Four ways to make your startup’s app profitable in just one month
Monday, January 25, 2016/
I have a lot of people come to me very excited about their app ideas and how they will change their respective industry.
They’ve rarely thought about how the app will make money, and that’s not necessarily a bad thing. I’m more interested in working with the visionaries than working with people after a cash grab.
But building and marketing an app is expensive and most people hope to see some revenue coming from it after launch. The problem is that app users are becoming increasingly demanding about what they’ll put up with in the way of monetisation schemes.
Consumers don’t like paying for apps before they’ve even had a chance to trial it, and they have zero tolerance for anything that disrupts the user experience once they’re in there.
You need to be pretty creative to get your app to make profits these days. Ideally your monetisation model will have been ingrained into your app’s architecture – a key part of app design and marketing strategy, not an afterthought.
Here are my top four tips for ensuring your app breaks even within one month of launch
1. Start marketing at least three months before launch
Without marketing, your app will fail.
Start generating buzz both online and offline so that when you launch your app to the app store, it won’t be to crickets.
- Set up a website or landing page so people can find more information about you
- Create social media pages and interact with people online
- Collect email addresses of people to notify when your app is launched
- Create and share your own content, and share relevant external content you’ve curated that would be interesting for your audience.
- Attend meetup events and don’t be afraid to talk about your idea
- If your target market uses any online forums or LinkedIn groups, make sure you build up a presence there
2. Set up sophisticated app analytics and monitor user behaviour
You can’t improve what you don’t measure.
Choose an app analytics platform and set up some goals for what you want to know. Data on user behaviour is invaluable for pinpointing where your app can be optimised. You’ll quickly notice any patterns emerging that are impacting revenue, for example:
- What screen do users exit from the most often? Where can funnels be optimised for higher conversions?
- Are users more likely to click on ads shown at night or in the morning, at the start of the session or at the end?
- Are users acquired through Facebook less profitable than those acquired through Instagram? If so, you can redistribute your budget accordingly so you’re attracting the highest value users possible
3. Hit the publicity circuit
Increasing your app’s number of downloads is a sure-fire way to make cash quickly.
Publicity is organic and credible social proof that can have an enormous effect on your downloads. Before you launch your app, put together a media list of people to reach out to and let them know you’re about to go live.
Make sure you also let any key influencers like bloggers and app reviewers know that you’ve launched and ask them for their thoughts.
Keep an eye out for any awards you’re eligible to enter as well. Even if you don’t win, just being listed as a participant or finalist is good exposure.
4. Increase customer lifetime value
You’ve probably heard that it costs five times more to acquire a new customer than to engage an existing one. It therefore makes sense that one of the best ways to increase profit margins is simply to squeeze more value out of your existing users.
- Run a referral program or incentivised sharing scheme within your app and social media to attract users’ friends
- Run competitions
- Offer personalised content relevant to their interests and goals for using your app
- Set up targeted push notifications
You can also offer different levels of purchase options to cater to every app user.
- Upselling by prompting them to purchase a more expensive, premium product after they have indicated interest in your main product. For example, paying to unlock ‘exclusive app features’.
- Downselling by offering a slightly cheaper, introductory product to users who you have identified as reluctant to convert. For example, a one month discounted trial before committing to the yearly subscription.
- Cross-selling by looking at what users have purchased (or ads they’ve converted on if you use in-app ads) and prompting them to purchase related or complementary products that they might find valuable.
Focus on these four ‘low-hanging fruits’ to have the biggest impact on your bottom line in that first crucial month. Above all, this month is a learning curve where you can test which activities make a difference and which don’t, so you can use this knowledge to fuel future initiatives.
Test, measure and reiterate to ensure profitability for years to come.
Logan Merrick is the co-founder and director of Buzinga App Development. You can download his free startup guide to app development here.