How Much Money Can an App Earn?

There’s a lot of money in apps. Billions of dollars. But most of this money is earned by certain kinds of apps, and many apps make no money at all. The top-grossing apps in the world may not be the ones you suspect. If you want to maximize your app’s earnings, an app development company will tell you what you should, and shouldn’t do. In the meantime, this article will explain the ins and outs of how apps make money, and will give you some ideas for how your app can become an earner.

The mobile market has grown substantially over the years and industry experts predict continued growth. In 2017, mobile traffic accounted for 63% of total website traffic in the United States, and 3.3 of the almost 6 hours per day that adults spend consuming digital media occurred on smartphones, with desktops, laptops, and other connected devices struggling to keep up. With such impressive numbers, it’s no wonder that Fortune 500 companies and entrepreneurs alike are trying to get a piece of this modern-day gold rush.

If you’re new to the market, looking to enter it, or just have a really cool idea for an app, one of your first questions is likely to be profit-related. Building apps is a difficult task and you will want to be rewarded for all of your hard work. The following overview of mobile app earning potential should give you a clearer picture of how much you can make off your app.

Our agency, Fueled, has experts that can help you determine how to earn money from your app, and how much it can potentially make.

Which Platforms Make the Most Money for App Developers?

First and foremost, you need to decide what platform (or platforms) you want to design your app for. This can greatly affect your earning potential due to differences in market penetration and platform popularity.

In the app world, developers are in high demand and are compensated accordingly. The Android platform is in the lead with an average salary of $97.6K amongst developers. Android is a well-regarded platform because of its continued market penetration. Apple’s iOS platform is not far behind — mid-level iOS developers make about $96.6K a year. It is worth noting that both Android and iOS are “top heavy” in terms of earnings, with much of the total revenue being earned by top developers. Some of the younger app developers in the market have begun recruiting mobile app marketing specialists to help them bridge the gap.

Platforms that aren’t as favorable to app prospectors include BlackBerry OS and Windows Mobile platform. BlackBerry OS descended to a market share of 0.04 percent in 2016, according to Gartner Inc, rendering it more or less obsolete in the consumer market. Joining BlackBerry in dismal decline is Windows Mobile, which was officially laid to rest last fall. While more niche platforms can be profit earners, they should only be considered once your app has proven profitable on a more widely used platform, especially considering the dominant Android/iOS duopoly. Once an app is a proven winner, porting it to other platforms becomes more viable.

What Kind of Revenue Do Apps Generate?

There’s no denying it. Apps are big business. Global mobile app revenue is projected to reach $188.9 billion by 2020, an increase of more than 200% from 2016. Gaming apps dominate the list of top-grossing apps. As of April 2018, Epic Games’ Fortnite makes about $1.9 million in daily revenue, with Candy Crush Saga by King in second place at $1.3 million per day through in-app purchases. Pokemon Go raked in $890 million last year, a slight decrease from the whopping $930 million it made the year prior.

Most game apps are free to download, but the real money is made through in-app purchases. Last year, global revenue from in-app purchases was projected at $37 billion, while paid app downloads only brought in $29 billion. But don’t worry if you’re not a game designer — Tinder and Netflix have managed to top the charts, so there’s still hope. Sort of.

How Much Do Subscription Apps Make?

With over 46 million registered users, Match Group’s Tinder is a great example of an app that is a tidy money earner due to in-app purchases. The Tinder dating app is free to download, but makes money by charging users for bonus features like unlimited swipes, which give users endless opportunities to match. Tinder’s “Passport” add-on allows users to match with users in other locations, while “Boost” allows users to bump their profile to the top of the pile of users in their area. In Q1 of this year, Match Group reported generating over $407.4 million in revenue. Tinder charges $9.99 a month (or $19.99 a month for users that are 28 or older) for a Tinder Plus subscription, and $4.99 for a Tinder Gold upgrade. This approach has made Tinder one of the highest-grossing apps worldwide.

Bumble is close behind with 22 million users and a year-over-year growth rate that’s 60% higher than Tinder’s. Unlike Tinder, Bumble allows only women to initiate conversation on the app, and has also grown to include sister apps for networking and finding friends. The app makes an estimated $172 per minute thanks to its monthly $9.99 subscription option and premium features like Bumble Boost and SuperSwipe.

Pandora, Spotify, and Tidal are also high up on the list of top-grossing apps. Subscriptions generate the majority of these apps’ revenue. Video-streaming apps like Hulu and Netflix operate on subscription-based method as well.

AnchorFree’s Hotspot Shield is an app that has proven useful on a number of globally important issues. The app allows users worldwide to access a virtual private network (VPN). This technology was crucial during the Arab Spring, as it allows users to bypass government censorship. Subscriptions cost users $5.99 a month for a year of service, or $12.99 on a month-to-month basis. Hotspot Shield reached 5 million installs as of January 2017, and remains one of the top-grossing apps on the iTunes App Store.

On a smaller scale, privately owned apps are also generating a significant amount of revenue. The Telepathic, Inc. app Hooked is relatively simple, and yet it rarely strays from the App Store’s top-grossing books category. Users gain access to suspenseful stories in the form of text message conversations through weekly, monthly, and annual subscriptions. The app hooks users in with compelling stories but requires them to subscribe in order to find out the ending.

Personal trainer Kayla Itsines’ Sweat app is a top-grossing app that serves as a great example for beginning app developers. The app provides subscribers with 28-minute workouts, diet plans, and yoga videos. Sweat quickly gained a cult-like following after its release in late 2015 and currently generates $100 million in revenue yearly. Itsines and her husband are worth a combined $46 million.

Apps Aren’t Just for Mobile Phones

Apps have branched out from the cellular platform as more integrated smart devices have entered the market. Smart TVs are a staple in more than 70 million homes in the United States. The most popular apps used on Smart TVs are ones that are appropriate for the medium and already have a very large, existing user base such as Netflix and Hulu. If it makes sense on the platform, it is worth keeping Smart TVs in mind when designing your app. Expansion of platform offerings not only increases exposure for your app but also opens it to new revenue streams.

Picking the right platform for your app is essential

Similarly, video game consoles such as the Xbox One, PlayStation 4, and Wii U have their own app stores. A number of apps can be found on each platform, including Netflix, Youtube, Hulu, and Amazon. Some apps, however, can be exclusive to the consoles such as Spotify and BBC to PS4. These are successful apps offering their services on new platforms to make it more convenient for their users. It’s a good option, but not necessarily a great fit for most people.

Another platform to pay attention to is smartwatches. With wearables becoming increasingly prevalent, it’s no surprise that smart watches are predicted to reach a 51% share of wearable devices sold in 2022, a huge jump from the previous status of 21% in 2016. Optimizing your app to be smartwatch-compatible could likely be a competitive advantage.

What’s the Next Big Thing for App Development?

There are plenty of opportunities for fortune in the app market. The app market has experienced substantial growth since its conception and shows no signs of slowing down. The market may be a bit oversaturated but it’s promising to see that worldwide app store revenue is predicted to reach $110 billion this year, with huge windows of opportunity opening in China, Brazil, and India. Video game apps are huge, multi-million dollar earners, but there is still a lot of money to be made in less complex novelty and productivity apps. Finally, the growing market of smart TVs and the emerging market in smartwatches will further expand the app environment.


Leave a Comment