Learning how app stores earn money from app and game developers is valuable information. As well as this, it is also vital to understand how you will make your money when creating an app. If this is free, how you will do so.
A commission fee is a service charge. It is when part of the revenue of something, for example, an app, is given to whoever is advertising this. The way in which they advertise an app is through an app store.
The idea that they are providing you with a space to promote your application means that they are entitled to a certain amount of the commission. The cost of this all depends on where you decide to put your app.
Frequencies of payments from the app are different for everyone. Generally, if your app is paid, you will get paid after every download.
If it is free, but you offer subscriptions or in-app purchases, the frequency of when you get paid will differ depending on how many people use this feature.
Each app store works differently, from Apple, to Google Play and Amazon.
In May 2018, there was ‘upward of 170 billion downloads’ from the store. Just think how many that is! The most amazing thing about this is they are not solely straight-up paid services. For example, buying a paid app.
Most revenue is collected through free apps. Some applications generate income for stores with the use of in-app purchases or being free to play and download for anyone. As well as this, apps that offer subscription services also contributes to Apple’s revenue.
How do they get money?
So, you may be wondering, how do the app stores get the money through these in-app purchases? Surely the developers get all the money from the app they created.
Apple take a cut of these earnings. Companies like this work off of a revenue split, which is 70 / 30. This would mean that the developer keeps 70% of the money made from their creation, and Apple will take 30%. The split just discussed will be placed on every transaction made on their platform.
Apart from this, another way the app store makes money off a developer’s app is through ads. There are many diverse types of ads, like interstitial (which are full-screen), banners (at the top or bottom of the screen) In-app video ads and so much more. Every time a consumer interacts with this ad, Apple takes some of that revenue made.
Google Play Store and Amazon App Store
Like the Apple Store, the best way to create revenue from the Google Play Store is by using ads or offering in-app purchases. Google Play also make their money by taking a commission fee from every purchase within your app. This is the same as Apple and Amazon – at 30 / 70.
For the Google Play Store, this commission changes from 30% to 15% if you keep any subscribers after 12 paid months of the app being available. This feature is beneficial to smaller businesses or developers who do not have much money and engagement. The extra 15% more they could gain is extremely helpful to. The extra earned revenue can be used for further development.
Every penny counts!
There are a diverse option of ads that you can add into your app to get it monetized. A specific blog article will be written soon by us, explaining these in a lot more detail. So, keep an eye out! Some examples will include:
- Native ads
- Interstitial ads
- Incentivized ads
- In stream video ads
- Push notifications
- Post click landing page ads
There are loads of other different ads that could be used, but these are just a few of the most common and successful ones. Taking time to think about which way you want to make money from your app is a big step and it takes a great deal of thinking to understand properly what is best for you.
Approaching all options is a wonderful way to start.