Contrary to what it may seem, a free application is the best way to generate revenue in the mobile application market. Assigning a price to an application means creating a barrier for people to download it. It is common to see applications that were initially free getting thousands of downloads every week, and by incorporating a price, discharges fell by 95%.

But if the application is free, how you can generate income? Don’t worry, there are ways for that too. In today’s post, I’ll share four ways to monetize free mobile applications. Give it a read!

1.  In-App Purchases:


This type of order in the application is what is called model “freemium”. Downloading the application is free, but once downloaded, the user can make purchases within the application to access further services. As for income generation in mobile applications, this is the method through which higher revenues are generated. If you look at the top 20 most downloaded applications can see that all of them are free and use in-app purchases to generate their income. Some examples of freemium models are:

  • Acquiring the “Pro” version of the application: It is the classic strategy to attract more users, i.e. “try it first before you buy it”. In this model, a free version of the app that is only available with a number of features is given to the users with an option to pay for the full version of the application. The examples are the ones that say: Unlock Extra features of the application or the ones that allow the use of the application after a trial period and disable ads within the application.
  • Purchase of virtual goods: This model consists of purchasing goods within the application. It is very common in games like Clash of Clans where you can make purchases of virtual money, life, weapons, etc., allowing the user to progress faster in the game.
  • Content: To acquire additional content such as a song, a video, a story, a game level, etc. offered by the application.
  • Subscriptions: Common in content applications such as books or magazines. The user buys the application for free by accessing some of the content, with the option to pay a subscription to have the ability to access all content. An example of this model is the Spotify subscription that lets you use the application for free, but if you subscribe offers, you get the content both online and offline, also the advertisements are taken off.

2.  Mobile advertising:


As with web pages, applications can generate revenue by incorporating ads within the application. The key to this model lies in capturing the largest possible number of users. The main drawback is that advertising is always uncomfortable when using the application and if it is too aggressive, it may even cause the user to discontinue the use.

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3.  Sales of a Service / Product: 


The application is a tool to provide a service or sell products. Some examples of this model are:

  • Uber:From this application, you can request and pay for a car sharing service. The current valuation of Uber is above 66 billion dollars.
  • Doctors on Demand:This application allows us to get a consultation from a licensed physician through a video conference in exchange of money for 15 minutes
  • Amazon:You can use the Amazon app to buy almost anything that is available on amazon.com

Note that if the application is to be used for the purchase of goods or services, you can not use the mechanism of purchases in Apple applications, you need to use other means of online payment as PayPal or Authorized.net.

4.  User Acquisition:

The classic example of this business model is WhatsApp, which was acquired by Facebook for 19 billion dollars. The main value of Whatsapp is that over 1 billion users generating more than 18 billion transactions a day. Therefore, developing a free application and acquiring a large number of users is increasing the value of the application that can later be monetized, either by selling the application itself, through advertising or other methods.

So, through these 4 ways, you can actually make money from your free app. Use the one that suits you best and enter the world of mobile applications! Good Luck!