Developing a Free Mobile App: Is It Still Worth It In 2019

Today there are more people that have a smartphone than the ones who own a credit card and most people communicate through text messages. That’s the reason why businesses are gearing up their mobile strategies.  

With the massive usage of mobile devices, your brand would most definitely need its own mobile app so that it’s up-to-date with the market. Companies either convert their websites to mobile or go for an app. However, applications have a big advantage as they tend to deliver an elevated user experience and interface, designated for mobile usage.

It’s a fact that free mobile apps outmaneuver paid ones. They are way more downloaded and actually earn more. However, you need to know how to capitalize on those users through app data monetization for example. So is it still worth it to develop a free mobile app for your business in 2019?

Paid vs Free Apps

First of all, let's point out the differences between paid and free apps. According to this research 90% of apps on the market are free. The revenues generated by paid apps are only expected to go down in the next few years.

It’s also indicative that users are more willing to pay for in-app purchases instead for paid apps. Once a user is convinced that an app is really valuable, it’s more likely that he’ll generate transactions within it by paying for in-app features. Many of the younger users prefer this flexibility. 

A very strong free app revenue stream is advertising. Not many people actually click on these commercials but developers still choose this monetization method, making it a major revenue-earner.

What are the ways that free apps earn money?

If you open Google Play or Apple AppStore’s top grossing apps lists, you’ll see that there are mostly free apps. Here are some of the reasons why free mobile apps are still completely worth it in 2019.

In-App Ads

Ads are literally all around the global market and that makes them it’s driving force. In-app ads are tools of affiliate marketing. Through them, you advertise your affiliates’ products in your app and you're paid if users interact with these ads.

The most popular types of campaigns using in-app ads are: 

• Cost per install. That’s whenever a user of your app installs an advertised one, you get paid.
• Cost per view. This model is mostly used for video ads. You get a payout every time a user watches one.
• Cost per click. As the name says, this campaign means you get paid every time someone clicks on an ad. However, a single click is almost worthless, so they are usually calculated in thousands.

In fact, mobile advertising was predicted to drive 75% of all digital ad spend in 2018. In-app ads are also set to triple in value from 2016 to 2021. It makes it the most preferred way for monetizing a free app and in 2019 it continues to grow.

In-App Purchases 

Another extremely popular strategy used in all app markets. It allows users to but something inside the app, like a specific premium feature for example. Actually, 48% of mobile app earnings are from in-app purchases.

The users that spend on in-app purchases actually spend 20 times more than the paid app users combined.

The Freemium Strategy

To use this strategy you’ll need a second paid version of your app. And also, a pretty mind blowing app. Your users need to like your free app so much that they want the full version. 

Your free app may also contain ads and limited functions, so users just get a taste of what you have to offer. If they like it enough, they’ll be redirected to an app store where they can get the full app.

Subscriptions

This model is often used for online newspapers or magazines, audio streaming or cloud services. You can provide users with a free trial period and then charge for subscription. It is highly effective for leading paper apps like the New York Times that has acquired 1 million online subscribers, for instance.

Apple and Google provide an ability to handle transactions through their platforms. For this service, Apple takes 30% for the first year of all subscriptions and then 15% and Google takes 15% of subscription even during the first year.

Conclusion

There are many ways you can use a free mobile app that actually earns money for your business. We’ve listed some of the strategies above but you can find a lot more and choose the one which works best for you, as, for example, more iOS users spend on in-app purchases than Android.

Plan your ad campaigns wisely, provide your customers with regular updates and great user experience and deliver value to them. That’s what makes developing a free mobile app completely worth it in 2019.