How to Create An App and Make Money in 2024

Mobile applications have emerged as a critical business tool, providing businesses with another platform for sales generation, service enhancement, and income creation. The emergence of these mini devices has started eclipsing the use of powerful desktop/laptop devices, and hence, faster development of mobile applications has occurred. 

Whether your goal is to improve services or sell products, the ultimate objective is often to make money from apps. On the other hand, there ought to be a well-conceived plan even before one sets out to develop an application.

This article describes the entire process of creating a mobile application with income-generating goals. If you don't know how to proceed with the steps of developing an app, do not worry, as we have already done a comprehensive write-up on how to build a mobile app. 

What's the need of this guide? 

A lot of people think their businesses will start making money the moment they take them online. But that is not true. The online market is as much competitive as the physical one. Therefore, when design, development, and marketing of such an application is carried out, the assumption of being present alone is not enough. 

We have compiled useful information for people interested in making money from application creation. This guide will include popular monetization models for mobile developers to consider. 

Let's start with how to earn money by developing a mobile application.  There are four ways to earn money with mobile application development. 

How do You Make Money by Creating an App?

Mobile app development has become a lucrative field, with numerous opportunities to earn money through various monetization methods. The upcoming section will explore popular strategies for generating revenue from your mobile apps.

Whether you're a third-party service provider or aiming to sell services directly through your app, choosing the right monetization approach is crucial. The success of your app's revenue generation depends on aligning your monetization strategy with the type of app you're developing.

When you develop a mobile app, you can choose different monetization options to start earning money. You can make money through the following methods. If you are not selling any services or products, then you can still earn money. Let's look at some popular ways to earn money with mobile app development. 

Popular Monetization Strategies 

eMarketers published a report estimating that, on average, a user in the U.S. spends around four hours on mobile internet. They found that over 80% of that time is spent using applications. Overall, people spend a significant amount of time on mobile apps. To put it simply, customers love apps, which is why the development market size is continuously growing.

 In this scenario, where you can reach your potential users effectively through your app, integrating a successful monetization strategy can bring many benefits. We'll discuss some monetization strategies that are quite popular, and we'll also learn how you can integrate them into your application

Popular App Monetization Models

1. In-App Advertising

In-app advertising is one of the most popular monetization strategies, especially for developers who are not directly selling services but have a large user base. This model is ideal for those looking to leverage their audience to promote products or services.

With in-app advertising, if your mobile app attracts decent traffic, you can partner with well-known service providers to monetize your app. 

For example, you can join programs like Google AdSense, which displays relevant ads to your users. Ads can appear in various formats, such as banners or interstitials, and you earn revenue based on clicks, views, or installations generated from your app.

This approach is particularly effective for apps that act as third-party partners, guiding users or promoting services rather than selling products directly. By incorporating ads into your app, you can effectively generate income while enhancing user experience.

2. In-App Purchase

In-app purchases exemplify the freemium strategy, where users can explore your service for free before being converted into paying customers by offering exclusive features or services. This strategy is highly effective and one of the most popular methods for turning free users into paying ones. It is also a leading revenue generator for mobile app developers.

You can launch your app with limited features and then offer in-app purchases that allow users to access exclusive or full features and content. A common example of in-app purchases is found in gaming apps, where users unlock special content and features through purchases.

3. Sponsorships

If your platform has gained significant popularity, consider adopting a sponsorship model. This approach allows you to attract brand sponsors, similar to how popular YouTubers collaborate with various brands. Partnering with companies can be highly lucrative, especially if you maintain an engaged user base. Compared to traditional advertising, sponsorships offer substantial financial benefits.

When you partner with brands to exclusively promote their services, they may compensate you generously. This strategy not only generates additional revenue without the clutter of 

banner ads but also enhances the user experience by providing a more integrated approach.

Developers can negotiate sponsorship deals that place products or services in prominent sections of their apps. This model creates a win-win situation for both developers and sponsors, fostering a relationship that benefits both parties.

4. Affiliate Links 

Affiliate marketing can be a powerful method for app developers to monetize their creations. Developers can partner with relevant affiliate programs to incentivize users to download and use their apps. Affiliate marketers promote the app to their audience, driving traffic and potential conversions. The developer earns a commission when users make purchases or sign up for services through affiliate links. 

 It is a popular way for app developers to generate extra revenue. It involves partnering with affiliates or referring users to earn a commission on each successful sale or action. In return, you give them a commission for every successful sale or action that comes through their efforts.

5. Selling Merchandise Model 

The selling merchandise model is a strategy in which app developers take advantage of their app's popularity by selling physical products. You have a theme, characters, or even a brand that people love, and now, you can offer them relevant products they can buy. It's all about expanding the revenue beyond the app itself and building a deeper connection with users.

Assume you develop a mobile game that's popular for its adorable animal characters. The developers could start selling plush toys of those animals, phone cases with their designs, or even T-shirts with the game's logo. These items can be sold right from the app or through an online store. 

