So you know that guy or lady who builds and publishes apps, but what you don’t really know is how he makes money from those apps? You are not alone at this. If you are not into it you would not know how it works. But don’t worry because I am about to make it clear in a few sentences.
NB: The apps I am referring to here are not those from giant startups like Uber or Netflix, but the “regular” apps published on app stores by “regular” developers.
How mobile apps make money
- In-app purchases
- Premium apps
There are different ways mobile apps that you see at the Play Store and App Store make money but the ones listed above are the commonest.
This is the commonest monetization strategy that apps use.
The way it works is simple, the App developers place ads on their apps and earn when users view or interact with the ads.
For apps published on Play Store, AdMob is the most popular mobile advertising company. AdMob is similar to the AdSense program (learn how to make money with AdSense), but while AdSense is for the web content publishers, AdMob is for the app publishers.
In-app purchasing is a kinda upsell from the free or basic version of the app. You’ve probably come across those apps that ask you to upgrade to the paid version, pay to unlock some features, or offer some special items for sale.
This way the apps can make money despite that the basic app itself can be installed and used for free.
Premium apps are not free to use. These are paid apps, meaning you must purchase before using it. Although most paid apps take the in-app purchase approach, there are still a few premium apps out there.
Nothing actually goes for nothing. Some apps are 100% free but most times the developer uses those apps to promote his other apps.
This is common among 100% free apps. The goal is since the app is not generating profits, let it at least refer its users to my other apps.
Alright, guys, those are the 4 most common ways I know developers profit from their apps. As I said, there are other means, but what I have focused on is the approach used by most apps that are not ground braking like Uber or Instagram.