Apps can be a source of revenue. Here’s how.
So you have an idea for an app that you think will be downloaded by millions of people and make tons of money. How does it make “tons of money”?
“I’m gonna charge everyone a dollar for it!”- well if that’s the case, then why are there so many free apps on the apps stores? There are far more free apps (they say “get”) than paid apps advertised. If simply charging a dollar was the answer to getting your app downloaded don’t you think there would be more listed on the app store?
Don’t get us wrong there are A TON of apps listed for $0.99 but just look at this screenshot from our iPhone:
We had to scroll past some apps we already downloaded for free so that you could see just how prevalent the “get” apps were. Considering the number of free apps, it begs the following question.
How Do Apps Make Money If They’re Free?
Here’s a shortlist of ways apps that are listed for free actually make money:
- They have ads
If you’ve ever played a free game on your phone you’ve probably noticed you spend quite a bit of time watching ads in between levels or maybe just to get one more shot at completion. On average, if your app is hosting ads it can make about $0.02 per impression (viewed ad). So if relying on ads alone, how many ads do you need to have viewed to make a living? Well we can’t really tell you how much money you need to live so we invite you to do the math!
2. Selling User Information
This is probably our least favorite way to make money with an app on our list. People don’t like to know that they are a product. Essentially putting a price on your info is putting a price on you and we just don’t like it. If you’re curious to know how much your data is worth to people visit Invisibly. We found it kind of depressing actually. We thought we might be worth more! Everything has a price as long as people are willing to pay. Your email, your phone number, even your address can all be bought. Sad right?
3. The Price Itself
Remember how we discussed putting the app for sale on the store for $0.99? This itself can be a way for you to generate a return. Make an app that adds enough value to people, or a game that is fun enough, and you might just get enough people to download it to make money. Just remember in order to get people’s eyes on your app you may need to do some marketing for it. You can see some of the marketing we’ve done for our own app PopVideo in the videos below:
4. Upsell (In-App Purchases)
Another way to generate revenue from an app is by incentivizing a purchase. For example, oftentimes apps will offer the ability to turn off ads through a purchase. Or maybe you’re playing a game and want to purchase upgrades for your character. Or maybe you want access to certain app features that aren’t available in the free version. There are lots of ways to incentivize a purchase within your app.
5. Making Money By Adding Value
Let’s say you own a business that improves other businesses’ compliance. Let’s say you’re a compliance consultant. When companies partner with you or utilize your services they are provided access to an app that digitizes workplace processes such as ensuring the building is locked or granting employee access to cameras remotely. Maybe there’s a cleaning checklist within the app. Whatever type of compliance consultant service you offer, if your app is the selling point for clients and is bringing in more business, then, in turn, the app is generating revenue.
We hope this list has answered some questions and that you found the article insightful. Please consider checking out our other blog posts below.
- What Three Countries Have the most App Developers?
- What Is an IP Address?
- What Is a Phishing Scheme?
- As an App Founder, What Do I Need to Know about Passwords?
- What is SaaS Software?
If you ever have more questions about apps you can also contact us at firstname.lastname@example.org or give us a call at 208 344 1115.
As a bonus for sticking around here’s a link to our app pitch guide which hopefully helps you come up with some clear and clever ways to share your app idea.
Free apps? They might not be as “free” as you think.
Are apps free to download in 2022? Yes. There most certainly are free to download apps out there. Check out the screenshot from our phone.
Do you see the word “GET” there? Those apps are free to download. Now, check out the first app on the list, “A Musical Story” it costs $4.99 to download. That’s a paid app. But, if you look a little closer under the “free” apps you will see “In-App Purchases”. Are they really free?
Your “free” app could just be a trial
You might be able to download the app for free but that doesn’t always mean you will have access to all of the main features. Sometimes it will be a 7-day trial. Sometimes you can only play the first level of a game. Sometimes you get the whole app for free. Sometimes.
Your powerbill will reflect the cost
Researchers at the University of Southern California, the Rochester Institute of Technology and Queen’s University did a study on phone usage found that phone apps with ads use 16% more energy. This translates to 1.7 cents every time a user used the app based on a per MB charge by AT&T. So if you are the type of person that plays on your phone throughout the day, your “free” app is actually costing you.
Do you consider your data free?
In 2018 Semantic did a study on 100 free apps in the Google Play Store and the data that they were able to gather on their users. Here’s some numbers:
45% had users’ locations tracked
46% had access to a user’s camera
25% could record audio
10% got your phone log
4% had user addresses
If you put a price on this kind of information would you really call it “free”?
You might want to check your data usage
with your phone carrier
Free doesn’t mean that it doesn’t use cellular data. If you don’t pay for unlimited data free apps might cost you, and if you pay for unlimited because of all of your “free” apps, they already are.
So are apps free in 2022? Sure if it says “GET” that app is free to download. But is it really free? We’ll let you be the judge.