Subscription-Based Apps

Paid subscription is just one of many app revenue models that you as a developer can consider, alongside some of the more traditional models of free with in-app advertising, freemium with gated features, paid and in-app purchasing.

A subscription model is like that of a freemium business model, but focuses on gating content and allows users to test your app, but they then need to sign up for a subscription to bypass certain content limits and restrictions.

Today we’re exploring why subscription-based apps have become the new revenue model favorite, and what makes this type of app so successful (as well as challenging).

Pro’s of App Subscription

1. You tend to see higher revenue per user than other business models.
2. A steady source of reliable income.
3. Likelihood of a more engaged user, as they want to make sure they get their money’s worth!
4. And although the fees are still higher to the stores than alternative web payment methods, the experience of a frictionless purchase shows conversion rates to be significantly higher than usual account and credit card flows.

Con’s of App Subscription

1. The need for continuous release of new features and content.
2. Free trial periods/with onboarding as a necessity.
3. Ongoing customer support.
4. And maybe some backlash from existing customers due to a transition from a one-off fee to monthly.

Having now worked with a large number of publishers, we have seen certain types of apps perform better than others, such as content apps providing children’s video and service apps, such as Evernote. Those that seem to perform less well are single-purpose apps and games.

Whatever your thoughts, the major stores are now reporting significant growth in publisher subscriptions and accompanying payouts. But remember, you’ll need to make sure you can provide a regular stream of new features and/or fresh content, along with great support to really make this revenue model work for you.

As always, if we can help in the promotion of your subscription, then do reach out today as we are achieving super results!

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