All app publishers want to get their money’s worth by mapping the right marketing strategy.
The success of an app on the market depends on so many factors, that one may write a whole book in the effort to analyse everything that influences this challenging process.
We focused on monetization process in terms of app distribution channels and whether a new app should be launched to one market or across multiple platforms and classical making money schemes + paid apps pros, cons and what app can gain from it.
Distribution channels
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App Store success is taken for granted because it is reliable and trustworthy. 93% of all the applications get downloaded monthly.
The the most important reason for its financial success, whether developers like it or not, is Apple’s tortuous approval process.
Google Play beat AppStore in size but not in revenue. Even though Android has won the market with his numerous devices, Apps developed for iOS make more money.
To cut a long story short, not all that glitters for a user is gold or a developer.
As of Q2 2013, app downloads in Google Play were about 10% higher than those in the iOS App Store. Though Google Play led the iOS App Store in one key measure, there still remained a wide gap in app monetization, as the iOS App Store generated 2.3x the app revenue of Google Play.
https://blog.appannie.com/app-annie-index-market-q2-2013/
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Those two big monsters are not the only ones. Other popular brands are Blackberry, Amazon and Microsoft.
Why Blackberry?
Blackberry’s offered a $10,000 revenue guarantee to any app maker that sold at least $1,000 worth of apps. To add more, incentives like 80% cut of revenue from each sale, support for PayPal billing, keyword searches and other changes draw a developer’s attention.
Why Amazon?
The mobile analytics firm Flurry said the Amazon Appstore is nearly on par with the Apple App Store in generating revenue for developers, but it’s much smaller. Amazon Appstore unlike Google Play lets you put your paid app free for some time and then come back to a paid version + they have their own Free App of The Day promotion.
Why Microsoft?
The Windows Phone Store has a $99 registration fee. But Microsoft has upped to 100 the number of free apps that companies can submit without paying another $19.99 per app, and Microsoft does not charge for submitting paid apps + they are well-tested.
When the app gets successfully sold on the mainstream markets it may also be a good idea to cover the third party venues in order to maximize the profit.
Outside the mainstream
Among the best of them you may consider stores like GetJar, F-Droid and SlideME, Appoke, Handango (Pocketgear) and MobiHand. They have their pros and cons. The biggest concern here is malware and security policy. So don’t jump to conclusions and make sure you weigh all the risks and make the right choice.
Should you start with one app market or the more the better?
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AppStore is more likely to bring you money than Google Play. You can try both at the same time + other markets if you are a big fan of a saying “the more the better”.
Your app is new and green, nobody knows about it and you have 0 metrics data. You want to cover all the markets from the start? What’s the point?
After ou Event Countdown app called My Day had been launched to AppStore it got many downloads within a short period of time. However after half a year all the users suddenly disappeared leaving us with 1% of retention rate and food for reflection. In order to gain customers again we had to consider users experience, usage, retention, engagement and other metrics to optimize and improve our app. With all the work that had been done My Day reached 45% of retention and is ready for a push on Google Play.
Large number of downloads doesn’t matter anything as 69% of users, according to a SessionM study, will never visit it again. So instead of focusing at the vanity metrics it is most important to find out who your loyal users are and study their behavior and engagement with the app.
The reasonable approach to make profit and minimize risks looks like that:
Choose one market > collect the metrics > analyse > improve > iterate, iterate, iterate > win other markets.
Classical making money schemes:
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Once the place to sell an app is picked the next question to answer on the path to monetization is how to choose the right business model. We outlined the most common ones.
Freemium
As AppMuse CEO Mark Stetler stated, “The mobile app ecosystem is steadily trending to a point where the free mobile app is the rule rather than the exception.”
Free apps currently account for about 60 and 80 percent of the total available apps in Apple’s App Store and Google Play respectively.
A making money scheme: you either give users basic app functional for free and use in-app purchase as a method of monetization by putting the price for extra tools or features and you can use it as an advertising technique. By far and large it is the most profitable model. But the features you put to the app should be customized based on UX to make it as valuable as possible.
Paid download
It is not very common in app world but still exists for some really unique apps or high-budget games. Paid download is not advisable for Android because this market has pirated apps and big competition. You also run the risk of chargebacks, which does not cause any trouble for a user to do.
Subscription
This scheme requires regular content or service valuable for users and charges weekly, monthly or annual subscription fees. This way to earn money will take a long time as you need to learn about your audience and collect the data they would be interested in and much development expenses.
Developers can learn some lessons from a iPad-only subscription news app The Daily’s, as Mathew Ingram noted in a post for GigaOm: “Don’t ignore the Web, don’t make your content platform-specific (unless it is unique), and don’t put a paywall around something no one has ever seen before.”
In-app ads or Advertising model
You build advertising space into a product and sell it to brands whose production appeals to the app’s target audience.
The “old school” approach to mobile apps which means “data first, it doesn’t matter who the users are and how they get engaged with the app” and “CPM banners - stick and hope for a click” is becoming less efficient and overestimated. Even using CPA networks (like flurry, tapjoy, w3i, abbrupt) who sell app downloads has given its place to a “new school”, which creates native to the app ad experience by means of detailed knowledge about a loyal user and an essential part of the product. This builds a valuable quality, generates good app performance so that loyal app audience will be exposed to more ad content and that advertisers are willing to pay a premium to reach.
Paid apps issues
Unless your app is unique and applicable for definite sphere of business in the way a user can not but have it, that’s not a good idea to even try to make an app premium, especially on Android Market.
Even though a price of app download is often low, somehow it rarely occurs to a customer to even look at it. Dave Addey, who runs an app development studio in the UK even wrote a whole article headlined “Apps are too cheap”.
By putting a price tag on the app you may run the risk of users rating it harshly in case they find any flaws in it.
Incentive is what drives people into getting lured to your app. There is always a chance that a user may buy and like it. Otherwise you should look into newly invented devices and markets that have enough space for new ideas and customers.
