There are millions of apps available on the Google Play Store and Apple Store and the space for creating and publishing more apps still exists. 33.6 billion apps were downloaded in the first quarter of 2020 and this number is increasing with each passing day. A well-built app has the potential to earn billions of dollars in revenue each year. However, such apps are rare. Having said that, it in no way means that apps do not make quite a good sum of money. The return on investment after developing and publishing an app is sometimes as good as winning Lottery Sambad. Even though the users know that the apps make money, no one has a clear idea of how much does an app really make? This post will throw light on how much an app really makes.
How Much Money Can An App Make?
The daily revenue of the top 200 apps on an app store is approximately $82,500. If we consider the top 800 apps of the app store, the daily revenue of the apps comes down to $3,500 which again is better than the first winner of a Teer Result. However, how an app really boils down to many different elements.
For instance, a gaming app can easily generate a revenue of $22,000 on a daily basis. On the other hand, the daily revenue of the entertainment app is approximately $3000. Different apps generate revenue for the obvious reason. However, it cannot be denied that a well-developed app can earn a fortune in revenue.
The revenue that an app makes also depends upon the region where it is being downloaded the most. Apps published in the Apple app store generate more revenue because they are mostly available in the region with high-income people who tend to spend more on app-related purchases. On the other hand, apps published on Google Play Store earn comparatively lesser revenue per user because they are more popular in underdeveloped and developing countries. The combined revenue of the apps for Android and iOS in 2021 was $133 billion. This revenue saw an increase of 19% from 2020. 63% of the revenue of the app market came from iOS users. Breaking it down further, 67% of the revenue of the apps came from the gaming apps alone. In 2016, the annual revenue of the apps was only $43.5 billion and this increased to $133 billion in 2021.
If we compare the revenue the apps generate on the basis of the region, China tops the list. In 2021, the app revenue from China alone stood at $56.7 billion. Other regions that play a key role in the app revenue include the United States, Japan and Europe.
How Does An App Earn Money?
The impressive revenue of the app market can make one question how exactly the apps earn money. There are multiple ways through which an app can generate revenue. One of the most popular income streams for the apps to earn money includes in-app advertising. In this method, even though the apps are free to use, the users are shown advertisements within the app and the makers earn money by displaying those advertisements. The other common way of making money through apps includes in-app purchases and the freemium model. In this model, the users are free to use the app but need to pay some money to purchase different aspects of the app.
The third way of making money includes the subscription model which is often used by apps that deal with audio and video content like Netflix, Spotify and Google music. However, the subscription model works best only for the big names and not for the small players of the app market. Other ways of making money from the apps include sponsorship, crowdfunding and affiliate links.
The trend of the past few years clearly indicates that developing apps create a sure-shot way of earning money. However, the money that an app makes is not something that is completely consumed by the developers. Apple and Google take a good percentage of the revenue that an app makes. Currently, these companies take up to 15-30% of the revenue that the apps generate on their platform. Even though there has been an effort to lower this percentage, it is unsuccessful till now.
