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The business model of a mobile application in 4 steps

Develop a business model of a mobile application to be successful it requires hard work, effort, and a delicate process of trial and error to understand what the market needs.

Whatever the application you have launched or market you want to achieve, there are four essential functions that must take into account in its business model, all necessary for the application to be successful.

The business model of a mobile application in 4 steps

1. Usabilidad

It is a key element of the business model of a mobile application. When a user opens an application for the first time will take a few seconds to determine what care is, how it works or how you play. In those first moments you’re playing all the effort of development. Users do not usually have a lot of patience, so if the application does not respond intuitively, you’ve spoiled all the work.

In business, as in almost all aspects of life, you only get one chance to make a good first impression. Appreciate!

2. Distribution

Distribution is the necessary work that you have to take to get to the previous step. It’s time to promote your app and create a marketing plan.

Virality

Is the ability to convince users to recommend your application to their friends and acquaintances? This is the most effective advertising, but the most difficult to achieve.

The first step is to remove all obstacles and brakes you may have to recommend the application. Search the easiest and most have sense for your type of application. Make it easy a list of friends, connect to Facebook and Twitter App, allows sending emails, SMS … etc. Reduce friction is necessary, but not sufficient. The hardest thing is to create an incentive and encourage the user to recommend the application.  A good trick is to appeal to the ego or the sense of competition.

But even if you achieve a high rate of manhood, in which each new user recommends that you choose to download another application, you will have the entire problem resolved. Because if you have few users, the growth rate will be low.

Advertising

Advertising depends mainly on investment you decide to do. Through the purchase of advertising space on digital media you can ensure the first generation of users.

The efficiency of advertising is measured by the cost of acquiring a customer (CPA) .This is calculated by dividing the price of each advertising campaign by the number of users who have achieved that action. The lower the CPA will have been the most efficient campaign.

Press

It is the third method of distributing an application. The media are responsible in this case to determine the appeal may have application to the public. All you can do is provide “newsworthy” information to journalists to talk to you.

This method is inexpensive, but not a total control over the actions to be carried out and there is no guarantee of success.

3. Monetization

The economic success of an application and its ability to reinvest in shares of advertising campaigns is measured by the degree of monetization and the ARPU (average revenue per user) it generates.

These are the most common forms of monetization:

Advertising revenue

It is the most common method of monetization, in which the user is exposed to view advertising within the App. When the user is interested in a product leaves the application to the other service. If you are interested, you can reach irritate.  Usually advertising is annoying applications and undermines the patience of the user, so it is a good practice to offer a premium version that is free of advertising.

Typically, the money that the advertiser pays 60% going to the application, but if there are many intermediaries this value could be halved.

Income from shock or premium versions

Download revenues are generated when the user has to pay once for downloading the application as many times as desired. This method can be additional advertising revenue could be your strategy or single strategy. Of these revenues, 30% would get the App Stores.

Purchases within the application

The purchase method within the application is generated when the user, after having tested the application, you realize that could significantly improve your experience with a minimum investment of money, a figure that usually is almost negligible. As with downloads, 30% is for App Stores.

Subscription

It is the method often used by content generation applications in which the user pays a monthly fee. Usually we charge outside the App Stores and suffer their withholding.

4. Engagement

The last factor to consider is the engagement or commitment to the user application. You must measure the number of user sessions and the duration thereof.

All actions and improvements that developers have to stimulate the user to spend more time using the application, as this generates greater exposure to advertising and increases ARPU and virality. A good way to increase the frequency of Use between one session and the next, it is to send alert messages with promotions or news, to remind the user can re-use the app. 

Achieving a community of loyal users is the key to your successful application. But remember that this will have to work well all the above points.

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