Mobile phones have become an integral part of our life whether to book a cab, order a pizza, chatting with your spouse, or have a meeting with a client, the applications on a mobile phone can serve multiple purposes easily. It is obvious that every new business prefers to launch its own mobile application as a business strategic move and there are many who are contemplating getting an app for their business.
However, what needs to delve upon is whether all these businesses succeed by mobile application development for their business and get a huge hit? Unfortunately, the answer is a big no. The reason is obvious, there are thousands of apps that get launched every day and most of them are of the same genre, business, or domain. There is a huge competition, and in this rat race, a few survive.
Now you must be wondering what makes an app successful?
There are some generic reasons like Interactive UI & UX, easy payment, good customer relationship management, regular updates, etc. However, in this article, we are going to discuss an out-of-the-box feature “Subscription Model” in (Mobile Apps Industry) mobile apps that are currently ruling the business of the mobile apps industry.
The subscription model is not a new name in the Mobile Apps Industry. But it is during the recent years when it gets huge fame and both buyers and sellers start focusing on it. You must have heard of names like Netflix, Amazon Prime, Hotstar, Spotify, Dropbox, and others that use the software-as-a-service (SaaS) technique by offering monthly or annual subscriptions.
In this business revenue model, when a user subscribes, he has to pay a monthly or annual fee for accessing your app. The user will get the app’s data and services to use then. The common reasons why the business owners prefer for subscription model are:
- They want to access the additional content by an app.
- They get a discount offer for subscribing in-app.
- The free trial of users ran out and they still want the content or services
- Users want to use the app offline
- Access to additional tools/features within the app
- Accessing app on multiple devices
- Able to add users/collaborate
Read more: Importance of MVP in Mobile Application Development
Now let’s know in more detail about the benefits of the subscription model in apps:
1. Apple gives preference to the subscription-based apps:
The previous year, Apple introduced a change in-app store which means that app subscription business models over others by offering developers an 85/15 revenue split (rather than the standard 70/30 split) for subscriptions lasting over a year. It implies that Apple wants to reward for keeping your customer for a long time.
This cut from a pie is a huge deal for the Apple App developers.
2. Boost in Revenue:
The subscription facilitates apps that have observed more revenue per user that the apps adopting other business models.
In fact, as per a study, an app with a subscription facility can earn 2-3 times more than those apps which are only relying on advertisements or a pay-to-download business model. Also, they earn 50% more than those apps which offer in-app purchases for revenue.
3. A source of reliable income:
The advertisement and in-app purchase model are quite less reliable in comparison to the subscription model. It is a steady source when you know your revenue per user. The cash flow will always increase with the addition of each new user.
4. Discounts for a long-term subscription:
A customer always likes to save money and hence most of the users opt for a subscription plan which is less costly for them. Therefore, you can offer discounts or offers when users are subscribing for 6 months or annually.
5. Offers to increase customer retention:
If a user churns or unsubscribes from your app, you may be able to rope users back in by providing their future monthly subscriptions at a discount.
Read more: End-To-End User Testing Complete Guide & Frameworks
6. More Engaged Audience:
When a user pays money for content on an app, it is obvious that he is going to take full use of it. So, user engagement increases. However, it is your concern that they get what they paid for. If users don’t feel they are getting enough value from your app, they’ll unsubscribe as soon as they can.
Read more: How Much Does it Cost to Develop an App in 2023?
At Amplework, the best mobile app development company, we can entice the customers for your business by developing captivating apps by our expert mobile app developers. Please share your requirements and rest we assure.