Google is free and still a $120 Billion Dollar Company, ever gave a thought about how a free service can be even valued, well there are 100’s of big brands like Facebook, Instagram, Whatsapp, snap chat, Youtube and lot others valued over Billion offer free service till date.

This Article is for entrepreneurs and wantrepreneurs who would like to know the magic of Mobile Apps on how to make money with mobile apps and make it worth millions and billions by offering free service.

There is generally 2 phase of the Mobile App Business, 1st is from the vision of an app to develop the app, and 2nd is monetizing the App. Deciding on which model of engagement to choosing from Premium or freemium app, let me show you some stats here, According to Statista the Mobile App market has surpassed $462 Billion in 2019 and is expected to double by 2021, and the data also shows the Freemium app has a share of 96% over the premium Apps, and the revenue model of the majority of App categories is lead by Freemium Apps as shown in the Graph. 

how to become a millionaire

Now we know the world is over to free Apps, let’s know how do free apps make money? 

First thing first, App Ideas, the Idea should be something which can help the human race in making their life easier and make them happy. This is not the tough part, almost 79% of founders have themselves felt the pain and identified the gap in the market, worked out the plan and delivered an exemplary product, which was marketed superbly. Acting as a Pain relief it starts getting viral, moreover, if it’s a free product, it becomes unstoppable, and here it delivers success. What after that, the product is viral, how to get the revenue out of it.

Check this Graph, it clearly shows the bifurcation of the Models to earn. 


This clearly states, Advertising tops the revenue model of Mobile Apps, however, we can not overlook the other options too, a successful entrepreneur is the one who analyzes the momentum and digs all the way to revenue from all the four directions.

Let’s dig out deep to understand how to make money from the free apps.

1. Advertising

The Most Favorite and easiest way to cash out your mobile app is to get Advertisements, this can be done directly through an Ad Management from the backend or can be done through a third party network. A lot of App Companies keep in-house marketing team to bring in the Ad Clients, and a lot also prefer to introduce Ad Networks.

Almost 80% of the Free Apps have Ads on their Apps and play a major role in bringing the revenue. 

This has been the easiest approach for an app admin, a huge market of an ad network is already out there. As per Marketing Genius Neil Patel  Affiliate marketing has topped the revenue model for an internet entrepreneur, the Models includes pay per purchase, pay per impression, pay per click, and pay per instance. 

The Ad placements are categorized in 4 ranges. 

  • Interstitial Ads
  • Banner Ads 
  • In-App Video Ads
  • Native Ads. 

To dig deep further, let me walk you through the details of every range, to start with these can be managed by the backend or can be just a network placement where you just need to give place for the ads. 

Interstitial ads:

interstitial ads

This is one of the most used placements and highest revenue earner, it is a full-screen Ad which pop’s up covering the entire page with a cancel icon on the top corner. This usually is embedded with a link which acts as a click to action button, this gives a full opportunity to the advertiser to display the service, a lot of app owners have also restricted the users to cancel the ad for a couple of seconds making the user view the ad for a specific amount of time.

App Owner can decide on when to display the ad after a user flows to a specific screen or transaction, in the first, or anytime which helps in making the most out of the ad. 

Banner ads:

banners ads

These are some ads which are placed continuously in the app on a round-robin basis, specific positions are reserved for these ads, majorly news, blogs or content delivery apps offer these products. This also works great with eCommerce with the ads related to a product of their own inventory. This can be monetized as per the business needs, pay per click and pay per impression both are the best way to in-cash this model, and the best part is it does not bother the end-user.

In-app video ads:

in app video ads

One of the fastest-growing Ad channels, in-app video, this helps the advertiser to demonstrate the product, majorly restricted to get closed before a specific time. The advertiser pays more on these kinds of ads compared to other ranges. A lot of Gaming Apps use this channel to promote their products by giving a demo and then giving trial access. These again can be monetized by Ad Network or can be maintained from the backend. 

Native ads:

Keeping it as natural as it can be is the most strategic way to display the ads, Native ads, are designed in a way that it acts as a part of the app itself, tagged with a small label as ads can hardly be distinguished by the main product of the app. This bothers the users least, majorly used by products and content delivery Apps this has been the most liked ad channel, the revenue is less though, still liked by app owners. 

So In a Nutshell, if you see a small calculation here, if you earn $0.10 for 1 action and you make 400 Actions every hour, you can be a millionaire in 3 years down the line.

2. Subscriptions

Saas Model is the most common model and most rewarding model for making money from Apps. There are several strategies that app owners have introduced in a while now, some offer free usage of the product for a specific time. Once the user gets used to it, they bring the user to a point where the subscription becomes a necessity for the app user. A model is also where users offer a range of services for free and enhanced features to subscribers only to compel the users to buy a subscription. A lot of service providers have bifurcated the products, a list of service and specific no. of users stays always free and an enhanced comes at a cost, users when are small they use it for free and when they grow they need an upgrade to a paid subscription model. Majorly used by ERP products, cloud services, Video, and Audio Streaming, some dating apps, and many others.


