How profitable are freemium apps?

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When talking about app monetisation strategies, freemium is one the terms that comes up most often. This model is very popular and it seems to strike the perfect balance between the users’ desire to download an app for free and the developer’s need to make money once the user upgrades to premium. Bespoke software development UK companies can help you create the perfect freemium app, but, before that, you need to understand what the freemium monetisation model involves and when it is recommended. Here are some basic facts that you should know about it.

What does freemium mean?

Freemium is a combination of free and premium, meaning that a user can download your app free of charge, but only has limited access to its features. To unlock all features, they must pay the price for the premium version. This model is not restricted to an app category. It works for games (for example, only the first 10 levels can be free to play), customisation apps, lifestyle, health apps and much more. In fact, most apps in Apple Store and Google Play are freemium.

However, simply developing a freemium app doesn’t guarantee success. Here’s where it works and where it doesn’t.

The app should have a lot of features to justify the premium price

The freemium model does not work well with small apps. To split the app into a free and paid version, you need to have enough features to begin with. The part you offer for free should be just the tip of the iceberg. Once the user decides to pay for the full, premium version, they need to be satisfied with what they get and feel that the purchase was worth it. Otherwise, they will request a refund. Needless to say, you have to know where to draw the line between free and premium features. For this, you should ask for the advice of your developer and also look at what the competition is doing. Offering for free one of the features they charge for is an excellent way of standing out and attracting users.

The free part should be very convincing

In order to buy the full app, users should have an excellent experience with using the free part. For you, this involves two responsibilities. On the one hand, you have to talk to your developers and make sure that the free part is very convincing and works flawlessly. The features of the free part should be chosen in such a way as to convince users that they really need the app and that buying the full version is a necessity. However, you shouldn’t offer your most advanced features first, because users wouldn’t have a reason to buy the premium version and you would be losing money. On the other hand, you need to have a considerable marketing budget. The app should be advertised very efficiently, so that users feel tempted to install at least the free version. If the app is good, then it will market itself, but you need to make the existence of the app known.

 

June 2017
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