Is it worth monetising an app or not?

When considering having an app developed for your business, one of the more frequently asked questions or contested topics is whether or not it is worth commercialising an app or keeping it free (at least for a limited time). This is because of the fact that whilst an app is an investment in a marketing tool it may also be a good opportunity to have an additional source of income, especially if it is a massively sought after app. For instance, there are plenty of mobile gaming apps that are developed purely to make money whereas something like the Facebook app is just to give customers an additional way to reach out and a decent functionality that is so vitally important in ensuring the future of a particular brand. Accessibility and the social media aspect of apps are huge in the market nowadays, but the question is: do I monetise an app or not?

There really are varying answers to this question and some will be right, wrong or somewhere in-between. There are certain apps that could never make money as they are just for convenience and not really all that important, whereas some apps have made tens of thousands of pounds through repeat downloads as they are massively desirable and customers are lining up to pay for them. However, evaluating which particular features or companies are able to commercialise an app is quite difficult and will often take a lot of market research asking customers if they would be prepared to pay for such an app. For this reason, it is vital that you read on to see a different insight and viewpoint on the app world and whether certain apps can be monetised and others cannot, because there are so many different reasons to suggest either way.

The first thing to consider when looking to monetise an app is what your competitors are doing. There is little to no point in offering an app that costs money when competing with 10 apps of similar functionality that are completely free. Without a reasonable niche or selling point an app that costs money vs. a free app can never hope to succeed. For instance, in the battle of Instagram vs. Snapchat neither of these products has any particular source of income from the Android or Apple stores. This is because of the fact that they both are almost the same and offer massively similar functions, and therefore monetising an app through purchase would cause one to soar massively in the market than the other. For this reason, both of these global entities make the majority of their money through advertising instead, which means that customers can enjoy their free service and let their market and target audience grow exponentially without any interruptions. Their current situations are too good to be true and for that reason there is no need to change. The same could be said for supermarket shopping apps, social media apps as well as many more.

An additional constraint for monetising an app is whether any customers at all would actually make the effort to pay for it. For something as trivial as a local taxi company consumers are far less likely to pay for an app which they may use barely ever especially given the likelihood of competitors, whereas organisations such as a gaming company with a top quality and designed app can easily sell it to aspiring and avid video gamers. Considering the amount of money that certain individuals spend on console and computer games it isn't much of a stretch for them to consider a gaming app, and therefore specifically designed games can look to turn a profit by having a production cost and an end goal without taking into account any other mediums such as advertising. This is a very viable ploy as with the right app and the right USP it can be very easy to harness the needs of individuals, and this is also coupled with word of mouth through social media and other outlets, as this in turn gives the consumer the opportunity to further the brand through recommending it to friends and family. This means that you can effortlessly grow your business and income for your app and be very successful in the field.

The final and probably by far the best way to monetise an app if you can do it and make it desirable enough is through mini-transactions. As much as most apps are an up-front one-off payment some apps actually are designed to pull you in with a "free" app and get the money out of you through the purchase of additional perks or tweaks, usually through a game. This has been done previously from a lot of entities to buy power-ups and skip levels on computer games (for example League of Legends is a free client-based game but in order to level up more quickly and unlock more champions/skins for these champions payment is required that a lot of gamers are more than happy to pay. This may begin with just a single transaction for that one particular champion that you want, but eventually these costs add up and before long you have an exponential amount of money spent, all whilst being branded as a free game. This is something that almost every single League of Legends player will consider, and from personal experience I can suggest that it is very easy to get hooked on mini-transactions the more you play a game and have a desire to unlock new content. The easiest comparison to give would be if you are investing in a particular brand of car. The more you buy this type of car the more you will appreciate it and desire later models and perks such as new suspension or colour schemes, and so eventually you can spend a lot of money on a product that was working just fine in the first place. These mini-transactions are driving a lot of markets besides apps, but in apps is where they truly excel.

For instance, the recent Despicable Me film franchise has spawned the creation of a lot of "minion"-based apps (one of the many characters from the film). This has meant that these games have charged mini-transactions for new upgrades and skipping levels and other such things so that customers are inclined to pay money to complete the game faster or to get as much out of the game as possible. As much as we'd like to think we can stick to limited content there is always a desire to do more, and another example of a gaming app that does this is the Hearthstone app for the Ipad. This game is a card game to which you start with very few cards, and the only way to get new cards is by either purchasing packs of cards directly or by purchasing access to a certain gain type which gives varying rewards, including these packs. The only other way to do this is through tedious game play of regular game types or certain daily quests that give bonus gold for packs, and so for those that do not have a lot of spare time or who can't be bothered waiting buying these packs doesn't seem like too much of a big deal. To pay for £10 worth of cards when collecting the gold would take several hours for a lot of people this is well worth it to get enjoyment out of a game. For this reason Hearthstone has grown beyond recognition over the past year or so, and is now looking to develop Android and IOS apps too so that customers can enjoy the advantage of having a more convenient app as well as being able to spend more money on these particular mini-transactions. It isn't exactly difficult for a customer to suddenly spend an incredible amount of money with these sorts of games, and so if you find a desirable enough mini-transaction method you are onto a goldmine for an app idea.

To conclude, monetising an app is the most desirable and sought after option for anybody looking for disposable income. However, as an established brand making this app for convenience it is unlikely to be a good idea to monetise it, as having a free app that makes your service easier to use will give customers a good reason to repeat purchase, giving you income from a general sales-based source rather than anything else. This is optimal for a lot of companies especially those that are smaller, as with certain competitors with no apps brand loyalty and increased income is established very quickly.

At Discount Domains we develop a lot of different apps for our customers for most platforms, although the most recommended and essential ones that we will recommend are obviously for the Android and IOS devices as they are the most popular. If you have an idea for a good app and think you can monetise it efficiently or think that it is better to provide it for free then you should definitely contact us and ask for a member of our app development team who can assist you in providing a bespoke product with precisely the functionality that you want in order to give you an increased revenue and profit margin. You can contact us by calling our main office on 01952 898701 or submitting an enquiry form about our apps here in order to get yourself a no-obligation quote for your new app. We look forward to hearing from you shortly and will provide the correct solution for you.