Only 42% of Small Businesses Charge for Their Mobile App, New Survey Finds

WASHINGTON, Feb. 27, 2019 /PRNewswire/ -- Double the number of small businesses with more than 50 employees charge for apps compared to small businesses with fewer than 50 employees, according to a new survey from Visual Objects, a portfolio website that showcases work from top creative firms from around the world.

Almost two-thirds of small businesses with more than 50 employees (63%) charge for their app, while only 35% of companies with fewer than 50 employees do.

This means 42% of small businesses with mobile apps monetize their app by charging users.

Small businesses with more employees have more opportunities to market their app and motivate people to pay for it.

Small businesses must devote significant resources to raise awareness about why their app is worth paying for amidst the array of free apps already available in app stores.

Small Businesses Prefer to Monetize Their App Through In-App Purchases

Small businesses pursue two main types of app monetization: in-app purchases or subscriptions and paid downloads.

Over one-third of small businesses (34%) charge for in-app purchases or subscriptions, while 25% charge users a fee to download an app.

Apps can provide an additional channel of revenue for a business, but monetization can be difficult to implement.

"It's really hard to get people to pay for apps," said Joana Kelly, chief operating officer of Small Planet. "There's something about being asked to pay a dollar for an app that is this big barrier. If it's free to download, then people are more willing to try the app out."

There are five models of app monetization: free, freemium, subscription, paid, and paymium.

Although the free model doesn't directly earn revenue, it can be one of the most rewarding methods if the app is popular enough to attract advertisers. 

Nearly Half of Small Businesses Collect User Data From Apps

Nearly half of small businesses with apps collect their users' data, including contact information (47%), location (46%), and payment details (35%).

User data helps businesses improve their app services and provides important insights for advertisers.

While apps can make money through in-app advertisements, some small businesses do not believe in selling user information.

"Offering ads inside the app puts us in a potential conflict of interest with our users," said Omer Yarkowich, vice president of product and marketing at MyPermissions. "In a way, to optimize the revenue from the ads, we would need to leverage what we know of our users, and that goes against our values and mission statement."

Small businesses can, instead, use data from their apps to analyze what customers value and want in their experience. User data is not only used to create targeted ads but also to indicate where an app can grow.

Visual Objects' 2019 Small Business Mobile App Survey included 529 small business owners and managers from the U.S.

Read the full report here: https://visualobjects.com/app-development/top-mobile-app-development-companies/small-business-app-monetization-trends-2019

For questions about the survey, a comment on the findings, or an introduction to the industry experts included in the report, contact Emily Clark at [email protected].

About Visual Objects
Visual Objects is a portfolio website that showcases work from top creative firms from around the world. Use Visual Objects to visualize a firm's projects, which helps you find the right design partner for your business. You wouldn't want to make a hiring decision without seeing a company's quality of work – Visual Objects compiles this work on one easy-to-use site.

Media Contact:
Emily Clark
[email protected]
(202) 840-6682

SOURCE Visual Objects

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https://visualobjects.com