App Monetisation:Choosing the Best Business Model for Revenue Generation T: UK +44 (0) 20 71127100 | www.apppli.com
The Road from App Development to App Revenue So you’ve created a professional, useful and attractive application and you want (ideally!) to make some money with it: what to do next? Here are the possible monetisation models to consider: 1. Immediate Revenue Third Party Supported Advertising Sponsorship Payments Paid Downloads Subscriptions In-app Purchases 2. Long-term Revenue Establish and Exploit Branding
The Pros and Cons of Third Party Revenue• By relying on third party revenue you can offer the app free and • Increase brand reputation • Increase App Store presence • Build a following• Ad Revenue = Clicks x CPC• Of all other revenue models out there, one payment model has become the most successful in the past several months…
Apps with In-App Purchasing Now, in-app purchasing is driving revenue for the top grossing apps End-users can purchase upgrades, more levels, virtual goods, or extra features from within the App Top 20 grossing game apps - 60% drive revenue with in-app purchases.* In-app purchases on free apps - 15% of total app revenue on iPad and 14% of all total app revenue on paid apps in Dec 2010.*** iTunes Top Grossing App Chart, March 4th, 2011.** Distimo***Flurry
A Few Apps with in-App Purchasing Functionality…
In-App Purchasing: The Pros• Enables you to create content, features, or offer services from within your app.• Allows you to create revenue while exploiting the high download rate of free applications. Users are willing to spend more on extra content!• Allows experimentation with different monetisation models (subscriptions, pay-per-feature transactions, etc).
In-App Purchasing: The Cons• It takes more time and effort to configure in-app purchasing capabilities.• Your app needs to have strong micro-transaction potential• You must be able to create additional content, functionalities or offer new services.
In Conclusion…• This talk has touched on the basic monetization models…• Best monetisation strategies often require experimentation with a combination of these models• Choosing the best monetisation model will depend on several factors: 1. The target market 2. The micro-transaction potential of the app 3. The kind of value it offers to users