How Much Money Can You Earn Through Mobile App?

You must have heard the buzz – apps can make a lot of money, and we mean a lot! Asking “how much money can an app make” is, of course, a natural step in the mobile app development process, as knowing the financial upside will fuel your strategy.

We have endless examples in front of us that justify it. In 2018, Fortnite (Epic Games) garnered $1.9 million in a single month. In the first half of 2020 (1H20), PUBG Mobile made nearly $1.3 billion globally. In 2023, TikTok was the top grossing mobile app with $2.7 billion revenue. Yes, that’s a billion with a B.

Honestly, I’ve been digging into the subject to know what’s making this much money. You can also start to think about it now.

But before we do, let’s understand how much money an app makes on average. The top 200 apps garnered $82,500 on a daily basis, while the top 800 apps made around ~3,500 per day. To your surprise, gaming apps make nearly $22,000 daily, while entertainment apps gather $3,090 per day. We are discussing an average here because it’s not a one-size-fits-all approach. App earning depends on numerous factors like app platform, objective, earning model, structure and a lot more.

If you are at square one of catalysing on an amazing app idea, one significant thought is on how to save on mobile app development services during the entire process.

How an App Makes Money – An Important Concern for Businesses

The global mobile application market reaached at an evaluation of $252.89 billion in size. Furthermore, it’s estimated to reach $783.53 billion by 2032 and grow with 14.33% CAGR over a forecasted period of 2024-2032.

These whopping numbers underline the fact that the market is certainly huge for the ones who are considering mobile app development services for their business and depend on it for significant revenues. Besides, the exceptional surge in the internet usage, smartphone penetration rate and the emerging technologies like AI and Machine Learning are a handful of the forces for the world app market success.

From idea to execution, mobile app development guidelines are inescapable. Though it’s daunting to cover everything in one article, we’ve divided it into two parts. Let’s focus on the one that matters the most – “Monetization Model”. It’s important to understand different revenue models and strategies for an app to earn.

The Best Monetization Models and Their Pros and Cons for App Revenue

Here are the top monetization models that can maximise your app revenue. Explore each model’s pros and cons to find the best fit for your business goals.

1. Freemium Model

As the name suggests, it’s a free app. Precisely, it’s a perfect combination of free and a handful of premium features.

In this, the app is free to download and use, but some of the exclusive features are paid. For example, in paid version, ad-free usage of content, optimal performance, attributes are paid features. Primarily, in- app purchase model is a subset of the freemium model. The subtle difference between both is that in the in-app purchase model, users have to pay for numerous levels, whereas the freemium model restricts to one time payment.

In comparison, the freemium model is easier to acquire users as users feel benefitted from one-time payment. Investing in this type of mobile app development will help you retain consumers and also generate revenues seamlessly. Though it’s a free app to attract more consumers, many times the app’s USP is not present leading to revenue fluctuations.

2. In-app Purchase Model

Herein, an app is free to download from the respective app stores but allows purchases of services, better performance and premium level features on a cost. Access to a high level of user interaction is what a consumer pays for.

In essence, if everything is considered, the app could gather users who use a free portion, a segment of users who pays for enhanced performance and the one who continues to pay for it.

One more strategy can be established here. Most of the businesses make money by offering products that the app can only operate. For instance, gaming apps make money following this model. The restricted stages of a game, lifelines, game currency are some of the tactics which a user will have to purchase or earn. In this way, consumers are regulated to use the services within an app and convince them to make buying decisions subsequently. Certainly, they adopt this strategy widely, making big profits.

According to Statista, app users spend $35.34 billion dollars on the mobile app globally in Q2 of 2024. This clearly shows the market’s untapped potential. However, the real demur is to convince an app user to switch to the payable versions, that too in a smart way and not washing away your free users.

3. Data Collection and Purchase Model

Buyer persona, purchasing history and all the other related data about the users, collected by app are crucial resources. Even if an app is free, the data gathered itself can generate behemoth money. Also, that data sounds beneficial to other companies, researchers, analysts, who are ready to purchase the data.

Notably, considering the user experience part of mobile app development, data plays a crucial role in enhancing app experience. Leveraging the latest technologies, the user data provides a personalised and relevant experience.

One example that brace this statement is of the marketplace. You search for smart wearables, explore a few options and then abandon the app. Later on, you get recommendations for the same category, with discounts and deals. Nonetheless, users are concerned about their data and this makes it one significant hurdle.

4. Subscription Model

This is a top pick for any app. Wondering why?

