How do Free Apps Make Money? Example & Secrets
How do free apps make money? how much money do apps make per download? free apps vs paid apps, which is better? these questions frequently asked on platforms like Reddit and Quora.
The thing is, there are many articles, technical write-ups about mobile app developments, but some real questions are still untouched.
Being a part of a leading mobile app development company USA, people around my networks always asked me for app cost estimation and the best options between free or paid apps.
To be honest, the reason for hitting this article is just to clarify all doubts. So if you’re planning to create an app, and want to know all about the monetization, then glued till the end.
Mobile App Types As Per Monetization:
- Free Apps
- Paid Apps
- Freemium App
Free Apps:
As we all experienced the most apps are free apps. From downloading to complete use of the entire app, everything remains free of cost.
Top 5 Free Apps in the USA:
- Google Drive
- Facebook (Most Social Media Instagram, WhatsApp)
- Gitch Video Editor
- Canva
- Google Map
The list of a popular free app is still unfinished because there are lots of… Most social media apps are completely free (except ads managers) such as Facebook, Instagram, Twitter, LinkedIn, and Chat app i.e. WhatsApp.
Apart from the social app, video editors and photo editors are also free apps. Usability (business) app such as Google Docs or Google Slides are completely free.
Paid/Premium Apps:
As the name consists, paid apps simply means a user has to pay while downloading the app. This type of app also categorizes as premium apps. The monetize structure is clear for paid apps.
Top 5 Paid Apps in the USA:
- Netflix
- Spotify Premium
- Youtube Original
- Nova Launcher Premium
- Glitch Lab
Freemium Apps:
This app category lies in between free apps and paid apps. As the name implies, Freemium = Free + Premium…
Freemium app comes with two versions where the basic version is completely free but for unlocking the premium features, users have to pay for it. The primary version comes with just basic features and premium versions compatible with maximum use of a particular app.
Top 5 Freemium Apps From The USA
- PUBG
- Evernote
- Hootsuite
- Buffer
- Wistia
Freemium apps have the future among all, it has the potentials to decor the customer need at different levels. Freemium apps or any freemium products are surely taking steps towards the future, once users habitual with the structure then they turn into paid apps.
Let’s take an example of Slack, (Chatroom for professionals) this app is first admired users need and allow free access. once it notified by huge users, then Slack starts to monetize their plans.
How do Free Apps Make Money?
Free apps offer basic features and most of them are static. A static app means, they need to design only once, after the app launch, there is no need to update them.
Many cool apps are dynamic and offer the same features compared to paid apps. So the question rise that how that type of free apps makes money.
Actually, they survive with smart monetizing plans that include Advertisement, Sponsered content, and lot’s more.
Monetizing Plans:
- Sponsered Ads
- Freemium Feature (Free + Premium features)
- In-App Purchases
- Advertisement (Text, Video, Carousel)
- Sponsored Content & Ads
How Does WhatsApp Make Money?
Hmm! seems tough question, lemme research about it…
One of my friends asked me, “How does WhatsApp Make Money?” Those who are unaware of WhatsApp, it is an instant messaging app, popular in most of the world.
As we all know, WhatsApp is a completely free app without having any premium version or any In-app purchase. But still, this app offering the best performance and nice features.
A trustworthy message by Whatsapp, that shows how much they care about user experiences. but… Wait! they also need to pay monthly bills, thus, this app also working on monetization.
WhatsApp comes up with the paid version of the app, where they charged annually $1 from the users. At the initial time, they got funding($250k)… later on, WhatsApp owned by Facebook at $19 billion.
The initial funding was optimized by 5 ex-yahoo friends, who become co-founder of WhatsApp.
The app continuously funded 3 times on a period of time. And recently, Facebook acquired WhatsApp with an unbelievable deal of $19 billion (approx).
So, this is the untold story behind most of the free apps…
You must be wondering?
Every free app has funding to survive?
Nope! Not all, only those app needs funding that has to be updated with their database and features on a regular basis.
Actually, app maintenance is not so costly, so once apps successfully develop, they can easily survive with ads, sponsored content or funding.
On the contrary, most of the apps(free) failed due to a lack of monetization planning through sponsored content, Advertisement, or fundraising.
That’s how most of the free apps work… Funding makes them survive and sustainable to last longer.
Final Thought:
Offering free apps always helps to increase app downloads. In my opinion, freemium apps are the best of both worlds, you can attract users for downloading the free app and later on, insist them to upgrade on premium.
That’s all from my side, Hope this piece of article helps you to understand “How do free apps earn money on the play store”.
If you are planning to create a mobile app and need experts, then we are the best source. Acquaint SoftTech is a leading mobile app development company USA with having a vast portfolio in the same domain. Feel free to discuss your dream idea with our experts.
