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Apps

How to make money with your app: free vs paid

money with your app Currently up to 90% of the time we use our mobile phones, we spend on applications. For this reason, how to make money with a free or paid app has become a main objective for many companies.

The application market is continuously growing and it is expected that in 2025 this sector will reach a value of no less than 226 billion dollars . A succulent bite that no company wants to leave off their table.

Paid App vs. Free App

Nowadays, we have the possibility to create our own applications to earn money . We can do it through free or paid apps. One strategy is not better than the other, but knowing how to choose is important so as not to waste time and money.

payment applications

You have to make an initial outlay to use them. They are applications that will give us money directly , but they have a lower number of downloads, since there are customers who are not willing to pay without first having tried what you offer.

Your consumers have high expectations , so the platform has to work perfectly and offer functionality that meets their needs.

The design and development of this type of app is high and its monetization options are more limited.

free apps

They attract more users and have higher visibility and number of downloads.

As a consequence, many opinions are also generated that help to optimize the user experience.

Its design is less expensive , since it starts with something simpler, and according to the feedback received with its use, it is perfected. Consumers of these applications do not have such high expectations.

Other ways to earn money with a free app

In-app advertising

App advertising displays ads, usually through reward videos. Normally, when the user watches an ad, they get coins to unlock additional levels or features.

Advantages:

Ads in apps have a higher chance of reaching the public than if they are made through other means. They also help measure engagement and drive more traffic.

Disadvantages:

This model is effective only with applications that have a high user attraction . If unattractive ads are used, they are completely ignored, and can even be seen as a bad user experience for interrupting your session.

Subscription

Typically, the app offers free content for a trial period, and afterward, users pay a subscription fee to access the content without restrictions.

Advantages:

They offer reliable income and are apps that attract users who are committed to the platforms they consume. These are creating feedback that allows you to improve the app.

They use reduced prices in installments that do not involve a large outlay for the client.

Disadvantages:

New features and more content need to be added on a regular basis to keep the app up-to-date and interesting. It also requires a good efficient assistance system.

In-app purchase

This model turns free app users into consumers in a way that is not too intrusive .

It allows you to sell a wide variety of virtual items, in addition to improving the user experience.

Advantages:

It is a method with the possibility of obtaining great benefits through a large number of low-price purchases, by acquiring gems or coins in the application, which are used to acquire more advanced services.

Credit data is securely protected for purchases within the platform.

Disadvantages:

Poorly implemented shopping can lead to negative reviews and unhappy users. You also have to keep consumers hooked so they keep paying through constant updates and new products.

The cost in design and development is high.

Freemium

Freemium apps are apps where users download the app free of charge , but have limited access to the services they offer. If they like the app, they have the option to pay to enjoy the rest of the features.

Advantages:

They have great reach because they are free , they have the advantage of a subscription model and they do not present intrusive advertisements that can annoy the user.

Disadvantages:

Income fluctuations appear , since registrations in the application are not as reliable as in the subscription model.

data sale

Mobile phones are usually used by a single person, so their use is related to the daily habits of their owner. The applications collect a large amount of information that they can later sell to companies and organizations interested in it .

Advantages:

These data are a useful tool to identify and listen to the needs of consumers and make these needs available to companies capable of using them and, for example, segmenting consumers in purchasing processes.

In addition, it is a very profitable monetization model.

Disadvantages:

It is difficult to maintain the confidentiality of customer data in some cases, as well as to guarantee its security.

Tips for choosing the best strategy
We list three tips to choose the best strategies for your app

App

The first thing is to decide what we want the application to do . That is, establish what problem it solves and how it does it.

We will be able to define what type of monetization is best for our app, since not all formulas work the same for all types of applications.

Competitors

Competitor research should be a priority.

Studying other similar applications will allow us to know what users like the most about them, what aspects need to be improved to offer a better product and what monetization strategies are the most common and how they use them.

Users

Another very important aspect when defining our product and that will help us choose the monetization strategy is the study of potential clients .

We must thoroughly investigate their profile with information such as age, needs, time slot in which they are going to use the app, know how much they are willing to pay, etc. with the focus on designing a product that really meets our objectives and user needs.

Conclusion

As you may have seen, the way to earn money with your app is a very important decision and it is not easy to make . Yearly has been advising companies and startups for years to choose the best solution for their business. If you have a project and you need us to give you a hand, tell us briefly what you need . We will be happy to help you.

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