Thursday, April 27, 2017

Trendy Revenue Models used by Android and iOS Mobile App Developers to Make Money

Revenue generated by mobile apps has been growing exponentially. Revenues from paid apps will be $195 billion while that from in-app purchases is forecasted to be $289 billion in 2017. Still, 54% of that revenue will be claimed by 2% of the apps. Choosing the right monetization channel is essential to be on top of this hierarchy. The right revenue model for an app depends on the user engagement, type of app and expense needed for marketing. Take a look at various revenue models used by Windows, Android and iOS mobile app developers to make money.

In-App Advertising

Selling ad space in the mobile app is one of the most common methods to generate revenue. This allows Windows, Android and iOS mobile app developers to offer free apps. The lack of cost barrier helps in acquiring larger user base which is targeted by advertisers. These free to download apps possess information regarding user location and behavior which is in great demand for marketers. Availability of such information and the willingness among advertisers to pay for it makes this model sustainable and popular among developers.

Even though free apps bring more users, ads can compromise user experience and design which can become a roadblock to scaling the app further. Also, this model doesnt work with utility apps whose USP is user experience. However, targeted and limited in-app advertising can bring revenues without compromising on user experience. 


In Freemium model, the Windows, Android and iOS apps offer free as well as paid features. Free features help in acquiring users and bring user engagement. Certain additional features cost money to be unlocked. The large user base allows more prospects of purchase of extra features. This combination of lead generation and sale conversion suits game, entertainment and productivity apps.
The developer should ensure that free features arent inferior and strike the right balance between free and paid features to reduce rejection rate and also to give adequate incentive to buy extra features. 

Paid Windows, Android and iOS apps

Paid App model helps developers get upfront revenue. A paid app which can cost between $0.99 and $999.99 needs to convince its users that it is worth paying than using free substitutes. It can do so by selling its unique features and functionalities, that free apps cannot offer.
This model allows Windows, Android and iOS mobile app developers to bring more innovative features to the mobile app with cleaner interface for their users. The user base for such apps is small but more engaged than regular users. However, Paid apps have to endure stiff competition from their free alternatives and also forego part of their revenue to the app store.

In-App purchases

In this model, the Windows, Android and iOS apps act as a sales channel for either physical goods like clothes and accessories or virtual goods like mobile game currency or extra lives, which brings engagement from the users. When it comes to revenue, this model brings comfortable profit with less risk. It is especially suitable for e-commerce which can earn higher margin than their brick and mortar stores. It is to be noted though that app stores take a share from the revenue earned by selling virtual products.


This model is similar to freemium as it offers free predetermined content and offers paid subscription for premium content worth paying, often with free trial. This brings user loyalty and engagement, and continual revenue to the mobile app developers. This monetization model suits news, lifestyle and entertainment apps.
Partnership with Advertisers
In this model, advertisers reward Windows, Android and iOS apps users for certain in-app action and the app earns a small share of the redeemed reward. This ad-free model brings revenue as well as user engagement and satisfies mobile app developers, advertisers and users alike. This model is however relatively new and less tested.

All these revenue models are not mutually exclusive but can be used depending on the user segment the app targets. It is very common for freemium apps, for example, to use advertisements for the free version and offer paid ad-free versions of the app.

Twistfuture Software Pvt. Ltd. is a Mobileapp development company in India which specializes in Android App development, iPhone App development, Windows App development, MobileGames development, Unity 3D development, Multiplayer Games development, Casino Games development, and more. Get the Windows, Android and iOS Mobile App from TwistFuture and monetize it using the revenue model that suits your app.