It provides users with quality content for a limited time period, until they get used to it, and then charge them to continue using the app. Subscriptions can vary from monthly, quarterly, semi-annually or annually. The app subscription model is the most appropriate choice for the apps offering cloud-based services like news, videos, music, etc from a financial viewpoint.

5. In-app Advertisements Model

In this business model, app owners’ core objective is to gain a significant customer base. Thus, providing relevant content and advertisements that have the same target audience could act as a huge earning channel. For instance, if you have a music streaming app, and you could advertise a headphone brand, this acts as a win-win situation as people are more likely to make a buying decision.

Different types of ads can be used as banner ads, native ads, full-screen video ads, reward ads; depending on the aspects like relevancy, content and notably, adopting the highest revenue generation strategy from any or many of them, picking your income from array wisely. Besides, you can make the ads optional also, skip the ad after a few seconds or make ads compulsory for the next move.

The ads cost is decided based on either cost per impression or cost per click. Moreover, you can promote the app on their platform also. Although, you should also keep in mind that advertisements are often considered time-consuming, daunting, eventually making a user quit the platform.

Recommended Reading – Simple Strategies to Fuel App Growth and Monetize Effectively

Where Can Your App Earn Revenue? Top Platforms Explained

Since you know that the app could make money in endless ways, you can always pick the one that fits easily with your requirements. But before commencing on the platform aspect, it’s equally important to understand how much it costs to build an app and where it’ll be rolled out.

We’ll discuss every platform on which you can launch your mobile app.

1. App Stores

There’s no doubt, that Google Play Store and App Store are two famous platforms for mobile apps, allowing Android and iOS apps featured in them respectively. Android apps dominate the lion’s share and offer a bigger segment of the market for businesses to acquire.

iOS, on the contrary, has a few limitations, though it’s also a considerable market to target. Put simply, Google Play is the biggest app store, where users can select from 2.3 million apps, as per the Q2 of 2024.

2. Wearables

Mobile app development is no exception to wearable. Yes, you read that right!

While leveraging app development solutions, one can also check the compatibility with smartwatches, glasses, headsets, bands, shoes, fitness trackers, etc. With wearables emerging increasingly, it’s no surprise that smartwatches are forecasted for exponential growth in 2024.

Optimising your mobile app development to be smartwatch-compatible could attract more downloads and prove to be beneficial. In essence, your app will have numerous streams and also bring huge profits. It would offer a competitive edge to your solution in the flooded market.

For More on This, See How We Broke it Down in Virtual Try-on App Development Guide

3. Voice Apps

The voice assistant’s core objective is to make things easy for the user. It can make a personalised experience, enhance the product offering, create a brand, and certainly mark an omnipresence. The devices integrated with this technology will cement their footsteps in a bigger market being future-proof.

So, rather than just wondering how free apps make money, it’s better to invest in an app that is congenial to this technology.

4. Smart TVs

Apps are no longer just mobile things. Using the app on a much wider screen is a convenient way that many people embrace and easily adopt. Streaming services, music, gaming, etc apps are the most popular ones that users prefer to use.

Considering the fad, smart TVs are not a topic to turn a blind eye to. In the not-so-far future, advancements and innovations will surely bring something revolutionary. So, why not ride the bandwagon and capitalise on the app idea?

5. Spatial Computer

Apple Vision Pro brings a new era of spatial computing to business. This emerging technology allows for immersive experiences that amalgamate physical boundaries with digital technology, offering a unique value proposition for businesses to develop innovative and intriguing apps. Thus, by leveraging app development solutions for the Apple Vision Pro, you can reach a new audience and uphold user interaction in unprecedented ways.

Think launching your app was the finish line? Think again! The time right after rolling out your app is equally or more crucial. Post-launch development support is essential for building your app’s presence and setting it up for long-term success. Don’t worry, it’s not rocket science.

Know More – Why Post-Launch Development Strategy is Important?

Finally… “Mobile Apps Can Generate a Lot of Money”?

Though, this doesn’t have a definite bracket, but the whooping revenue statistics can help you have a general understanding. For example, gaming apps generate $98.74 billion in revenue and entertainment apps like video streaming apps generate $8.6 billion in in-app revenue. This is not all, even simple apps and smart devices also have significant earning potential.

Based on our research, we’ve seen that the majority of the industry giants prefer a subscription-based monetization model, and often combine it with other sources of revenue.  Don’t skip the queue of smart devices when considering app development solutions.

Apptunix’s mission is to help businesses scale with the help of our mobile app development expertise. If you are feeling stuck wondering how you can create a revenue-generating mobile app, our team is happy to assist you.