10 Ways to Monetize Your Mobile Apps. My presentation from the MobileSlopes conference in Ogden, Utah on March 16.

1. MONETIZING MOBILE APPS
Dave Stevenson
@dnstevenson

2. I SELL APPS
(only iOS and Mac)

3. STEVENSON SOFTWARE
• Selling Apps for 2+ years
• Over 40 iOS Apps
• Top-Selling Gardening App - Landscaper’s Companion
• Top 100 iPhone, Top 10 iPad
• Featured by Apple a Few Times

4. 10 WAYS FOR YOU TO MAKE MONEY
WITH APPS
1. Paid
2. Advertising
3. In-App Purchases
4. Webapp Subscriptions
5. Subscriptions
6. Sponsorships/Promotions
7. Lead Gen
8. Affiliate Sales
9. Analytics
10. Super-Secret Way

5. #1 - PAID
• Simple: You set your price, people buy
• Apple keeps 30%
• Don’t
forget about ongoing costs:
support, hosting, etc
• Customer for Life - People Expect
Free Upgrades
• Higher Price != More Money
Day One

6. PAID
•A 0.99 cent app makes you 0.70 cents
• Some Math
• Price_of_App - Apple_Cut - Your_Costs = Your_Profit
• (0.70 - costs) * app_sales = your_target_number
• Considerations:
• Is your target audience big enough
• What is your competition priced at?

7. #2 - ADVERTISING
• Typical with Free Apps
• Is Your AppUsed One-Time or Does
it Have a Long Lifespan?
• Need a lot of downloads to make any
sizable money
• Expect
pennies per day for each 100
downloads per day
Airplane Quiz

8. ADVERTISING
• Different Ad Types
• Traditional Banner Ads
• Full-Page Interstitials
• Referral/Action Ads
• Earn $ per display and/or per click/action
• Easy to Implement SDKs
• iAds is built-into iOS SDK
• Google Adsense, Tapjoy, Millenium Media, Lift Media - there’s hundreds!
• Aggregators: Mobclix, Adwhirl

9. Verbs & Jamie’s Recipes
#3 - IN-APP PURCHASES

10. #3 - IN-APP PURCHASES
• Lots of Flexibility
• Free + In-App (“freemium”)
• Paid + In-App
• Different In-App Purchase Types:
• Tokens (consumable) - think Games
• Upgrades (non-consumable) - Free-to-Pro Upgrades,
Additional Levels/Content
• Expect 1-5% conversion rate
• If 100 people download app, 1-5 people will make in-
app purchase
Tattoo You

11. #4 - WEBAPPS
• Users
Pay for Services through
Webapp
• Distribute Your Mobile App for Free
• Reach More Customers
• Requires Double Work: Mobile App +
Webapp
Evernote

12. #5 - SUBSCRIPTIONS
• In
Order to Get New Content, User
Must Subscribe
• Typically Magazines
• Not Widely Seen Yet
• 1-5% conversion
Kids-In-Mind

14. #6 - SPONSORSHIPS / PROMOTIONS
• “Brought to you by XXXX”
• Like Advertising- Companies Pay You
to Feature their Product or Service
Twitter

15. PROMOS
• Do Your Own Promotions
• Make a Free app that has marketing to
your paid app
Plant Pictures

16. #7 - LEAD GEN
• Companies Pay You to Get them Sales
Leads
• High Trust is Required
• Sometimes viewed as “slimey”
• Super Low Conversions
• Volume, Volume, Volume
Zillow

17. Chomp & iRecommend
#8 - AFFILIATE SALES
Earn a % on Purchases User Makes Through Your App

18. AFFILIATE SALES
• Apple Pays 5% on Purchases
• http://www.apple.com/itunes/affiliates/
• Amazon: Up to 15% on Purchases
• https://affiliate-program.amazon.com/
• Lots of Others: Clickbank, Commission Junction, ShareASale
• Usually Low Margins - 5% on 0.99 = 4 cents

19. #9 - ANALYTICS
• People will pay for anonymous
analytics data from your app
• Not Against Apple’s Standard TOS to
collect
SimpleNexus

20. #10 - DON’T
• Not All Apps Need to Make Money
• Banks, Marketing, etc
• You Can Still Make Money
• Build Them for People
• Invest in Them
• Work for Them
Chase

21. GETTING PAID
• iOS Contractors are earning $75+ / hour
• Little Experience Salaries: $75+
• Experienced: $100k +

22. REVIEW: 10 WAYS TO MONETIZE YOUR
APPS
1. Paid
2. Advertising
3. In-App Purchases
4. Webapp Subscriptions
5. Subscriptions
6. Sponsorships/Promotions
7. Lead Gen
8. Affiliate Sales
9. Analytics
10. Don’t

23. MONETIZING CONSIDERATIONS
• User Expectations
• Your Costs
• Market
• Do Some Math
• Mix & Match

24. USER EXPECTATIONS
• There is a race to the bottom - $1 is almost too much for some users
• Monetize and Price According to Category Expectations
• Simple Games = Free + In-App Purchases or Paid
• Niche Apps = Paid w/ Higher Price?
• News App = Advertising

25. YOUR COSTS
• One Purchase == Customer for Life
• Lifetime-Value of Customer == 0.70 ?
• Support, Infrastructure (Hosting, Bandwidth), APIs, Partners
• Instagram’s Monthly Hosting Bill: 2 nice cars each month!

26. MARKET
• How Many People are in Your Target Market?
• Now, How Many of those People Have iPhones?
• Next, How Many of those People with iPhones will Purchase Your App?
• Rule of 1%
• 1.5m gardeners, 15k w/ iPhones, 150 will buy my app

27. DO SOME MATH
• 100 apps downloaded each day at $0.99 = $70 or $2,100 per month
• $2,100 per month is $25,200 per year (just above poverty)
• Thinking
of Doing Adwords? $0.25 per click + 25% conversion rate = cost $1.00
to make $0.70
• Even worse with realistic 1-3% conversion rate
• Typical Apps will Cost > $10k for v1.0

28. MIX & MATCH
• Monetization Methods can (and should) be Combined
• Paid App + In-App Upgrades
• Free w/ Advertising + In-App Purchases/Upgrades
• Free w/ Lead Gen + Advertising
• Affiliate Sales - Anytime You Have Links to Outside Content

29. PARTING THOUGHTS
• Each Monetization Strategy May Have Different Business & Marketing Strategies
• Paid and Advertising are Easy to Dip Into
• Just remember to watch your costs
• Freemium will be the most interesting space to watch

31. GOOD LUCK!

32. THANKS!
• web: http://www.stevensonsoftware.com
• email: dave@stevensonsoftware.com
• twitter: @dnstevenson