Business IdeasWhere to start a business

How to Make Money With a Mobile App in 2018

In this day and age, companies have much more options in generating revenue that they had even ten years ago. Back in the day, the companies needed to make everything within a realm of possible in order to turn potential audience into the customers. 
Today things have changed drastically. Believe it or not, but the fact is the fact – free apps make money too. Even more so – they make A LOT of money if done right. This sea change was caused by the spread of fast affordable internet and change of customer’s focus from desktops to mobile phones. Now companies don’t even need to charge their customers in order to generate revenue.
According to the recent stats – overall market share of mobile apps is slightly higher than desktop, but there is a catch. People are using more applications on the phones than on desktops which are used mostly for specific purposes. That means, there are more room for maneuvers.
It all comes together via a combination of valuable service and increasing customer’s interest in getting more of it. There are dozens upon dozens of various options of generating revenue with free apps.
However, all of them boil down to a set of essential factors:
Determining target audience, its needs and expectations.
Developing a product accordingly
Transmitting the right message and connecting the product with the target audience.
If done right – this is the foundation for further monetization.Here are several ways how to make money with a mobile app in 2018.

1 Advertising

Let’s start from the most obvious one. Advertising is probably the easiest way of generating revenue out of free application. All you need to do is to provide engaging and effective services for the user and in the meantime he will see an assorted collection of various ads for other products.
Revenue is usually generated by the Cost-per-click / cost-per-impression model. However, before you start putting ads on your app you need to establish it as a valuable player in the market share. With this, your app will act as an influencer.
As for the ads themselves, it is a tricky thing. First of all, you need to put ads in a way that won’t be overly intrusive to the user experience. Here are the most trending types of ads, as for the beginning of the year:
Rewarded video – when watching ad gives user some sort of reward;
Banner – tried and tested sideline banger;
Rich interstitial pop-up – attention-grabbing screen-covering event. Needs good content in order to work.
Video Interstitial – dynamic variation of the previous.
In-app advertising done right generates a loop which drive audience from one app to another which multiplies the revenue of all involved parties.
However, in order for ads to work – company needs to invest into target audience research and adapt to the changes in behavior accordingly.

2 In-app purchases

Another viable option for generating revenue from a free application is through additional in-app purchases. The catch is – your application needs to be a top notch gangbuster in the first place in order to pull this off. Otherwise, no one will care. Keep that in mind.
Here’s how it works, you need to provide excellent user experience, fulfill the needs of the target audience thus manage to build a trustworthy relationship between you and target audience via quality and reasonable value proposition. If you are to pull this off, then users will be ready to pay to get more of your stuff.
The scope of the purchases varies from the type of an application. Generally, there are several types of in-app purchases:
Additional functions;
Advertisements free interface;
Expansion of features (new filters, etc);
Seasonal updates;
Inconsequential design changes;
Also, it is important to remember that you can’t touch basic set of functions. This thing stays free no matter what.
Overall, in-app purchases are much more effective amongst the game developers as they have much more options in terms of content.

3 Freemium / Premium model

For the majority of free applications, freemium / premium model seems to be the most feasible option. It is much easier to realize then in-app purchases and it sure needs less hands-on approach than in-app ads.
How it works? You make an app with a basic set of functions. Those features that are required for an apps consistent and cohesive performance. They are compelling enough for you to start teasing a bigger set of function at certain price. It is especially comes in handy when you need to reward long-time users – you can combine it with discount and special offers.
However, this model requires really compelling user experience in order to take off. The trick is in having a variety of options – you can such and such set of options for this price and such and such set of option for that price. Also, don’t forget to enable a tryout period so that the users would get a taste of a premium version.

4 – Partnership & Sponsorship

Building a partnership between several product in order to promote one another is a tried and tested option as old as time itself. The reasons for that are simple: it allows to make an audience overlap, expose your product to a different audience segment and hopefully make your overall audience bigger. On the other hand, you are doing the same favor for the friendly company.
However, upon considering such options you need to clearly define goals and responsibilities between involved parties.
This method allows to build an audience relatively fast. But there is one but – you’re going to need much more elaborate marketing strategy in order to incite interest within the overlapping audience.

5 Ads-free version

In a decidedly vitriolic and bastardous twist of fate, advertisements can be beneficial for the product even when they are not present. Because you can literally offer users ads-free version.
Ads-free version can be option your product is providing otherwise exceptional user experience with strong engagement. In this case, users will probably pursue an offer to use an app without all those pesky eyesore ads that sometimes cover the entire screen and are just miserably irritating.
However, keep in mind, that the majority of users are able to ignore ads by sheer force of will due to continuous exposure and mental training. This means – ads-free version can be an option only in combination with other monetization methods.

In conclusion

Free app monetization is a tricky thing.
On one hand, you can do it in a variety of ways. On the other, every monetization method got their own pros and cons and there is no guarantee that a specific method will take off even though the market research claims so.
One thing is for sure – you need to compose an intricate strategy that will include a variety of options that will cover the majority of the target audience.


Kate is a freelance UX designer and tech writer. She is now working on unorthodox usability and accessibility solutions for mobile applications. Want to come up with killer design scheme. Kate is a self taught data science enthusiast and crypto fan. Also she enjoys writing about her explorations in the ever changing world of IT-industry. Check her latest article

What's your reaction?

In Love
Not Sure

You may also like

Leave a reply