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Can ad-supported apps generate more revenue than paid apps?

Posted By: Jason

With the huge amount of users that frequent Apple and Android's app stores, mobile app development can be extremely lucrative for software developers. One of the toughest decisions developers have to make, however, is whether or not to make an app free to consumers. Due to this difficulty, this decision often gets overlooked, and a lot of software houses don't consider how they're going to make money out of their apps until too late in the development cycle.

It's no secret that free apps are incredibly popular. Despite this popularity, however, a lot of businesses engaged in mobile app development hit a wall when the time comes to decide whether their app should be free or paid. Obviously, this isn't a decision that should be taken lightly, so before you pick a side, ask yourself the following questions:

How often will my app get used?

Will consumers be willing to pay an upfront fee for my app?

How do my competitors, particularly the successful ones, make money from their apps?

If you think your app can stand on its own two feet, offering consumers a compelling enough reason to part with their cash, an upfront fee might be the answer. The reality, however, is that very few Apple and Android users pay outright for their apps. Because of this, most mobile app developers are looking at other ways to monetise their software, offering users the choice to make in-app purchases, or take out subscriptions, to make money.

Far and away the best way to generate avenue from your app, however, is to support it with ads. Unlike consumers, advertisers are much more likely to dip into their wallets; after all, they need developers to help market their own products.

There's no reason you can't tailor your strategy, choosing the best of both worlds, to give consumers the experience they want. It's becoming increasingly common for app developers to produce two versions of their app: one free, supported by ads, and another that is paid and ad-free.

In short, before you put your app on the market you need to investigate all the options, deciding which option is the best fit for you.