How To Make Money With An App In 2024

Can Apps Make Millions?

The mobile app landscape has witnessed significant activity in recent years, driven by increased convenience and a wide range of functionalities and entertainment offerings. In today’s scenario, numerous brands launch personalized mobile apps to enhance client services. The app reach has recently surpassed over 5 million on the app stores of Android and IOS. While some apps outperform others, the question remains: how much money does an app with 100k downloads make? Our blog has the answer.

Within our article, we delve into various factors such as your app category, monetization strategy, chosen app platform, and more. If you’re contemplating the development of a money-making app, explore our article for the most accurate insights and understand the revenue from different apps.

How Much Can You Make From Creating An App On Android And IOS- A Comparative Analysis

As per Statista, the Android operating system takes the lead with a substantial 70.5% market share, whereas iOS holds approximately 28.8% of the mobile market. However, the landscape undergoes a significant shift when discovering individual regions.

The selection of your mobile app’s operating system has a significant impact on the revenue potential, primarily due to the contrasting market shares of iOS and Android.

The affordability of the Android operating system is a contributing factor to its popularity. Its open-source nature and lower development costs attract a larger user base generating huge revenue from these apps. In contrast, iOS app development cost attracts a  wealthy user base and is renowned for its premium features. Therefore, the financial capacity of your target audience becomes a pivotal factor in choosing between Android and iOS. Android is well-suited for generic mobile apps, whereas iOS is the preferred choice for intricate, feature-rich applications.

How Do App Makers Make Money- App Revenue Models

Exploring advertisements and collaborating with affiliates are among the various methods to make money from phone apps and expand their reach to a broader audience. Let’s discuss some of the popular app revenue models.

1. In-App Advertising:

The most commonly utilized app revenue model involves earning money through a mobile app, especially suitable for free-to-download apps.

How can I make money with an app? With this model, revenue can be generated through various ad formats like banners, text, and video, using methods such as cost per click, cost per view, and cost per install. Social apps including Facebook and Twitter and gaming apps like Candy Crush and PUBG Mobile, purchase this model to boost their mobile app revenue.

Implementing this model is relatively straightforward, with low upfront costs, enabling efficient scaling of your app while poor ad quality may lead to user disconnection.

2. Freemium:

The freemium model has gained popularity among app entrepreneurs, allowing users to access the basic version of the app for free while requiring payment to unlock additional features or content. In-app purchases become the primary income source, offering add-ons or subscriptions for features like ad-free content or premium analysis. Brands like Spotify, Tinder, and Zoom adopt this revenue model. This app attracts a large user base, serving as a significant source of app revenue if the app is engaging. However, the low conversion rates make it challenging to convert free users into paid subscribers, and so contributes towards potential negative user experiences.

3. Subscription:

The subscription model involves users purchasing the app with all its features, providing a conventional way to make money with phone apps. Also known as the paid app model, it allows charging users a recurring fee for access. Prominent brands like Netflix, Spotify, and Amazon Prime use this subscription-based app revenue model. A consistent revenue stream and recurring payments help build a loyal customer base so it is easy to predict how much money an app can make.

4. Donations:

The donation-based app revenue model relies on users donating money to support the app, often used by NGOs and open-source projects like Wikipedia. Low upfront costs for winning revenues and an opportunity to build a community of supporters. However, the app has difficulty raising enough money to sustain itself, and finding an app idea suitable for this model can be challenging.

5. Sponsorship:

The sponsorship model involves partnering with a brand to promote their products and services through your app. Apps like Waze and Accuweather use this as their primary revenue stream. It is an excellent way to generate revenues without impacting the user experience. However, difficult to secure sponsorship without a substantial user base, and the model can be expensive to implement in reality.

6. In-App Purchases:

With just 5% of users opting for in-app purchases, this approach might appear limited, but that’s far from reality. In 2020, in-app purchases aggregated a staggering $72.3 billion in spending in the App Store alone. This strategy allows users to pay for extra features, content, or services within an app, providing businesses with a reliable income stream. The key to how much can you make from an app lies in maintaining app functionality while offering enticing bonuses, and features for reasonable fees. In-app purchases can include in-app currency and upgrades.

Now, the most recurring question is how do app makers make money from this app?

In-app purchases are suitable for mobile apps that already provide engaging services without requiring additional spending. The key is to enhance the application’s appeal with these purchases without compromising its functionality.

7. Pay-Per-Download:

The most traditional method of generating revenue from apps involves selling your application on the Android and iOS marketplaces for a specified amount. Upon purchasing the app, users gain unlimited access to all its features. Despite being a simple strategy, pay-per-download is considered outdated for app monetization. Firstly, the competition from free apps is exceedingly high, complicating marketing efforts. Secondly, users expect a distinctive value proposition when paying for an app. The pay-per-download model is suitable for B2B services offering unique business values, particularly for niche audiences. Interested users can consider providing a free trial period with some or all features to explore the genuine potential of your product.

