5 Questions to Ask Before Picking A Monetization Model

5 points to consider regarding the Monetization Model: nature of the app, key features, best category, possible similar apps and monetization strategy

Continuing our series of articles on free vs. paid apps, this post covers the main questions you should ask yourself when deciding on your app monetization model. If you’re feeling a little lost, these 5 questions will guide you through evaluating the different strategies, help you hone in on key details, and draw your attention to important factors which might not be on your radar…yet.

1. What is the nature of your app?

Since ads and in-app purchases are 2 of the most profitable strategies for free apps, the nature of an app plays a vital role in selecting the right monetization model. For example, game or entertainment app users are less likely to get irritated by ads and in-app purchase notifications (common practices in those app categories) than those on an education or productivity app, which may require uninterrupted concentration.

2. How will your app’s key features benefit users?

This is one of the most important questions. You app’s key features will decide whether users might be willing to pay to download your app. If you’re going with the freemium model, this question is also important in separating which of your app’s features can be offered as in-app purchases.

3. Which is the most suitable app store category for your app?

Some categories in the app stores.

App revenue inevitably varies, and it can largely depend on the volume of free and paid apps in the different categories. For example, apps in the popular social networking category generate more downloads than apps in the less popular productivity category. Additionally, the number of paid apps is greater in the productivity category than the more light-hearted social networking category.

4. Which existing apps are similar to yours?

By studying and looking at apps similar to yours, you can find out where user demand has yet to be met. If it turns out you have a one-of-a-kind product in the market, it’s more likely you can successfully offer yours as a paid app. Or, if your product isn’t unique but some of the features are, another strategy would be to offer them as in-app purchases.

5. What is the monetization strategy of these similar apps?

Looking at similar apps in the marketplace will give you an idea of which monetization strategies in your category are successful and which ones should be avoided. Most datings apps, for example, have basic versions which are free and then offer “premium” features to purchase additional functions or filters. What are your users willing to buy? How much will they pay? Keep these questions in mind when evaluating freemium options.

At Sourcebits, we’re experts at determining where your app fits in the sometimes-complex app store landscape. Want further guidance on deciding which monetization strategy is the best fit for you?