THE NEW WAY TO MONETIZE YOUR APPS!

THE NEW WAY TO MONETIZE YOUR APPS We know you’re seeing plentiful apps and

mobile products on the app store without any monetization. Does it seem to you too that they aren’t looking to make money? And you’re right; they are not interested in hauling out cash from their customers yet.

The method they use for monetization is called ‘differed monetization’ which means ‘not monetizing your product instantly’. Though used widely now, it has its own positives and negatives.

An important thing to remember is that it’s not ‘no’ monetization but just a differed type of it. Having provided the product strategy on many of these models, we have got some tips about how you can use it.

Capital is EssentialThere is no revenue without monetization. A working capital is required to sustain the organization. It is recommended to set aside an amount of capital to draw down on anything that comes on your runway. Any expense that comes in is to be drawn from this account.

Your PlanIt’s a method that is to be used until a pre-defined point. At the idea conception stage itself, you need to consider how you will monetize your app. WhatsApp for this matter is a big example- they used this model and it resulted in an acquisition of $19.

SET YOUR GOAL You need to know when to turn on monetization

and it is highly recommended to set a goal for it. The goals (or boxes we say) fall in a few areas:

Time Box: How much time can you spend on the product? How long will it take to monetize the product, how long can you afford to wait till your capital expense account expires? Set a deadline.

Cash Box: Set aside some capital for expenses and forecast your gross ‘burn’ rate which is the amount of money you spend every day or per week or per fortnight or per month.

User-Base Box: If time or cash isn’t a constraint, then user-base definitely would be. You need to get a majority of businesses on board before your product is viable. If there is a certain number you need, consider targeting for it.

KNOW WHEN TO QUIT When you get to the point that your cash, time or

the user base goal is achieved or you have burned through your cash, you have two options available:

Extend your Runway: You simply add more money to your expense account. This prolongs the amount of time you have to attain your goals. You can utilize venture capital, crowdfunding or even debt funding- whichever you choose, it extends the life of your startup.

Wind it Up: Try and analyze why you couldn’t hit your goal. At least you gave it a shot, so don’t be disheartened!

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