6. Transaction Fees Model

Due to the increasing prevalence of online payments, the demand for payment systems has been rising for some time. Companies worth billions of dollars are emerging daily by developing payment services. You can develop a payment system and charge third-party service providers to integrate your payment system.

Nowadays, various payment systems are in circulation. While every service is being digitized, the demand for payment systems continues to grow. 

7. Collecting and Selling Data Model

Data is the new gold. When we examine artificial intelligence technology today, we see that its rise is largely due to the abundance and growth of data. This wealth of data is enhancing the power of today's most popular technologies, enabling sellers and business owners across various industries to offer relevant insights.

A great example of this is the Facebook app, which analyzes your browsing habits and patterns to store your data. This information helps businesses reach the right audience, creating a significant market. In this context, you can develop an app for collecting and selling data, or integrate it into your overall strategy. 

This way, you can provide various services while also gathering audience data, contributing to their monetization. Ultimately, this approach allows you to generate revenue from the data you collect.

In-App Purchases vs. a Mobile Site

When we develop a mobile application, one of the most critical decisions is how to monetize it. While we have discussed various monetization methods, the most common and effective approach is in-app purchases.

 In-app purchases are often one of the most effective monetization methods. However, it's important to have a separate discussion about this.

In-app purchases work by offering users limited services or introducing specific features. If users want access to more exclusive features or services, we charge them for those additional benefits.

This approach, which involves offering extra features, content, or virtual goods within the app, is particularly effective in games.

Let's assume you have a website, and you decide to convert it into an application. This could potentially increase your revenue generation even further.

According to a report, buyers prefer mobile applications over mobile websites. Convenience plays a significant role here.

iOS vs. Android In-App Purchases

A study by Sensor Tower in 2021 found that iOS users spent an average of $131 per year on mobile apps and games, compared to $69 for Android users. This suggests that iOS users are more likely to spend money on in-app purchases than Android users. 

It would also be a wise decision to overlook the Android user base. In terms of total users, Android holds a solid market share, and neglecting it could mean missing out on a vast audience.

 In this context, you can adopt a cross-platform development strategy. By developing your application on a single codebase, you can run it on different platforms while adding various features simultaneously.

DIY Vs. Hiring an Individual App developer Vs. A Team of App Developers?

When it comes to creating a mobile app, you have several options: DIY development, hiring an individual developer, or assembling a team of app developers. Each approach has its pros and cons.

DIY development

It is the most cost-effective choice, as it eliminates hourly rates or project fees. Plus, it also provides complete control over the app's design and features, along with the opportunity to learn coding and app development. 

However, this approach can be time-consuming, especially for those new to coding, and may lead to limited expertise in critical areas such as user experience and app store optimization. Additionally, a lack of experience can slow down the development process and increase the risk of errors.

Hiring Developer

On the other hand, hiring an individual app developer can be a more affordable alternative, particularly for smaller projects. It allows for direct communication, which can facilitate problem-solving and provides flexibility in negotiating terms. 

However, a single developer may have limited resources and expertise, which can affect the project's timeline and quality. Relying on one person also creates a risk of dependency, potentially leading to delays or significant rework if that individual becomes unavailable.

Outsourcing

Finally, hiring a team of app developers brings specialized expertise to the project, ensuring high-quality results and scalability to adapt to changes in scope or timeline. Additionally, having multiple developers minimizes the impact of individual team members leaving the project. 

Nevertheless, this option comes with higher costs and increased complexity in management, as effective communication and coordination become essential. Furthermore, the larger the team, the greater the potential for miscommunication or conflicting priorities.

Application Development Platforms

When it comes to building mobile applications, choosing the right development platform is crucial. These platforms streamline the development process, offering tools and resources tailored to various needs and skill levels. Here's a breakdown of some popular app development platforms:

Native Development Platforms

1. iOS (Swift/Objective-C): This platform is specifically for developing applications for Apple devices. It offers high performance and access to all device features, but requires separate codebases for iOS and Android.

2. Android (Java/Kotlin): Similar to iOS, Android development allows for deep integration with device features. However, it also requires managing two codebases for cross-platform functionality.

Cross-Platform Development Tools

• React Native: Developed by Facebook, React Native allows developers to use JavaScript to build mobile applications for both iOS and Android. It combines the performance of native apps with the efficiency of web technologies.

• Flutter: Google's Flutter uses the Dart programming language to create natively compiled applications for mobile, web, and desktop from a single codebase. It is known for its expressive UI and fast performance.  

No-Code/Low-Code Platforms

• Adalo: Adalo is a user-friendly platform that allows you to build native apps for iOS and Android without writing code. It offers a wide range of templates and components to help you create visually appealing apps.

• Bubble: Bubble is another no-code platform that enables users to create web applications with drag-and-drop functionality, focusing on rapid development and deployment.

• FlutterFlow: This platform leverages Flutter's capabilities to provide a visual interface for building cross-platform apps. It offers a drag-and-drop builder and integrates with Firebase for backend services.