How to actually make money from your app
Thursday, June 9, 2016/
By Sebastian Pedavoli
Contrary to popular belief, it’s unlikely that you’ll become an instant millionaire by developing a mobile app.
Think about it this way: There are about 1.5 million apps on the iOS App Store, and while there were about 156 billion downloads last year, only a quarter of those were actually opened once downloaded.
Adding to the fuel is the fact that most apps are free to purchase – the average cost of an app is about $1, and only 10% of all apps are actually paid for.
So as a developer how do you make a buck in this environment?
We are seeing more and more developers find alternate ways to make money from apps. Some turning to advertisements, others off-selling consumer details to third party providers and most commonly, in-app purchases, where developers hope consumers get so hooked to the app that they are willing to pay for more features or add-ons.
But it’s really not getting any easier. Gartner estimates that only 1% of apps are actually financial successes and by 2018, this will whittle down to 0.01%.
That’s why making app development sustainable is more important than ever. Especially for independent app developers who are the ones that really struggle to make any money from app development.
So if you are thinking about developing an app, here’s a few things to consider to ensure you’re not spending endless hours and money on an app that’s only going to get a handful of users.
Find your niche
The most popular apps backed by big brands like Google and Facebook have strong holds on their respective markets.
Don’t compete with them for the Swiss Army Knife of apps — find a niche area that you’re passionate about and focus on it. You can also reuse the same utility or framework over and over again to create another app if you focus on one niche.
That way you’re not starting from scratch each time you want to develop an app.
Design, build and get it out fast
Make sure you get your app out the door fast. Don’t spend months building something to only find there is no demand for it.
Remember you can always update, refine and add new features once you have a better understanding of user adoption, so don’t try to bake everything into the app on the first run.
Get it out as soon as possible and spend as little time and money as you can on creating the app, at least until you know how successful it will be.
Use popular back-end web services
There’s lots to think about when developing an app beyond just writing the code to make the app work.
You also need to maintain the app so you don’t experience something like a server failure thanks to heavy traffic, which can take down your app and hugely impact on the user experience. That’s where off-the-shelf back-end web services like CloudKit can help.
Rely on a third party provider to get networking functionality with minimal work, so you can focus on the actual build of the app.
Monitor adoption rates
Once you have an app up and running, closely monitor how much traction your app is actually getting. Don’t just look at download rates but open and use rates as well. Are users only interacting with the app once and then discarding? If you’re offering in-app purchases, are users buying them?
If it’s tracking well, then you might want to invest a bit more time into adding or refining features. If not, you need to assess whether it makes sense to keep investing in the app or if it’s time to back out.
The key to remember is that today, consumers are so use to downloading mobile apps for free the thought of paying any more than a few dollars is absurd.
And while this is great for consumers, unless you are the likes of Google, Facebook or Kim Kardashian — with a huge development team and branding behind you — you’ll likely struggle to make it big through app development.
So be realistic when approaching app development.
Understand it’s not as easy as some may make it out to be, to make money. Know what’s already out there and don’t spend huge amounts of time and effort until you know it will be a success.
As it becomes even easier for almost anyone to create apps it will only become increasingly harder to make any money.
That’s why sustainable app development is so important — it is possible but it requires dedication and nous to get right.
Sebastian Pedavoli is the co-founder and creative director of Proxima.
Amantha Imber runs a successful business — but she still has impostor syndrome Amantha Imber Inventium founder
Social media isn't about numbers, it's about connection Carlii Lyon Carlii Lyon PR founder
"My early decisions were rooted in fear": How good hires can set small business owners free Nancy Youssef Classic Finance founder
"No staff turnover": Business success hinges on a thriving company culture David Fazio Mate co-founder
Five ways to mentally prepare for the brutal capital-raising process Stacey Fisher Minnow Designs co-owner
In the age of online shopping, it's retail staff that make or break businesses Cal Doggett Properties & Pathways director