The app market is evolving - and so are its business models. Here, Softtalkmobile examines the options.
Although the mobile app market is well into billions of downloads each year it is still relatively immature. Immature because it has so much further to go.
According to industry analysts Gartner, there were 8.2 billion downloads from app stores in 2010 and as 2014 draws to a close it says the figure is projected to be 185 billion downloads.
This figure is so large it’s hard to conceptualise. Clearly though, monetisation opportunities are going to grow in tandem. When it comes to monetising your app, we believe there are several tactics that you can adopt. Each offers a different opportunity, yet you can use one of them or all of them.
The first one is direct sales on an app store. As you know, you put your app on the store, do some marketing around it, charge a fee for each download and sit back and watch the sales figures climb and the money roll in.
Well, that’s the theory and for some developers this approach works very well.
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Sponsorship is another approach and one worth pursuing. Your app, for example, could be offered for free while you receive an instant contribution for development costs and ensure a profit – even before you’ve launched.
In return, you provide your sponsor with branding opportunities on your app. This is a relatively new approach but one that is certain to gather momentum as the number of app downloads increases and the market matures.
Another form of advertising is embedding small banner ads and other types of advertising into your app. These forms of advertising are fairly easy to accommodate. All you need to do is choose the ad network or networks that suits your mobile app. There are a lot of ad networks to choose from such as AdMob, BuzzCity and Madhouse in the Far East. These networks have different areas of global coverage so in theory you can appeal to a very broad, global market.
Micropayment is another model that is rapidly gaining ground because it’s one of the best ways of adding an extra revenue stream to your app. If you’re producing a game you can sell extra levels or game play extras. If you’re publishing some form of title, you can sell subscriptions to magazines or other services.
Lite apps are a clear winner and are a very sensible way to get your app into the public domain. Because the Lite version is free it’s very enticing for a curious user, and it doesn’t cost them anything to download. If they like it, they pay for the full version, tell their friends and the app becomes popular.
As the market matures we’re likely to see more models emerging or existing ones, such as sponsorship, gaining more ground. In parallel with this we’re also likely to see app store dominance begin to fracture, with users going to lots of different app stores as a wide range of new devices, that are not proprietary, enter the market place.
And it will be the app stores that offer cross-platform usage for software that are likely to be more successful.
Mirroring this, there are also business models that are yet to surface that will enable this. For example, you’ll buy software for one device and included in the price will be the facility to also download to another device. But this is some way off yet.
* This blog post is written by Softtalkmobile, and is sponsored by the Intel AppUp developer program, a single channel for distributing apps to multiple devices, multiple operating systems, and multiple app stores.
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