The document discusses various monetization strategies for mobile apps, including paid apps, freemium models, in-app purchases, subscriptions, advertising, and other indirect monetization approaches. It notes that only about 1/3 of apps are profitable and highlights factors like quality, engagement, retention, pricing, and platform that influence revenue. The document provides tips for experimenting with different monetization models and optimizing strategies like ads, trials, and cross-promotion.
41. Availability of substitutes
Price of substitutes
Necessity
Who‟s paying
Brand awareness and respect
Relative cost to buyer
Perceived production value
Culture
Device
OS
Perceived value
Perceived lifespan
Payment options
Seasonality
The long tailDoesn’t work if you’re just a point in the tailWorks if you have lots of apps or you’re the store
Whether you’re selling apps, clicks or eyeballsIf a race to the bottom is this just about competing on price – you can do better than this
LinkedIn comments from developers discussing best monetization strategiesReally? Based on what?Even on a high end/expensive device? In all markets?
As opposed to apps that don’t want to cover costs or make a profit?
Given up on getting more users or producing more or a better product
Having a product (or idea) is not the same as having a viable business
Rather than what you want (or can) and then trying to work out how to monetize it later.Of course if you have funding to keep going while you amass a large user base and then work out how to monetize later go ahead. But you’ll need deep pockets and to be able to keep all those usersJust because you build it…Trying to monetize a small user base is very hard (especially if not highly focused) and you will likely be more profitable doing something else.But you have to build something you are knowledgeable and passionate about. So you care enough to make it great and keep going when it gets hard
This is what people pay for.Even if that problem is what to do with free time – solved by a great new game
Not as many people doing it – less competitionPeople more willing to pay more – potentially people pay big money for life changingsocial, weather and utility apps aren't where the real money is madefinance & business apps make money
A reasonable assumption but backed up with figuresbetter app quality results in more downloads and revenue (http://build.developereconomics.com/how-better-app-quality-results-in-more-downloads-and-revenue/)
Time can also include number of times usedDepends on app lifespanTime restriction normally the worse as often short and don’t give enough time to get addicted
SupportInfrastructure(?)BackendPromotion/marketing/cost of acquisitionARPU/DLifetime Costs
A high end 3d game can probably charge more than a simple casual game from an indie developer
People don’t like it when the price goes down (if they’ve just paid more)Cheap initiallyThen higherThen come down after timeLots of fluctuations can be unsettling and is unnecessaryDifferent prices in different marketplaces (if platform has multiple marketplaces)
Maximizing revenue
Price elasticity of demand
Be easy to buy fromSeamless integration is key to being effective – else just don’t do it : break in flow causes people to stopHow about offering to buy an extra life when die and close to reaching a new levelOrExtra points when close to a top scoreHear be fear – of bill shock
IAP doesn’t just mean freemium but it’s one of the best ways to do freemium
A separate FREE app is bad – get all your users and reviews in one placeTruly free provides no real benefit to you orFree users can end up with an inferior experienceMore to keep in sync for developers
Engagement drives IAP for games:strategy trivia, family (http://build.developereconomics.com/engagement-drives-in-app-purchases-for-games/)people playing for longer leads to more from IAP more than 18x as much in some instances
Depending on what platform allowsConsider other payment providersOffer not just a 30/20%age cutSmall fee and smaller %age – may work out cheaper for you on larger amountse.g. fortumo.com or do it yourself or PayPal
Obviously good from your point of viewBut Make users LOVE you if don’t have to pay to use on each device. Especially if you can share/link details/progress across devicesAd supported, functionally limited trials are a different form of double charging that can frustrate users – a very short term view by devs : can give the impression to users that just want a quick return and not focusing on making the best products for the long term
Competition and device precedents can mean this is the best approachSoundHound: free [MS], $4.99[ovi], $5.99[a]. $6.99[i]But this can anger and confuse customers – is this discrimination? It may be seen as such? What about paid on one OS but ad supported on another (e.g. Angry Birds)
