How to build a money-making mobile app

6 min readNov 20, 2019

Everybody wants to build an app, as mobile app development is the best way to develop your business in the digital age. Talk about the Ubers, the Airbnbs, the Spotify the Twitters, the Whatsapps of the world and you are bound to get a new age entrepreneur excited. And why not? The app revenue till 2018 was $365 billion and is projected to go up to $935 billion till 2023.

With so much money on the table, mobile app development has prompted a technological gold-rush with everybody wanting some piece of the action.

But your mobile app must be in the Top 100 apps on the app store to earn truckloads of money. It is evident from the fact that an app which is in the Top 100 bracket in Apple and Google app store makes $130.4 million.

Here are some of the basic things that you need to consider in your mobile app:

Get clarity on the purpose of your app

Having clarity about the usage and use of the app is of utmost importance. A clear mindset will propel you to develop a mobile app that will do wonders at the app market.

You should have a clear value proposition which details the benefits users will derive by using your mobile app. Remember to bifurcate benefits from features as if the elements are of no use; it can kill the user experience.

For example, Uber’s value proposition,” the smartest way to get around” clearly states the value Uber aims to create with its app.

Analyze your competitors with a magnifying glass!

It is essential to have a complete analysis of the competition and market before going any further in the mobile app development process. Study what your competitors are doing, what kind of technologies they are using, etc. Try and see their pattern of work and learn from their mistakes. A close examination of the reviews posted on your competitor’s app will reveal the pain points of users. Use big data analytics through the help experts to gain a systematic analysis of the rival companies and their recent activities. You can ensure that these pain points are checked in your app, which will attract users to your app.

What would be your customer acquisition strategy?

Well, this is a million-dollar question. To make any mobile app successful, it is imperative that more and more users download the app. You need to conduct thorough market research in order to understand your user. It would help you in identifying the strategy which you can take to boost app installations.

You can use the following strategies to help you reach a broad target audience

Paid apps in various social media sites
Influencer marketing
Content marketing
App-store optimization
E-mail marketing
Referrals and invite

The process of making money making mobile app starts right at the time of mobile app development. You need to ask your mobile app development company about the monetization options they are putting into the app. Care must be taken that the features don’t harm or hamper the customer experience.

Freemium

The word freemium is a combination of two words free and premium. Hence as the name implies in this model, you distribute the mobile app for free and charge for some premium features. A well qualified mobile app development company can make a substantial positive difference here. The premium features might include

Ad-free experience
Unlocking more features of the app

One way Zappier (a service automation app) applies the freemium strategy is to let new users try five zaps, for example, you can run a zap which gets the details of all the users who have enquired about your product on your e-mail list on MailChimp.

What’s more important is that the pricing plans are designed in such a manner that the user doesn’t feel the “pinch,” they gradually move upwards from one pricing plan to the other.

Another approach towards the freemium model is to give the same feature but in much less quantity. For example, Dropbox allows its free users to get storage space up to 2gb free of cost, while for upgrading storage space till 1 TB requires you to upgrade to the premium plan.

You can include in-app ads to drive revenue. In-app ads help to keep your mobile app free and do not adversely affect the popularity of your app unless used excessively.

There are various methods of gaining revenue through in-app ads; some of them are listed below.

Affiliate ads
Cost per click
Cost per view
Cost per install

Subscription model

In this model, you can ask for subscription plans from users. In order to hook the user to your app, you can offer a free trial period. This tried and tested formula is applied by many successful subscription apps like HBO, Spotify, Blinkist, Hulu, Netflix, and Amazon Prime Video. The trial period can range from 7–30 days or more depending on your app.

You can even allow the user to continue using the app even after the trial period is over but with limited features.

Spotify uses this feature effectively, you use Spotify for free but with a shuffle mode on. In this mode, you are not allowed to select your favorite song or artist, and the app will randomly play the music for you.

If you want the full-featured version of the app, you can buy the subscription plan for $15 per month.

You can even give promotional offers and discounts to increase the percentage of users signing up for the subscription plan. For example, Treehouse(a coding learning platform) doles out an extra two month’s worth subscription if you choose to buy a full year of subscription plan.

You can also give multiple user options like Netflix does so as to improve user engagement and get the right ‘Word of mouth’ publicity.

Paid apps

You can ask for payment for your app before the user installs it. The best way to implement this strategy would be to give two versions of the mobile app. One version is a lite version with a limited number of features. The other version will be a full-fledged version with lots of features.

An excellent example of a paid app being successful is a drawing app called, “Draw something,” the app charges $3.99 for installing it into your iPhone.

The critical thing to keep in mind while opting for this pricing model is that the free app should hook the user; otherwise, there are little chances that your Paid version sells.

Once the monetization model is decided, it is crucial that you keep track of your app’s performance. See you cannot improve anything If you are not continually monitoring it.

Here are some KPIs(key performance indicators) which you shall need to keep track of, in order to know how your app is performing.

App retention rate
Number of Active users
Number of in-app purchases
App usage
The average revenue per user
Average time spent in the app
Number of subscriptions and sign-ups

Monitoring these critical parameters of app performance will let you correct the course of action if you feel that something is not working.

Tinder is one app which believed in continually experimenting with their revenue models; they even tried a model which included in-app purchases. This is how they led to their current subscription tier model, which has led to the app being among the top-revenue generating apps on app stores.

Also Read: 7 Steps to Perfecting your App Store Optimization

To wrap it up

The thing with monetization models is that you will need to select the model which is best suited for your app. If you carefully consider all the above factors, then building a money-making app is easy.