becomes more popular, you can then negotiate a higher rate from advertisers.
Subscriptions and updates are a great way of earning recurring revenue.
Another way is the freemium model, wherein the free version of the app contains ads, pop-ups, sponsorships etc., but upon paying for the premium version of the app all the ads get eliminated and a better user experience is delivered.
All in all, almost everyone prefers mobile apps over browsers.
So it is very important for businesses, especially the ones that deal with physical products, to have websites that are optimized for mobile devices too, as that leads to a better customer experience.