At the beginning of autumn, the optional “Analytics and monetization of mobile applications” was launched at GeekBrains. A new direction, operating within the framework of Android and iOS-development faculties, has become in demand - the monetization of mobile applications is becoming increasingly important. There are more good applications, the shelf of developers also arrives. Accordingly, many want to make money on their applications, but do not always know how to do it. Let's talk today about where to start.
Anastasia Podorozhnaya, a specialist in mobile development at Appreal Group, who is a partner of the GeekBrains course and the author of the elective, helps to understand the issue.
Please tell me how much time does it take for a developer to determine a worthy monetization scheme?
In the case of daily testing, it is possible to determine an effective monetization scheme no earlier than in a month. Of course, the situations are different, but we are talking about the case when testing is really being carried out - the number of reference points is increasing, various hypotheses are being tested, the optimal balance is being sought in a volatile market. And even after an effective monetization tool is found, it is not worth stopping the testing of hypotheses.
Are there any differences between monetizing in a company and monetizing on freelance?
If we are talking about working in a company, then the developer may not know anything about monetization at all. But the project manager must know the types of monetization relevant to his project.
If we are talking about a developer who works for himself, he can be recommended to try on various user scripts for the project. The most effective scenario I would call is “Ask your mom.” Give your mom, sister or friend a mobile app and ask them to buy something. If they can cope with this without problems, while not being representatives of the IT sphere, then, probably, buying from other users will not cause difficulties.
How does monetization of the game differ from, for example, a geolocation application that allows you to find a coffee shop nearby?
In games, one of the most effective ways to monetize is the free-to-play model. She pays off in the vast majority of games. F2P is a content selling system for games with a long lifespan. In contrast to the subscription, which creates a certain threshold for entering the game, F2P offers several good solutions for the developer: spot sales of content to players with different wallet sizes; wide range of goods; lowering the threshold of entry. Many games, thanks to F2P, have really become free.
Another thing is the cafe selection application. Here the choice for monetization is much wider, for example:
- native advertising;
- priority placement (on mobile maps and in special collections);
- payment for lead generation services by B2B cafe owners;
- payment for access to the system and full control of orders through the application.
According to the latest scheme, in 2016 we implemented Estel Club, where the application helped those who wanted to get a haircut to choose a hairdresser nearby, and salon owners received tools to control the quality, quantity, cost, availability of goods and services.
In general, the key to the success of application monetization is the source of traffic. It is worth testing not only the purchase of advertising, but also the collaboration for cross-promotion, as well as product placement, branding of games by advertising customers and sponsorship packages.
And how much can the application bring in money?
In order for the application to make a profit, it must cure any pain of the user (now we are not talking about games). The application may not be overpopular, but the user must be useful to a certain circle.
If you take the average application in a vacuum, then with 1000 downloads per day, you can get from 1 to 10 dollars. If you take the content - from 1 to 30 dollars. At the same time, many projects have a pronounced seasonality - this especially applies to the tourist destination.
And those of our customers who already use the myTracker marketing platform in their applications have the opportunity to pre-estimate the amount of revenue from advertising in the application. They estimate the size of the audience that saw the ad and get an idea of ​​the effectiveness of ad placements.
How much should you spend on analytics and tests before the optimal monetization scheme becomes clear?
I’ll tell you from the point of view of an employee of a mobile development company, since I have not tested monetization schemes as an independent developer for a long time. The company spends at least $ 1,000 for each test. But this is a calculation for applications that are designed as highly loaded.
In general, different monetization schemes imply different user scenarios that you will program and A / B test. For example, in one case, you will close part of the content, make the content paid and offer the user to buy it once (this is done, for example, in MAPS.ME). And in the other, you subscribe to updates and regular releases, as is done in many online media.
What should be done to increase the return on advertising?
First of all, carefully study the audience of the mobile application, including gender, age, profession and geography. All this is necessary for advertisers. User information can easily be collected using services such as Flurry Analytics and MixPanel.
In addition, data on the number of active users is important, these are Daily Active Users (DAU), Weekly Active Users (WAU), Monthly Active Users (MAU). This is more valuable information for advertisers than the number of downloads.
Advertising formats should also be analyzed. Some of them are suitable for the application, others are not. In a content application, native advertising is best viewed, in a game application, Rewarded Video (an advertising video that you can watch or not watch). The latter works effectively in shopping apps.
When showing the same ad, you should set a limit. We are talking about the price floor limit - this is the name of the minimum price level for advertising in a specific app. You can limit the frequency of impressions, so as not to annoy users.
Well, the effectiveness can be estimated by the average revenue per daily active user. In this case, the ARPDAU metric helps.
What monetization systems are in trend now, and which are becoming obsolete?
The most trendy, in my opinion, are the following ways to monetize mobile applications:
- A monthly or annual subscription to advanced functionality, the so-called paywall model. This may be payment for access to additional library books, dictionaries, maps, some other resources. A great example of the above is the monetization of Bookmate, a book reader.
- A one-time internal purchase, which does not change the functionality of the application, but gives it additional significance. So, in some healthy lifestyle applications you can buy an educational course for classes or consult a specialist in fitness or nutrition. This is a freemium model.
- For free games an extremely important way is to buy virtual goods in the process of passing. Free-to-play.
- Monetization of big data. Many small companies use this method, and large corporations do not disdain it. It is beneficial for developers to transfer depersonalized, anonymized data to their audience to a third party, receiving a certain amount for each user.
- Monetization through advertising. In this case, the user is shown various kinds of banners, native advertising, video and other content. About this method on Habré was written repeatedly, so there’s no point in stopping there. The only thing that can be mentioned is that users from the USA bring the most profit, least from Latin America and Eastern Europe.
Less important is a one-time purchase of advanced functionality. An example is the TopTripTip Russia federal guidebook, in which this form of monetization was used from 2012 to 2017. Since 2018, the application has become completely free.
Analytical tools for monetization - which is better?
I would recommend Firebase Analytics from Google. At the start, it is best to choose it, because the interface of the tool is intuitive - beginners do not have any difficulties with it.
The remaining tools should be added after the developer understands the monetization systems and understands what he wants. Perhaps in some project there will be a need for additional functionality, and Firebase will not be enough.
As for the future of mobile applications, I believe that it is for analytics. The more carefully reconnaissance is carried out before creating the application, the better the consequences will be. Of course, new tools and methods of monetization appear every year, so a developer who plans to make money on his application, whether it is one person or an entire company, must follow the trends and be aware of innovations.