Is your app ready to make money? Release Notes 2016

Is your app ready to
make money?
By Ariel Michaeli
Co-Founder + CEO of appFigures
Is your app ready to make money?

1. Build an amazing app
2. Put it on the App Store 🎉
3. 🤔😬😶
4. $$$
What most people think
making apps is like:

• Started my ﬁrst company in 2002
• Studied marketing in college but
programming since high school
• Built several web companies (most SaaS)
• Launched two iOS games early
• @appFigures since 2009
👋

• Business analytics for
app makers
• No SDK required
• Beautiful, Powerful,
Simple
• Started early 2009
• Most strict privacy policy
• Very affordable

The App Store is a busy place
* Data source: Explorer, September 2016
2,249,475
iOS apps
2.3
New apps/min.

• There are more mobile devices than ever
(thanks, China!)
• And 💰💰💰billions paid out to developers

A great app is a good starting point
for making money

The other most
important thing is…

Incorporate making money into your
app’s design before starting to build it.
IMPORTANT

1. Build an amazing app
2. Put it on the App Store 🎉
3. 😀😀😀
4. $$$
0. Figure out your monetization
What making apps should
look like:

1. Identify your user - what do they need, and what
will they pay for it?
2. Understand your own economics - what do you
need to build and maintain this app?
3. Choose a monetization model - one that ﬁts your
user and you.
4. Experiment and iterate - Most of your users
won’t mind. I promise.
Four (easy) steps

Identify your user

1. What kind of app do they need?
2. Is there anything comparable now?
3. What do they charge?
4. What can this user pay?
Identify your user

5. What will this user pay?
6. How much money/time will you be saving
them?
7. how much does the user want this app?
8. how much does the user need this app?
Identify your user

Understand your
economics

1. What will the app cost to make?
2. How much to maintain?
3. Can you produce your own content, or
license it?
4. Are there ongoing fees?
Understand your economics

Understand your economics
5. How often would you need to update?
6. Can you do it all alone or do you need to
hire help?
7. What do you need to make to keep the
lights on?
8. What do you need to grow?

• Legal (especially if you work with others)
• Accounting
• Support
• Insurance (thanks, Dave)
• One-off costs (Black, or Jet Black?)
Gotchas

Select the most
appropriate
monetization strategy

• Consider all of your answers
• Select a strategy that the user will be happy
with and wouldn’t consider unrealistic
• But also would allow you to keep the lights on
Select the most appropriate
monetization strategy

Monetization strategies
• Free with In-app Purchases
• Free with Ads
• Paid
• Subscriptions
• Hybrid

Free with In-App Purchases
The good - low perceived risk to users
• Free == Easy for users to get started
• Very ﬂexible and easy to optimize
• Used by 75% of Top Grossing apps
• Tiered pricing improves mass appeal
• Easy to experiment with

Free with In-App Purchases
The bad - could get complex
• Free == Higher support burden
• Requires constant optimization
• Need to design the app around use-cases and
have enough features
• Requires lots of free users in order to make
money

Free with Ads
The good - users never have to pay
• Very easy to implement
• Lots of providers who need you more than you
need them
• Users never have to pay for your app
• Fairly predictable revenue

Free with Ads
The bad - requires a large active audience
• Higher support burden
• Requires lots of active users to make money
• Fraction of a penny for 1,000 views (in most
cases)
• Changes the user experience

Paid
• Simple model that’s very predictable
• Less support burden - Users who pay know
what they’re getting into
• Doesn’t require changes to the app
The good - very simple

Paid
• Only 2 paid apps in Top Grossing
• Only 19% of all iOS apps are paid
• 42% of paid apps cost $0.99
• Increases perceived risk for mass market
customers
The bad - hard to make money

Subscriptions
• 23% of the Top 100 Grossing apps already use
subscriptions
• Predictable revenue stream
The good - sustainable

Subscriptions
• Requires ongoing content additions
• Requires a back-end that provides additional
value (syncing, backup, sharing, etc.)
• Requires users to make a commitment -
Increases perceived risk.
The bad - requires a service, not a product.

Subscriptions
Warning

Mixing and matching
• Combining could reduce risk for users while
increasing revenue
• Most common is ads + IAPs
• Worth considering
• Harder to maintain

Let’s give this a try
Say we have an app that:
1. Is used to take notes
2. Can work on a single device without a back-end
3. Can sync to multiple devices with a back-end
Two questions:
1. Who’s the user
2. What are our economics

Who’s the user
• Anyone that needs to take notes
• Especially users with multiple devices
• Possibly on multiple platforms
• That want something better than the stock
Notes app

What are our economics
• Large upfront cost for creating apps
• Ongoing cost to maintain an scale a back-end
• Minimal cost to maintain apps

Subscriptions
If you said
You’d be right!
😀😭

Experiment and
iterate

Experiment and iterate
• Every strategy is easy to experiment with
• One size doesn’t ﬁt all
• Once you selected a strategy - try out
different prices or tiers
• Set goals and measure everything
• (Most) users won’t mind
• I know from experience

1. Appropriate monetization strategy is key to
success on the App Store
2. It needs to ﬁt your users
3. But also requires that you understand your own
economics
4. It’s ok to experiment and iterate
5. And important that you track your success
Let’s review

That’s it, for now.
Come say 👋 and let’s 🍻

Ariel Michaeli
Co-Founder + CEO of appFigures
Track all of your apps @ appﬁgures.com
@arielmichaeli
https://arielmichaeli.com
ariel@appﬁgures.com

Is your app ready to make money? Release Notes 2016

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