Why wouldn’t you?But make sure you feel appropriate on each platform : successful apps do thi
Culture of country may impact what people are willing to pay
Some platforms more than othersSome countries more than others
Leak it yourself To control qualityBut modify approprately
Typically higher prices on tabletGoogle I/O 2013a higher propensity to buy things on tablets vs. phones1.7x higher purchase rate on tablets
Typically this means:Free or very cheap at firstThen a higher pricePrice comes down over time
On Windows Phone: (marketplace stats from early 2012)70 times more downloads : 10% conversion rate : 7 times more sales
Time can also include number of times usedDepends on app lifespanTime restriction normally the worse as often short and don’t give enough time to get addicted
£2 a month isn’t really a big dealSmall amounts regularly are better than a bit once/occasionallyGet people in the habit of giving/spendingSmall amounts are easier to get
Provide ongoing valueIncentivize/rewards/motivate repeated use – extra benefits the more days use the app consecutivelyEncourage re-engagement – get details to contact them, could just be push notification
It’s harder to add laterBetter to build something that has retention/continuous engagement at it’s core
Call for detailsIf an option - can charge bigComplicated, longer, more expensive sales processThey’re paying for support – make sure you can provideCould be as much as 10 times the price
But least effective for generating revenue
Not about how people are treated
The premise of advertising funded businessAdvertising isn’t badIt’s worked well for many businesses for many years : e.g. newspapers, TV
Simple because catch allIn reality want targeting
Want person to notice the ad (and probably click on it)Without negatively impacting the experience the user actually wanted – to use the app and be entertained, informed or get something done
When a break in flow may be appropriateYou’re saying “hey you may want to do this instead” – that isn’t why they opened the app isn’t it?When user may want to break from what they’re doing : leaving anyway, at the end of a task
Harder to ignoreMore options to do somethingHigher CTRRich media is good here
can be blocked – affects some platforms more than othersCan be blocked at a proxy level too, esp. on WiFi networksCan also be blocked by disabling data connection while playing/usingCan take up valuable screen real estate – matters more on smaller devicesAnecdotal evidence that in some markets/cultures ad supported apps are seen in a negative light due to the data/bandwidth costs of serving all the ads
Higher eCPM != higher revenue – need highly target ads to get the higher rate and unlikely to eb able ot show as many of themDedvelopereconomics survey - those who obses about eCPM and fill rate ended up with the lowest overall return. There are more important things to worry about.
Slightly better returnDon’t waste the opportunity – cross promotionA fallacy? – can multiple networks be as integrated as well?
Be smart about how you target your ads.On web, one womens clothing company changed ads based on the weather of the place where viewer was from and saw 600% sales boost.
If you have a targeted audience then may be more appropriate and pay better than generic ads
Potentially higher return and more controlIf have a targeted audience.
Sell the advertising once+ sponsored contentMatch brand values and targeted demographics
Provide for and monetise all9 Tips for Indie Game Developers I Learned at GDC 2013 (David Silverman)http://gamedev.tutsplus.com/articles/roundups/9-tips-for-indie-developers-i-learned-at-gdc-2013/Refer back to piracy?
Average downloads – out of 2 millionhttp://www.lukew.com/ff/entry.asp?1737
5 in a millionSo much harder than where’s wally
SEO marketplace/app store – web – youtube
Anon – various sources: not sure of original
Have a strategyKnow the marketplace rulesApple won’t let you incentivize installs
Not from app store promotion – leads to spikes in downloads at bestHigh in charts more likely to get thisNeed continual promotion to get continual high downloads (or go viral)
Banner ads in simplest form
success breeds successthink brand not appmonitise the brandangry birds the best example of thisclothes | toys | magazines | films | cartoons | every product you can think ofMore royalties from licensing
Battle Bears – from SkyVu entertainmentBuilt the game first but had the intention to create the cartoon right from the start and with that comes further merchandising options
"The Doodler has made cameo appearances in several other iPhone games, such as Parachute Panic, The Creeps, Finger Physics and Pocket God, just like the Pocket God Pygmies are playable in Doodle Jump." CROSS PROMOTION
Build on successOr stand on the shoulders of giants