So you’ve built an app, and now you’re eyeballing those hefty App Store fees wondering if there’s a way to keep more of your hard-earned revenue. Let’s dive into the world of App Store economics and explore strategies to minimize or even avoid these fees.
Understanding App Store Fees
Before we navigate around these fees, let’s understand what we’re dealing with:
Apple’s App Store: Typically takes a 30% cut from app sales and in-app purchases, although this can drop to 15% for subscriptions after the first year or for small businesses under certain programs.
Google Play Store: Similar to Apple, it takes a 30% commission, but has also introduced programs to reduce this under specific conditions.
Strategies to Avoid or Reduce App Store Fees
1. External Payment Systems
One of the most straightforward ways to bypass App Store fees is by not using in-app purchases at all. Here’s how:
Direct Users to External Websites: For services like subscriptions or physical goods, direct users to purchase from your website. Apps like Netflix or Spotify might have users sign up on their site, then log in on the app.
Use StoreKit External Purchase Link Entitlement: On iOS, you can link out to an external site for payment, but remember, Apple still takes a commission, albeit reduced, for any purchases made within a week of clicking the link.
2. Leveraging Email Communications
Apple has loosened its policy, allowing developers to communicate with users via email about alternative payment methods. This means:
Promote Outside Payment Options: You can now inform your users through email about cheaper or alternative payment options outside of the app, steering clear of App Store’s payment ecosystem.
3. Subscription Model Adjustments
Subscriptions are a gray area. Here’s how to play it smart:
First Year Strategy: If your app’s revenue model is subscription-based, remember that after the first year, the App Store fee drops to 15%. Structure your offerings to take advantage of this.
Avoid In-App Subscriptions: If feasible, avoid in-app subscriptions altogether by requiring sign-ups on your website.
4. App Store Small Business Program
If your app’s annual revenue is less than $1 million, enroll in this program:
Reduced Fees: This program cuts the App Store commission to 15%, significantly reducing your burden.
5. Focus on Apps That Don’t Require In-App Purchases
Consider developing apps where the primary function doesn’t necessitate in-app purchases:
Reader Apps: Apps for content like books or magazines can avoid fees by only allowing access to previously purchased content.
6. Legal and Policy Changes
Stay updated with policy changes:
Settlements and Policy Shifts: Apple and Google occasionally adjust policies due to legal pressures or competitive reasons, which might offer new avenues for fee avoidance or reduction.
Considerations and Trade-Offs
While avoiding fees might sound appealing, consider these points:
User Experience: Directing users outside the app for payments can complicate the user experience, potentially decreasing conversion rates.
Lost Benefits: By not using in-app purchases, you miss out on Apple or Google’s promotional tools, seamless payment integration, and user trust associated with these platforms.
Compliance and Risk: Ensure your methods comply with the app stores’ terms. Violating these can lead to your app being removed.
Fees are not the enemy
Apple rewards apps that bring more revenue with more visibility, they want money after all. So think about the Apple fee as a cost of marketing to get users.
Conclusion
Avoiding or reducing App Store fees requires a blend of strategic planning, understanding current policies, and sometimes, accepting some level of commission for the benefits the app stores provide. While the 30% might seem steep, the exposure, trust, and infrastructure provided by Apple and Google can often justify this cost, especially if you’re not in a position to handle global payments and customer service on your own. However, for those looking to maximize revenue, employing a mix of external payment strategies, leveraging email for direct marketing, and staying abreast of policy changes can help navigate around or minimize these fees. Remember, the key is to balance cost-saving with user convenience and compliance with app store guidelines.