Ever wondered how those apps on your phone make money? Here’s a straightforward guide on calculating app revenue, an essential read for anyone dipping their toes into app development or ASO.
Understanding App Revenue Streams
Before we calculate, let’s understand where the money comes from:
– In-App Purchases: Selling virtual goods or premium features within the app.
– Advertising: Earning from ads displayed in the app.
– Subscriptions: Recurring payments for ongoing access to services or content.
– Paid Apps: Direct revenue from the app’s purchase price.
– Affiliate Marketing: Earning commissions by promoting other apps or services.
Basic Revenue Calculation
The simplest way to estimate revenue is through this formula:
Revenue = Number of Users x Average Revenue Per User (ARPU)
But how do you find these numbers?
Getting the Numbers
– Number of Users: Use analytics tools or app store insights to get daily or monthly active users.
– ARPU: This can be trickier:
– For ads, ARPU might be calculated as Total Ad Revenue / Number of Users.
– For in-app purchases or subscriptions, sum up all earnings and divide by the number of users engaging with these features.
Deep Dive into Advertising Revenue
If ads are your main gig:
– eCPM (Effective Cost Per Mille): Revenue earned per 1,000 ad impressions.
– Fill Rate: Percentage of ad requests that are filled with ads.
Ad Revenue = (Total Impressions / 1000) x eCPM
Using ASO to Boost Revenue
Here’s where app store keyword research comes into play. Boosting visibility through ASO can significantly increase your user base, thereby potentially increasing revenue.
Steps for Effective ASO:
– Keyword Optimization: Use app store optimization tools free or invest in apple app store keyword research to find high-traffic, low-competition keywords.
– Conversion Optimization: Improve your app’s store listing with compelling visuals and descriptions to convert views into downloads.
Why Apple Search Ads Optimization Matters
Running apple search ads can drive high-intent traffic to your app’s page. Optimizing these ads can lead to a better ROI by targeting users already searching for related keywords, thus potentially increasing your aso traffic.
Calculating Potential Growth
Consider this scenario: If through ASO, you increase your downloads by 10% and engagement by 5%, how does this affect revenue?
– New Users: Current Users x 1.10
– Increased ARPU: Current ARPU x 1.05 due to better engagement.
Use of ASO Companies
Outsourcing to an app store optimisation company or app store optimization company can streamline this process. They have the tools and expertise to maximize your app’s visibility and, by extension, its revenue.
Real-World Application
Let’s put this into practice. Imagine you have an app with:
– 10,000 monthly active users.
– ARPU of $0.50 from various revenue streams.
Monthly Revenue = 10,000 users x $0.50 = $5,000.
Now, if ASO efforts increase your user base to 11,000 and ARPU to $0.525, your new monthly revenue would be $5,775. That’s a $775 increase just from optimizing your app’s presence!
Conclusion
Calculating app revenue isn’t just about counting downloads or ad views; it’s about understanding and optimizing every aspect of your app’s ecosystem. From leveraging app store keywords research to enhance discoverability to fine-tuning your revenue model, every step you take can lead to significant financial growth. Remember, the key to increasing app revenue lies in continuous optimization, user engagement, and smart marketing strategies. With the right approach, your app can not only survive but thrive in the competitive app marketplace.