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How to Determine the Right Pricing Model for Your App

December 30, 2015 No Comments

Featured article by Ritesh Patil is the co-founder of Mobisoft Infotech

Between developing and launching an app there comes a point where you need to make strategies on its pricing. Deciding a right pricing model for your app is crucial as it would help you generate revenue through your app.

There is a point comes when the iOS and Android app developersrealizes that app development is bit easier than determining its pricing model. Now let’s be realistic, no one develops an app without having a primary goal of earning money out of it. You work day and night long to develop an app, but you need to figure out how to plan and implement a pricing strategy. Constructing a good pricing model is quintessential; otherwise all your effort of developing an app would go down the drain.

You as a developer need to measure their pricing models on the basis of the following factors:

  • * Objective;
  • * To maximize the app’s reach;
  • * To graph the profitability scale;
  • * To focus on maximum return on investment.

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Read on to check out some of the pricing techniques you can adopt for your app pricing strategies:

1. Freemium:

Freemium is one of the app monetization options which offer its basic version of the app/game for free while charging premium amount for the advanced edition for multiple other functionality. Basically the focus here would be to grab user’s interest and create curiosity among them to use even the better version by paying premium charges for it. Games like Angry Birds, etc. are the example of freemium pricing model.

Any app or game with freemium pricing model would be constructed with in-built advertisement space. This practice is highly appreciated and adopted by the developers.

2. In-app purchases

This is another popular way to increase profitability while generating profit through the app. In-app purchase pricing model allows the user to download the app for free but charge for using its function or utilities. In-app purchase is most appropriate for games where player’s interest overpower the thought of spending money on it. Research says this pricing technique has boosted the revenue structure of some of the top-rated games by 79%. All you need is determining the prices for in-app purchase. If this model is implemented properly, it would be best suited for any kind of business.

3. In- App Advertising

This is yet another type of pricing model which allows maintaining the consistency of the revenue generation by propelling it through in-app advertisement. Here you will get paid by the users during the event of app download and side by side will continue to earn revenue through in-app advertisings. Therefore, right from pop-over to banners, it caters ample range of advertising and promotion opportunities. It is like an advertising platform for the online marketers. One thing to be kept in mind while implementing in-app advertising is to come up to user’s expectations and circumvent boredom and annoying factors.

4. Advertising in free app

Many developers prefer this pricing model where app can get monetized through offering the marketers paid advertisement. Yes, with this monetization model the users need not require to pay to use the app.

These kinds of app receives comparatively much more downloads than the usual ones as download of such apps cost the user nothing. The advertisement appears to be non-intrusive and remains till the app is in use. You can earn from this pricing model only when, user in bulk, downloads and use your app frequently. Therefore, choose this app only when you feel that your app has a potential to make through number of downloads and would be used for prolonged period.

So what’s your call?

Now you have to make decision wisely as pricing strategy of an app is the one of the most crucial part of an app development. Any kind of monetization counts on the nature and potential of your idea and that of your business model. Combination of all the aforementioned models can serve you a new pricing model which is known as hybrid pricing model. But as mentioned before, think wisely and consider all the important factors before you launch your app.


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Ritesh Patil is the co-founder of Mobisoft Infotech that helps startups and enterprises in mobile technology. He loves technology, especially mobile technology. He’s an avid blogger and writes on mobile application. He works in an iPhone application development company.


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