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App Monetisation: Choosing the Best Business Model for Revenue

Generation

The Road from App Development to App Revenue

So you’ve created a professional, useful and attractive application and you want (ideally!) to make some money with it: what to do next?

Here are the possible monetisation models to consider:

1. Immediate Revenue Third Party Supported

Advertising Sponsorship

Payments Paid Downloads Subscriptions In-app Purchases

2. Long-term Revenue Establish and Exploit

Branding

• By relying on third party revenue you can offer the app free and• Increase brand reputation• Increase App Store presence• Build a following

• Ad Revenue = Clicks x CPC

• Of all other revenue models out there, one payment model has become the most successful in the past several months…

The Pros and Cons of Third Party Revenue

Apps with In-App Purchasing Now, in-app purchasing is driving revenue for the top grossing apps End-users can purchase upgrades, more levels, virtual goods, or extra

features from within the App Top 20 grossing game apps - 60% drive revenue with in-app purchases.* In-app purchases on free apps - 15% of total app revenue on iPad and 14%

of all total app revenue on paid apps in Dec 2010.**

* iTunes Top Grossing App Chart, March 4th, 2011.** Distimo ***Flurry

A Few Apps with in-App Purchasing Functionality…

Entertainment

Games

Photography

News

Finance Management

• Enables you to create content, features, or offer services from within your app.

• Allows you to create revenue while exploiting the high download rate of free applications. Users are willing to spend more on extra content!

• Allows experimentation with different monetisation models (subscriptions, pay-per-feature transactions, etc).

In-App Purchasing: The Pros

• It takes more time and effort to configure in-app purchasing capabilities.

• Your app needs to have strong micro-transaction potential

• You must be able to create additional content, functionalities or offer new services.

In-App Purchasing: The Cons

• This talk has touched on the basic monetization models…• Best monetisation strategies often require experimentation

with a combination of these models• Choosing the best monetisation model will depend on several

factors: 1. The target market 2. The micro-transaction potential of the app

3. The kind of value it offers to users

In Conclusion…

Thank you!

Email: diana@apppli.com

Questions/Comments?