Payment terms can vary based on the Operating system For Android users, the transaction fee is less as it allows third-party payment gateway in all the scenarios, unlike Apple store, they majorly charge 30% of the cut from the amount and after a year, this percent goes down to 85%. This is a model that ensures you have a great passive income for a longer time. This model is considered a direct revenue model, still is used by not more than 5% of Apps on the app store. These are also called as In-app purchases, you buy it right in the app itself and start using the product then and there. 

Let’s do a calculation here if you are charging $9.99 for every subscriber you just need 100,000 users to achieve your first million, now it’s up to the App admin how many times he can multiply that. 

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3. Selling Merchandise

eCommerce Business is booming, giving a platform where sellers and buyers come face to face and facilitating them with all the support required is one of the best and booming ways to make money from buy and sell apps, we all know where Amazon and Alibaba are now and from where they started, offering a free service to buyers and sellers and only charging them on transactions is one of the best ways to monetize the app, making it user-friendly rewarding the users to make purchase keeps them coming back, this is one of the shortest ways to make million, on an avg. a Buy-sell platform charges anywhere between 10% to 25% of the transaction depending on the merchandise, so if you have a $10 Million of sales without keeping an inventory you become a millionaire. 

selling merchandise

4. Affiliate Marketing

This is one of the best ways to book revenue, right in your app place affiliate products where users click and move to the actual selling site, and when they purchase the product you book a profit, simple and clean, 

These are further categorized as mentioned below. 

  • Cost Per Acquisition– In this, once the purchase is made you get your cut, once the advertiser’s transaction is completed or an app is installed as per the decided amount you get the amount. 
  • Cost per Click– In this the revenue is booked on every click and visits from your app to the advertiser’s app or web. 
  • Cost per impression– Once the user displays the ad, every time it is displayed the amount is added, this can be less but can be more in numbers. 

Related: 10 things to plan when developing a mobile app

The Margin money can range from $0.10 to $25 depending on what the advertiser product is and what your niche is, for sure one of the best ways to book your first Million. 

affiliate marketing

5. Data Analytics

We all know what data means to an organization, working on Big data to understand the behavior of the users has gained huge popularity and the service is highly paid, these are used to offer relevant ad management which improves the quality and increases the engagement percent, this has helped the market researchers to deploy more relevant types of ad, it plays a major role for Native ads and banner ads. 

data analytics

Moreover, the Data also prepares itself to be available for marketing purpose where email marketing is targeted as per the user’s preference of niche, it helps for your app marketing also, a majority of big companies add apps to their portfolio like these to understand the user preference and plan their marketing accordingly. 

You can be one of the same, an app like this can be worth millions in a short time once the user base is increased. 

There are two ways to benefit from this model. You can either track what users do and sell data to outside companies and researchers, or you can use the raw data for your own purposes.

6. Funding 

This is the ultimate way to become a millionaire, get your App designed and developed once the product is ready, start acquiring users, create a rock-solid pitch for Investors or crowdfunding, get the Money and invest in your app, it will make you a Millionaire in just a matter of time, and this can be as easy as written if you have the right product right strategy for marketing and right people to pitch, almost all the Mobile App based business owners have seen their first million by selling their equity. 


7. Selling your App

This has also been one of the most promising ways to make money from mobile app, yes, Make it, market it and sell it to a big brand, here you go, see yourself a Financial free person, it is same like finding a funding partner, there are several Giants in the market always looking to acquire businesses in there niche or a niche where they are willing to expand, the easiest way for them is to acquire an already successfully running business. A lot of Entrepreneurs have become investors after selling their App to Big Businesses. 

selling your app idea

To Summarize it. 

We can see huge competition in the market of Apps, however, we also can see the stats, every year we are seeing an increase of 30% in the App Model business, and yes, the smartest would survive longer, a rule of nature and it applies here also, to be very honest becoming a millionaire is a dream of millions but who achieve them is the one who takes risk, this is why we see out of 100 dreamers only 1 person succeed, it’s all about focusing on what you want and what to do about it.  

As per the Techcrunch, the Market of App will be tripled by 2022, so it is the right time to launch your first app and make money from mobile apps. 

To close the Topic, it is very important to understand what you want and how you want, there are several ways to earn from your mobile app and this is something that you need to ensure right from day one, which is the plan of your mobile app development, try out our platform or hire a developer it is important to ensure they understand your business requirement and based on that the app product is developed and in a similar way the marketing is done if you can ensure everything falls in the right place you are ready to live a life of a millionaire, you can check how much you does it cost to make a mobile app.