I have good news and bad news for app developers. The good news is that consumers are insatiable when it comes to great apps. Usage patterns indicate that the most engaged users frequently search for new sources of entertainment or productivity resources on their mobile devices -- so the opportunities for selling to them are limitless.
Unfortunately, however, insatiability often equates to fickleness. App users constantly seek the next big thing. Inbox was yesterday’s mobile email darling; today, that title has been usurped by Airmail. A few months from now, users will want an even shinier tool that serves the same purpose but has that new-car luster.
But you can use that capriciousness to your advantage. App revenues are on pace to hit $76.52 billion by 2017, and that sum includes significant increases in paid- and in-app purchases. Paid-for app revenues could reach $1.95 billion by 2017, and in-app purchases will likely hit $28.9 billion the same year.
Although consumers are clerly intoxicated with the “free” aspect of “freemium” content, many now realize that the best experiences lie behind a pay wall. And that's actually okay, as the demand for apps has never been higher.
The key to cashing in on this trend, then, is to invigorate your existing fan favorites in ways that appear novel and exciting. Here’s how to do that:
A quick re-skinning sometimes proves the best option when you’re stuck creatively with the current incarnation of your app. Risks lure here, though, because re-launching means redefining your user base. As Facebook learned when it rebranded its controversial Internet.org app, stale products hurt your brand, so sometimes you need to take the plunge.
Some companies push new products into the market as competitors to their existing offerings, so they can own both the market leads and their alternatives. Yet that strategy is difficult to maintain, because the products must feel significantly different in order to prevent users from catching on. It also forces you to hire separate development teams, plan independent release cycles and create distinct marketing plans. Tread this path only if you’re sure you have the resources to pull it off.
2. Build with monetization in mind.
Avoid the cardinal sin of app development, which is ignoring monetization in favor of increasing user numbers. I’ve seen many companies say, “We’re more focused on users right now, and we’ll figure out monetization down the road,” only to regret this strategy a short time later.
You can’t go from giving something away for free to suddenly demanding payment, without incurring backlash -- this is something Apple has been trying to amend since the introduction of the freemium craze. If in-app purchases or paid upgrades have always been on the table, people will feel less taken aback when you ask them to shell out for a cool update or to unlock a premium feature.
3. Use a subscription model.
Subscription apps, such as the newly released coffee app BrewPass, generate revenue even after users lose interest in the app (often because most either forget or don’t care enough to cancel their payments). Target an audience that is comfortable with subscription models, because you’re not going to convince freemium users to start paying every month. Go to market with subscriptions as your goal.
4. Incorporate value-added features.
Value-added features are at the heart of the freemium model. Everyone can use your tool for free, but only paid users enjoy the full functionality and features. To make this profitable, your core offering must be enticing enough to attract users at the outset.
5. Nurture your audience.
It’s not enough to build and release a great app. You need to earn a strong enough following that people will use the product, pay for upgrades, tell their friends and support your future apps. Outreach and relationship maintenance are essential to profitable app businesses.
When Bethesda Softworks released its Fallout Shelter mobile game, it opted for a surprise launch tied to the trailer release for its main console game. Bethesda banked on fans’ franchise loyalty, and the move paid off, as the mobile product quickly racked up downloads.
Novelty is the name of the app sales game. Audiences crave what’s unique, so don’t rely on their past loyalty. Develop products in a way that allows you to constantly intrigue users with interesting features and content.