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61% of App Developers Say ‘Freemium’ Model is Best Option to Monetize a Mobile App

Written on
Oct 11, 2017 
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Adotas  |

The recommendation comes from a new survey of 102 app developers. The survey, plus interviews with experts from 7 app development firms, is the source for a complete business guide to building a mobile app, from concept to monetization.

More than 60% of app developers recommend a “freemium” model for monetizing a mobile app, according to a new survey. With the “freemium” model, an app is downloaded for free with the option of in-app purchases and upgrades, appealing to users’ desire to test an app before buying it.

New survey findings come from Clutch, a research and reviews platform for business services. Read the complete report and source the survey data.

Report Findings

Along with expert recommendations for monetization strategies, Clutch found that the most successful mobile apps require a holistic approach that extends beyond development. Companies should focus on strategic internal planning, one signature feature, and a proactive marketing plan that expands their existing brand narrative.

For example, with Apple’s App Store projected to host 5 million apps by 2020, marketing is essential to the app development process. Nearly 40% of app development firms surveyed say social media is the leading marketing strategy for driving conversions for mobile apps. This shows that social media may outperform in-app advertising for app marketing. Only 8% of developers surveyed recommend in-app advertising due to evolving best practices in user experience and shifting consumer preferences.

Some app development firms provide basic marketing support to clients. For example, Raizlabs, a Boston-based firm that has developed mobile apps for clients including Virgin and Six Flags, provides some marketing assistance. “We help [the company] articulate the value of the app and make sure it’s part of the company’s overall story,” said Gregory Raiz, Founder of Raizlabs (pictured top left).

Choosing the right development solution is key to launching a successful app. Before selecting a development solution or partner, companies should consider their budget, desired app features, and long term maintenance costs.

Nearly 70% of app development firms now require a discovery stage to clarify goals and design requirements, and companies are encouraged to think strategically about the potential costs and opportunities associated with an app.

App development options exist along a spectrum of sophistication and pricing. While DIY App Builder software can be used to produce simple, low cost mobile apps, highly customized projects typically require a boutique or enterprise development firm. Offshore firms can offer a middle ground between affordability and customization.

For the raw data, a comment on the findings, or an introduction to the industry experts featured in the report, contact Michelle Delgado at mdelgado@clutch.co.

About Clutch

A B2B ratings and reviews firm in the heart of Washington, DC, Clutch connects you with the agencies and software solutions that help you enhance your business and meet your goals. Our methodology maps agencies and software solutions based on customer reviews, the type of services offered, and quality of work.
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