How Do Free Apps Make Money? [2021 Trends]

Have you ever wondered how to make money-free applications? Do you know how do free apps make money?

Most of the time, downloading an app from the store and just start using it. Naturally, developers offering applications for free payment expect otherwise. If you are thinking about developing an application and you are not sure how a free application brings benefits, the following article provides clarification on earning money.

Top 25% of iOS developers and the top 16% of Android developers more than $ 5,000 per month with free apps.

Using the above numbers as a rough guide, it can be said that almost 20% of the applications in the market are very good, 30% of the applications are well and half of all applications are a real waste, sometimes it is not even worth your attention. However, your monetization strategy on app purchases should be on point.

Some Useful App Monetisation Methods

When as a developer you launch your mobile application in the app market or google play store you wish to make money. Here are some of the ways through which you can monetize your app:

1. Advertising

The ads are pretty self-explanatory.
If you have a website, you understand how ads work.
It is the same concept for implementation.
You pay them based on impressions or clicks.
The type of ads featuring on its platform will affect the rate of pay as well.
For example, you can charge companies for a video ad instead of a static ad or banner.
Advertising works for some models and applications.
You have to decide whether this is a reasonable strategy for you to consider after analyzing its users and competitors.
Advertising strategies are listed below :

1. Banner Ads

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Usually, they are embedded in a web page or application. Banners are often on the images, text no. The main idea of ​​this type of ad is to attract users on page host to the advertiser’s website, page or application.

2. Native Ads

Image Credits : bucksense.com
Native ads in nature are very close to the flags, but they are less obvious to be treated as direct advertising content. These ads are designed to blend with the natural environment and mobile being perceived as part of the application, not another banner ad.

3. Video Ads

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Video ads are the simple video ads that you see during accessing the app. the video could be related to anything, a game, an offer or a link to another video.

2. In-app Purchases

An in-app purchase gives extra offers and benefits to the users in order to attract more of it.
These upgrades help increase user engagement and user experience.
Take a look at how much money the average user spends each month on google play.

Most mobile users do not buy upgrades. It is also clear that iOS platform users are willing to spend more than Android users.

So you can not expect every person who downloads their app for free to spend money. That’s not a realistic or achievable goal.

So one has to focus on the group is willing to buy those upgrades. These additional features can add a layer of complexity depending on the nature of the application and the depth of its functionality. You have to find a way to connect the user and keep them coming back for more.

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Example : Candy Crush icon IAP is a great example of visually explain what is contained in a package of IAP. Promoting a purchase application that brings multiple benefits on a “premium” or purchase “package” makes no sense since users can not be expected to know what sensibly could be included in this type of purchase until they can use the application. Candy Crush also goes a step further by using numbers to describe the different amounts of multiple individual benefits included in the PAI — a great touch and one that aligns well with the description.

3. Subscriptions

If your application is suitable for a subscription model, this can also help with making money. You should make it a paid version.
If there are fitness routines in your app, you can provide more specific training for users subscribed. Or if you stream video or music, subscribers can get better quality or more playback options.

If you create content and share in your application, you may allow subscribers to access new content sooner than free users.

Finally, your application can offer campaigns, coupons or discounts to their subscribers for a small fee.

Your income would be in parallel with the number of subscribers, and therefore predictable.

Therefore, this is the option available apart from in-app purchases and advertising revenue, which may be more unpredictable fits.

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Example : Amazon Prime is a membership program that you and your family give unlimited fast shipping, such as free shipping two days street addresses in the contiguous US, on all eligible purchases for an annual fee of $ 79. Amazon Prime members in the US You can enjoy instant videos: unlimited streaming without commercials instant thousands of movies and TV shows through Amazon Instant Video at no additional cost.

4. Referral Marketing

According to the survey conducted by the New York Times, it was found that 65% of all new business comes from referrals. Know your target audience and go for referral marketing,
That means that, on average, two-thirds of consumers make purchases because they know someone recommends a particular product or service.

Referral marketing is to provide a product or service through business from existing customers, rather than traditional advertising.
This form of marketing can be highly effective in an online environment because of the popularity of social media and sharing sites. Internet referral marketing can potentially spread faster and to a wider audience than most offline marketing strategies.

Example : Airbnb references are the best in the world and analysts have reasons why they said it. Airbnb learned and improved every step of this technique and master the art. What they offer is an incentive program 2-way for users. This means that the sender and recipient are eligible for a credit of twenty-five dollars after the receiver completes its maiden voyage. The sender is also entitled to seventy-five dollars once someone guests receivers. The program is available to users.

5. Merchandising

E-commerce companies use free applications for the sale of physical goods or merchandise such as branded toys, shirts, cell phone cases, etc. through email marketing or specially developed applications.

