You probably cannot imagine leaving home without your smart phone. You are living in an age where everyone is bound to have a mobile phone and you may drop by a lot of people carrying smart phones – the pocket-sized devices that are perhaps more efficient than computers designed to send men to the moon.
Today, we want more than just communicating devices. There is a huge demand for cool apps and rich-featured smart phones.
An app or application is a type of computer software that is designed to perform single or multiple tasks. Apps are made in various programming languages and are intended to be used on your computer, through the internet, or on mobile phones or electronic devices. Few years back, there was too much hype about the dot-com era but that was only the onset of electronic commerce. This market of ecommerce is expected to grow substantially in a couple of years and so will the applications market.
Despite three decades of evolution in mobile phone apps, games still tend to be the most popular category of smart phones and feature phones. Besides that, all other categories of applications are getting common in use on smart phones as opposed to feature phones and this difference gets even more pronounced when navigations or Maps are used that require better computing power, touch screen interfaces for a wholesome experience.
In terms of individual apps, Facebook is an unbeatable winner in all smart phone operating systems. However, irrespective of the operating system, the popular ones are the most frequently used applications. Twitter on the other hand appears to be among the top five only on blackberry maybe because the QWERTY keyboard facilitates typing. YouTube also enjoys its restricted popularity on android operating system.
Research has it that the most popular apps involve games and then comes social networking. Navigation, music, news and entertainment are the categories of the most frequently used applications.
The good news for mobile application developers is that the number of smart phone users is constantly on the rise and they have an edge due to the fact that a wide range of smart phone applications are in demand too. Now the only unsolved block in this mystery is how to take advantage of this great opportunity the midst of so many others challenging apps hitting the market every now and then.
How huge is the apps market?
The shift in computing use from desktop PCs to mobile explains the growing number of mobile application users. So it could be evaluated how big app market is going to get. It is estimated that the mobile application will grow at an incredible rate from $6.8 billion to $25billion worldwide. No matter what investment is done, the number is always huge when it comes to smart phones.
After all, Smart phones are the reason for the rise in apps culture.
The report by Pew Internet and American Life Project declares that 82% of the adults in US use cell phones and 43% of them have apps on their phones. This clearly indicates the growth of cell phone users and hence the demand in the market for new and improved apps. Techies from around the world are busy figuring out what the next application is going to be like and how it can become the biggest seller.
Get the most out of your apps
Ultimately with the increase of smart phones in the last few years, there have been considerable opportunities for various brands and apps developers. When you make an application, it is essential to ensure that it implements all best practices. The following overview provides an insight on how you can make the best out of your applications.
1. Understand the audience
You must be totally aware of the possible buyers and all ways to reach them. Formulate a strategy and measure the percentage of market that could be within your reach with that plan. There is simply no use developing an application for iPhone, for instance when most of the customers are buying blackberry unless your app is good enough to bring a revolution in purchasing trends. By spending your time and money on a mere one or two percent of the market, you are not asking for good return on investment. Therefore, it requires more profound study to understand your target audience.
2. Use the web
Online world is the best platform to spread your message. A developer may also consider using web experience to promote the app. you can display your applications through a website will give you an edge over competitors by providing enhanced market coverage. Once your website URL is sufficiently popularized in search engines, the new apps you place will never go unnoticed.
Indeed, you control the sales of your application by using your own website to display the apps.
3. Promote your apps
App stores are usually the first choice for developers but most of them will not offer the best deal. To have real results and maximizing income, you need to take charge of promoting the application. You may want to use the following ways to promote you apps:
- Contact mobile advertising networks and place text ads
- Devise some search engine marketing campaigns with major search engines like Google, Yahoo and Bing and with the help of some local search engines if the application serves a particular geographic location
- Get your application listed in prominent sites operated by big brands or names
- Embark on social media platforms to create awareness about your app through Facebook, Twitter, Myspace and others
- Use blogs and online forums to spread the message to mobile users
Maximizing revenue with mobile apps
Now, You have invested sufficient efforts in developing a mobile app but it’s worth nothing if you are unable to sell it. You have extended your reach but there is also a need to discover ways to maximize your revenue. Most business owners would simply rely on apps stores to promote their application. However, there are better advertising networks to get you started. All you have to do is place an ad or banner to employ search engine marketing campaign to draw buyers directly to your app. In this section, you will be familiarized with some revenue generating models.
1. Sell at app stores
First of all, you have to ensure that your app gets live on the chosen app store at the precise moment when the customers are willing to download free apps.
You will get a slight bit of extra promotion when you have recently added your app. However, considering the speed at which new applications are added, this benefit may not last long. But you can always refresh your position by releasing recent updates. When you release new ads in the apps store about your application, it will certainly boost your coverage.
Pros: For promoting an application, this is the first and most fruitful model.
Cons: The biggest disadvantage in this case is that app stores don’t happen to be the best place to collect money. You should always look for alternative ways to extend your reach. Some app stores have a tedious payment system and usually the instructions to register for registering on payment accounts are too confusing.
