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More publishers are generating $1 million or more in revenue on the App Store than on Google Play, according to data from Sensor Tower.
Sixty-six iOS publishers met or passed $1 million in app revenue in 2016 — that’s 1.7 times the 39 publishers on Google Play that achieved the same feat, and double the number of App Store publishers that made $1 million or more in 2015. Though not representative of all publishers’ experiences, the results highlight the higher earning potential of App Store publishers; this could attract more publishers to the iOS platform.
Apple’s continued lead in revenue generation for publishers is unsurprising. US iPhone users spent an average of $40 on in-app purchases and premium apps per device in 2016, up from $35 the year before. Additionally, the iOS App store is projected to remain the single-most lucrative app store globally from 2016-21, according to App Annie, generating global revenues of nearly $60 billion in 2021, compared with $42 billion for Google Play.
The success of more varied categories in the App Store may be giving iOS publishers more opportunities. For example, 75% of the publishers that hit or surpassed their first $1 million in revenue on Google Play in 2016 were games publishers, compared with 47% on the App Store. Lifestyle apps — such as Bumble and Coffee Meets Bagel — comprised 8% of apps on the App Store that hit or surpassed the $1 million revenue mark, compared with none on Google Play. The increased avenues for revenue may be suiting App Store publishers well.
App developers long considered the "pay once and play" model — in which users pay up front an app and aren't prompted to make in-app purchases — the best way to generate revenue. But as more "free-to-download" apps entered the market, users increasingly opted for these experiences. These apps offer microtransactions for in-app goods and services, and in-app ads.
As the app ecosystem expands further, it will become increasingly challenging for developers to compete in a crowded market. Overall, global gross app revenue will double to reach $102 billion by 2020, according to recent projections by App Annie. As a result, app monetization strategies need to shift at least as quickly as consumer trends and preferences in order for developers to capture a piece of this growing market.
Laurie Beaver, research analyst for BI Intelligence, Business Insider's premium research service, has compiled a detailed report on app monetization that explores the top app monetization strategies under user- and advertising-paid approaches, and the growing combination of both. We will also look at emerging trends that could help developers navigate the fiercely competitive app ecosystem, and address the potential barriers that developers will have to overcome to reap the benefits of the multi-billion dollar market.
Here are some of the key takeaways:
- The app ecosystem is expanding quickly, and it's becoming increasingly challenging for app developers to compete in a crowded market.
- To capture a piece of the growing market, app developers must adapt their strategies at least as quickly as consumer trends and preferences change.
- Developers can choose a user-paid or an advertising-paid approach to monetizing their apps. Different monetization strategies work best with different apps.
- There are a number of widespread challenges that developers must contend with both before and after they enter the app market.
In full, the report:
- Provides key factors driving the expected growth of global app revenue
- Evaluates the top app monetization strategies
- Looks at emerging trends to help developers navigate the app ecosystem
- Explains the challenges that developers face to compete in the app market
- And much more
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- Subscribe to an All-Access pass to BI Intelligence and gain immediate access to this report and over 100 other expertly researched reports. As an added bonus, you'll also gain access to all future reports and daily newsletters to ensure you stay ahead of the curve and benefit personally and professionally. » START A MEMBERSHIP
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Credit: BI Intelligence