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← Ways of Making Money from Your App

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Showing Revision 3 created 05/24/2016 by Udacity Robot.

  1. Okay, so to get started,
  2. let's look at some alternatives you
    have available to monetizing your app.
  3. And when we go through
    these alternatives,
  4. let's look at how easy it is to start
    making money using this alternative.
  5. How it supports a good business model
    where you can make long-term revenue,
  6. and finally, what value this
    monetization model provides to the user.
  7. So, let's start with our first
    alternative, paid downloads.
  8. This is where the user needs
    to pay in order to even
  9. download the app to the phone.
  10. So how about easy to launch for
    paid downloads?
  11. Well perhaps it's kind of obvious
    that this is very difficult to do.
  12. And you have to have an app where the
    user really knows the value of your app
  13. beforehand and is willing to pay for it.
  14. Compared to overall number of apps,
    there are very few that can do this.
  15. So a paid downloads monetization model
    is definitely not easy to launch.
  16. What about long-term revenue?
  17. Well, once the user
    has paid up front for
  18. the app,
    they don't expect to be charged anymore.
  19. So only using paid downloads will
    limit your revenue to the number of
  20. users downloading the app.
  21. So paid downloads has a limitation
    when it comes to sustaining long-term
  22. revenue.
  23. Then what about user value?
  24. A paid download definitely
    has a high use of value.
  25. After all, the user is willing
    to pay up front to get this app.
  26. So they really want it.
  27. All right, let's look at another
    alternative, subscription.
  28. This is where the user pays a certain
    amount regularly, for example, monthly.
  29. So is a subscription monetization
    model easy to launch?
  30. The answer is definitely not.
  31. Again, you're asking the user
    to pay up front, and even more,
  32. you're asking them to pay,
    for example, every month.
  33. It is a huge decision for
    the user to want to do this.
  34. So what about long-term revenue?
  35. Yes, spot on.
  36. The user will continue to pay for
    your app as long as it provides value.
  37. So you will continue to get revenue
    from all users of your app,
  38. not only at the time
    when they downloaded it.
  39. And what about user value?
  40. Same thing as for paid download.
  41. You have a user that is willing to
    make an up front financial commitment
  42. to use your app.
  43. So obviously, your app provides a very
    specific and high value to the user.
  44. And both these monetization models,
    paid downloads and
  45. subscription, can be configured in
    the Play store when you deploy your app.
  46. Okay, now let's look at
    displaying ads in your app.
  47. Is this monetization
    model easy to launch?
  48. Yes it is.
  49. In particular, if there is no charge for
  50. the app, users understand that you
    have to make money from something.
  51. What about long-term revenue?
  52. The answer is yes to this one too.
  53. As long as your app is used,
    you will be paid for displaying ads, so
  54. this supports a long
    term business model.
  55. What about user value?
  56. As it turns out,
    ads do provide great value to the user.
  57. As we will see, AdMob, the platform
    that we will look at in this course,
  58. is very good at serving ads
    which are relevant to the user.
  59. And ads which are relevant
    to you is a good thing.
  60. And now for the last alternative we
    will look at, in-app purchases enable
  61. you as a developer to advertise and
    sell digital goods right in your app.
  62. For example, they can mean new levels or
    items in a game.
  63. So is this model easy to launch?
  64. Yes, in-app purchases
    are very easy to launch.
  65. The user does not have to pay for
    anything up front.
  66. What about long-term revenue?
  67. Well since you can offer and engage
    the user with new digital goods all
  68. the time, in-app purchases have
    a great long-term revenue potential.
  69. Then what about user value?
  70. Well since the user is engaging with the
    app, and you control what to advertise
  71. and sell, it will be very relevant to
    the user, so great user value as well.
  72. All right, so those are some of
    the monetization alternatives available.
  73. And as you can see, ads and
  74. in-app purchases provides a great
    way to make money from your app.
  75. They are easy to launch, they provide
    great long-term revenues, and
  76. they align well with the user values.
  77. And in this lesson,
  78. we will be specifically be
    looking at displaying ads.