Paid apps are becoming less and less popular for startup tech companies because of an accelerating decline in consumer purchases.
Purchasable apps used to be a driving factor for most startup tech companies—either as a reason to start a company in the first place or as an outlet to gain more momentum for an idea already in existence. For a time, it was a great way to make money. Most apps emerged on the market at between $1 and $5, attracting a large audience of buyers looking to fill their smartphones and gadgets with a plethora of cool apps.
Paid apps built momentum as thousands of new developers sought different ways to target the market and make a killing on popular downloads. But as the trend began to rise, free “trial versions” of apps started to appear, mimicking their counterparts with reduced features to compensate for the reduced price. And there, momentum began to slow.
But momentum didn’t halt right away. It wasn’t until the emergence of in-game paid features, decorated around free apps, that the trend truly began to die out. Paid apps simply could not compete with free apps, so free apps inevitably took over. However, developers still needed to monetize and thus found a way to entice users to make purchases without necessitating the purchase of the original app.
In such a model, the app still must be appealing to download—even when being offered for free, people will not download your app unless they have a compelling reason too—but in addition, it must have ample opportunities for users to make purchases.
So what’s the best way to create an app with this structure?
· Include regular, but reasonable purchase opportunities. If you include too many, you could turn off your target audience.
· Keep the purchases cheap. You might be tempted to offer a $10 upgrade, but odds are people won’t go for your recommendations unless you offer things for $1-3.
· Create a need. Tantalize your users by giving them most, but not all, of what they want.
With these tips, you can start creating new apps that generate more revenue than old paid apps ever could. If you’re looking for new ways to market your app or a partner to help build out your current project, don’t hesitate to reach out!