2. Ad funded
Primarily, ad funded apps are easy to download for everyone but are monetarily rewarding only when your app functions well and the ad with it is compelling enough. The end user downloading your application will do it for free but you will be paid for the advertisement that goes along with it. An advertising driven promotion of your app requires measuring who visits your app and evaluate how many of them will download it. This will help you determine the real worth of the application. Apple, Google, InMobi are some of the key players that can provide major ad networks for your application.
Pros: Ad networks are quite promising for those app developers who know how to capitalize this opportunity.
Cons: The biggest drawback of this model is that it takes a lot of time to have sufficient users that can turn up good revenue for you.
3. Affiliate sales
In this form of marketing, one website promotes the products and services of another in exchange for commission. The commission could be let’s say $3 per download of your app. Although, the affiliate industry mainly comprises of big players, small businesses are greatly benefitted from it. In this case, the developer will be paid by the third party whenever he brings a buyer to the third party. For instance, your application supports e-commerce website, you will be paid by the third party (could be an ecommerce website) but the app will be used for free.
Pros: If the application becomes a hit, you can have huge success.
Cons: the drawback is that the commission is limited and the market can soon present another similar application to compete with yours. In this situation, the chances to maximizing revenue from affiliate sales are severely restricted.
4. In app purchase upgrade
What would you prefer of the following: a game that costs you 10 to $20 with all its levels or a free game application where you would have to pay for next levels or additional features? The second concept explains in app purchase upgrade.
This means you have to give away the application for free and wait for the customer to come back for upgrades or additional features. Although it allows easy upgrade options, most of the users are somehow reluctant to get upgrades.
Pros: In-app purchase upgrade can be a real hit for games or applications that gain massive popularity because then the customer would want an upgrade for sure.
Cons: There is a fair amount of risk involved in this type of promotion. Usually, the in app purchase upgrade is not the best model for revenue generation.
5. Upfront app purchase
This is totally the opposite of in app purchase upgrade. If you are selling your application by this method, you will be paid directly by the consumer without the involvement of third party. Apps like games or small utilities are made available to the mass market by this model. The developer gets a low price for each download but this can easily be compensated with a large number of audiences willing to buy the application. The upfront app purchase model appears to be a clear winner when compared with in app purchase upgrade. Most of the people would like to pay an upfront cost for a game rather than buying it in bits and pieces.
Pros: you can have access to a large or un-segmented market through this model.
Cons: The downside to this model is the neck throttling competition for the developers.
6. Niche upfront purchase
Some of the apps cannot be appropriately promoted in the mass market. This means, you will have to find a niche where your sales can be targeted.
Conventionally, the niche market narrows down selection criteria and could provide much value to your app as opposed to the mass market. OmniGraffle for $49.99 or iRa Pro for $899.99 are some of the classic examples of the niche upfront purchase model.
Pros: The model provides ease and convenience of reaching the target customers.
Cons: Since the market is restricted to a niche or a few groups, the buyers are limited.
7. Web application
The applications specifically designed for the web and the users paying for the apps may use other web apps. This model is employed to extend your reach to maximum customers so you may have to distribute your app for free in the beginning.
Pros: Promotion through web apps is a faster means to reach more buyers.
Cons: This would require extra work on your part with uncertainty for return on investment.
8. Sell apps to companies or investors
The above modes of selling will give enough credibility to your application and now you can take it to a big company or investor. With more capital investment, the application can be promoted in a better way. Furthermore, the app you developed can be of great value to the purchasing company or investor. If they find the application is worth it, they might be willing to make good offers.
Instagram is the example of application that was officially launched in October 2010. With this app, the users can take pictures, apply a digital filter to them and share them across various social networking services. You can get an idea about the value of this app from the fact that Facebook acquired for up to $1billion in cash and stock in April 2012.
Pros: you can make a handsome profit by selling the app to the investor.
Cons: the application must be in demand or good enough to gain popularity. Long story short, the app purchasing company will pay you good only when they find value in it.
9. Sell Accessories/Products based on your app
This particular means of monetizing your app is possible when your application has gained sufficient popularity. This would be the time to start making accessories or products based on your application and turn in some extra money by selling them.
“Angry Birds” is a popular game application that was an incredible hit in iPhones and now they are making good money by selling its toys, posters and stickers.
The loyal customers familiar with this app are going to be the most likely buyers of such products. Think of the Disney world where your favorite cartoon characters come to life in Disney theme park and their stuff toys are sold across the world.
Pros: Some extra money will always be helpful. Additionally selling accessories will further promote the app and build a strong clientele.
Cons: You may not be familiar with the work required for designing accessories and dealing with the third party manufacturers in the supply chain.
Conclusion
With all the marketing and measurement tools in place, you can win over a great deal of prospects for your application provided that it intrigues the buyer and is fully operational. Leverage upon app stores but it’s insane to rely on them completely. Implement all possible models for maximum revenue generation simultaneously. Being an app developer, you must also know how to capitalize on the mainstream market as a means to capture all possible sources of revenue thereby increasing sales and usage of your application.
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