8. Data Licensing:

Data monetization or licensing involves selling user data to third parties. To meet the industry standards, it is essential to safeguard user privacy. This approach enables developers to keep affordable prices on their mobile apps while ensuring a high-quality user experience. User data has details such as age, location, purchase history, interests, and occupation. Data licensing emerges as a viable method to generate income for applications with a substantial user base, typically starting from at least 50,000 active users. Businesses can make use of the accumulated data to establish a steady cash flow.

When implementing this strategy, it’s crucial to adhere to data protection laws in your region. Ensure that data collection only takes place with explicit consent from the user. Additionally, consider employing App Store Optimization (ASO) techniques to enhance your app’s ranking in app stores.

9. Transaction Fees:

The transaction fees model provides businesses with another opportunity to offer a free application to end users. With this model, the app owner receives a commission each time a transaction takes place. For instance, when a user orders groceries through an app, they incur delivery fees that contribute to the app’s revenue. This approach allows app developers to deliver excellent services without directly billing users for their solutions. Businesses should hire proficient app developers to safely and efficiently integrate the system.

10. Affiliate Marketing

Affiliate marketing involves a personalized product link and a reward system. Companies offer commission fees to partners for every user acquired through the product link. This method is commonly employed in blogging and enables smaller creators to earn income.

This approach applies to any type of application, serving as an ideal method to enhance brand awareness and broaden the user base. Affiliate marketing can be effectively utilized for productivity, wellness, lifestyle, gaming, and various other social apps. When seeking potential affiliates, ensure that their values align with yours. In a sense, they become the faces of your brand, making it crucial that they represent your vision.

Top App Categories That Can Help You Increase Your Mobile Revenue

Can I make money with an app?

Yet, each app category possesses a distinct user base that influences its potential for earnings. Traditionally, gaming apps outperform other categories in terms of revenue, but the landscape is evolving rapidly. The revenue of non-gaming applications is anticipated to surpass that of gaming apps soon. Let’s delve into how these apps contribute towards generating revenue and the associated app development costs.

• GAMING APPLICATIONS: The gaming market is experiencing remarkable growth worldwide. The advancement in mobile technologies delivers immersive gaming experiences and dynamic gameplay. Projections indicate that the global mobile gaming market will surpass billions by 2025. The rising popularity of gaming applications is driving consumer spending on mobile gaming apps.
• ENTERTAINMENT APPLICATIONS: The advent of live-streaming technologies has significantly elevated the popularity of entertainment apps. Due to the Covid-19-induced lockdown, streaming hours increased by 32% in 2021 compared to the previous year. So, how much revenue can a mobile app generate in these augmented reality game applications?

In-app purchases remain the most prevalent source of revenue for entertainment apps, encompassing subscriptions, virtual gifts, and extended watch hours. The revenue model of entertainment apps is expected to undergo further evolution. While AR app development services remain the primary method for generating revenue, alternative models such as advertising and sponsorships are gaining increasing popularity.

• HEALTH AND FITNESS APPLICATIONS: The emergence of Covid-19 sparked a significant surge in the demand for health and fitness apps. In 2019, global installations for health apps were at 1.97 billion—a figure that impressively climbed to 2.48 billion in 2021, fueled by the impact of the pandemic. While the grip of the pandemic lessens and lockdowns ease, the popularity of home fitness continues and so did the fitness app development costs. The recognition of the importance of work-life balance and the pursuit of preventive health measures continue to drive the sustained growth of home fitness trends. The projected market size of health and fitness apps is set to reach an impressive $24 billion by 2026.

• E-COMMERCE APPS: Considering this app category is a promising way to boost mobile app revenue, given its anticipated rapid growth in the future. Undoubtedly, it stands out as one of the most popular mobile app categories, primarily due to its robust revenue-generating capabilities. In-app purchases emerge as the favored revenue model for this app category. Additionally, consumer spending on e-commerce and mobile shopping apps is on a significant rise.

EXAMPLES OF REAL-WORLD MONEY MAKING APPS

1. INSTAGRAM
2. TINDER
3. SPOTIFY
4. ZOOM
5. FACE RECOGNITION APPS– FACEFIRST, FACE2GENE
6. APPS LIKE OMEGLE- AZAR, TOPFACE

CONCLUSION

This article has provided you with valuable insights into how apps make money. Crucially, having an app development partner to navigate and support you throughout this journey is essential. Prioritizing quality, excellence, and meeting customer expectations can significantly enhance your mobile app revenue.

FREQUENTLY ASKED QUESTIONS

Q1: How Much Can You Make By Owning An App?

Experimenting with various approaches can enhance your mobile app revenue. Initially, it’s crucial to select an appropriate app revenue model that aligns with your app’s niche and attracts users. Furthermore, providing a range of monetization options and implementing a blend of different revenue models, combined with promotions and marketing efforts, is essential to boost the visibility and viability of your app. For example, introducing time-limited discounts can attract more users to utilize your app, thus increasing your earning potential.

Q2: Can I Actually Make Money From Apps?

Absolutely!

In-app advertisements, affiliate marketing, and sponsorships stand out as effective revenue models for your app and much-encouraged money-making strategies for your free apps. These mobile app revenue models enable you to generate income without directly charging your target audience.