One of the first and most successful applications to increase revenue from branded merchandise was the angry birds game brand.

Merchandising is really helpful when it comes to free apps. This is a great way for free apps to generate money.

This will help your free app to make money.

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Example : eBay is one of the best examples of selling merchandise. Use your application to enter at any time to look for discounts on your favorite brands, or to sell on the road. eBay application allows you to take the market with you — manage your account or bid at auction from wherever you are. Find offers ranging from the latest fashion DIY items for home and garden furniture. Create your own list to sell clothes, electronics, appliances, and automobiles in seconds.

6. Collecting And Selling Data

This is probably the most widespread and ethical way of monetizing applications, but the collection and sale of personal data remain one of the effective approaches to get some benefit.
Some companies that offer free mobile applications sell their databases to third parties.

The information may contain user address email, social networking accounts, and personal preferences.

Applications generate a lot of data in terms of user behavior, which is highly desired by those who are in different fields of research.
So application developers can sell this information to researchers and do quite a good money back. There are actually two ways to win in selling data: tracking what users do and sell the data to outside companies or use the raw data itself for its own purposes.

From the point of view of marketing, companies want to pay to show ads to the most relevant audience possible; while on the other hand, so far not every service can collect the same data as Facebook or Google does. However, if your application is able to collect relevant data, then you may have a way to capitalize on it.

7. Freemium Sell

Freemium apps have a great response today. It has got a lot of attention from the market as well.

Apps that are free to download catch people’s attention. People when experience something different in your app they would definitely wanna come back.

Here you as an app developer can be opportunistic. This advantage of your users visiting your app regularly can be of great use.

You can add some features of your app that are payable. And with the prior experience of users, they would definitely want to unlock some extra features.
Some video streaming apps are using this strategy today. They let their users stream some videos for free. Thereafter, the users are charged to have access to some other trending videos.

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Example : Dropbox, the storage platform in the popular cloud offers a free plan for up to 2 GB of space for backup and simple file sharing. The Pro plan for a significantly greater amount of space (1TB) is only $ 9.99 per month. Dropbox freemium approach is to allow users to see how easy it is to backup and share your files via the Dropbox platform. This approach works, because they allow you to backup from anywhere, including your mobile device. And anyone with photos and videos you can say that 2GB of space will never be enough. A $ 9.99 per month, you can not really go wrong.

8. Transaction Fees

It is one of the best ways to make money. These apps charge fees for every transaction that happens on their platform.

When you allow third parties to sell their products on your app you can charge a minimal amount from them. For every shopper that they gain, you can charge a certain amount from them.

Some amount of money can also be charged from the users or say, shoppers. Since it’s because of your app, they have been able to find what they were looking for.

9. Crowdfunding

It is difficult to deal with a situation where you see your app not making money despite all the efforts and resources you have put in. Your app might be existing on the app store or play store, but not necessary that it has the number of downloads you want.

What should be done when you encounter such a situation?
Getting it funded is the answer to this question. Getting it funded is the key to reduce the risks.
It should not be that you get your app funded entirely. It could be that a part of your app needs funding or say a specific feature of your app needs to be funded.
If you have a great network or a great community then getting your app funded could be easy.
We listed the best monetization methods that you can opt for.

How Do Free Apps Make Money Without Adds?

There are more ways to make money other than your mobile app ads only. There are other ways through which free mobile apps make money,
Many app developers turn to ads to monetize their applications. In fact, it is expected that investment in mobile advertising in the US will increase from $ 58.4 billion in 2017 to $ 70 billion in 2018.

However, ads within the application are not always the best strategy for monetizing applications.

App makers today have come up with many other strategies other than ads for monetizing an app. It is not always necessary that ads are always acquirable.

We have listed some strategies here to let you know that there are a lot of other monetizing strategies other than in-app ads and video ads.

How Do Free Apps Earn Money On The Play Store?

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The most direct way to make money from the Google Play Store would sell its implementation, no doubt about it. App offer on the app store.
However, if you want users to prefer their application freer alternative payment, will have to offer a much better service than those.
If you can get users to prefer their payment application then you have found the most direct way to make money from your application. However, it is not always easy to succeed with payment applications.

You will be directed to a very specific niche and offer the best solution there. If you can not solve a very specific problem of your target audience, and do it the best way compared to others trying users will not be too likely to choose your application.

It can also be good to know that iOS users are more inclined to buy paid applications compared to Android users.

Wrapped Up

The decision of choosing strategy solely lies on the user. We at Echo innovate IT can help you with development of your free apps.
We have a team of developers that can help you with development of your free app and suggest the best monetizing strategy. You can take help from the team of our developers and have your say as well. Get your app done. Contact Us Today!