These days, there are mainly two ways to make money off your app. You can either sell your app for a fixed price or you can make money off of ads and a freemium business model. Nowadays, going down the freemium route is preferable for startup business and newbie app developers alike.
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The freemium model simply makes your app more marketable and accessible to whoever your target audience is. Apps that can be downloaded for free usually generate their income through a combination of ads and supplementary features that can be unlocked for a small price.
However, making a freemium app isn’t as easy as just filling your app with ads. As a developer, you have to make sure that you’re striking a delicate balance between app functionality and ad integrity. If you’re going to offer your app for free, you have to make sure that not only can you keep your users’ attention, but also their trust.
Because as a developer, one mistake can be all that it takes to lose hundreds, maybe even thousands of users at a time. Building a relationship with your users is one of the best ways to maintain a freemium business model. To do this, make sure to obey the following rules:
Don’t be obnoxious with your ad placement
Ads are the best way to make money online. Websites and YouTube personalities alike receive quite a bit of their revenue from ads. Freemium apps are no exception. Some of the highest-earning apps in the world follow the freemium business model, after all.
In fact, do you remember Flappy Bird? That app made $50,000 a day when it was still offered for download. The app’s creator never intended for the game to make so much money, but he achieved those figures because the game was addicting and fun.
Now, it’s easy to assume that the reason why the app made so much money was because of strategic ad placement. However, it’s worth noting that the app only used a simple banner ad to generate revenue. The ads on Flappy Bird took up 15-20% of the screen, a small and unobtrusive amount. This allowed users to focus their attention on the app without getting easily distracted.
If you’re going to design an app, make sure to give your users a reason to keep coming back. Users should be spending time in your app because they enjoy its features and not because of anything else. Be careful of placing too many ads. Obnoxious ad placement can push users away by interrupting an otherwise flawless experience.
For example, if you’re a game designer, placing a full-screen ad once after every few levels is fine. But showing an ad after every level isn’t. Displaying too many ads in a short amount of time can distract users from what they’re doing.
When a user exits your app, his lingering thoughts should be about the service that your app provided him with, not on the dozen or so ads that you just forced him to skip over.
Don’t bribe your users into giving high reviews
Making a freemium app is a lot like building a relationship with someone. Like in a relationship between two people, honesty is very important. As an app developer, you want to be honest to your users. In return, you want your users to be just as honest with you.
Seeing a one-star or two-star review on your app’s download page can be downright depressing. But if anything, don’t be too affected by those reviews. Instead learn from the experience. Find out what aspects of your app are lacking and work toward fixing those issues.
There are plenty of apps in the Play Store and Apple’s App Store that sometimes coerce their users into giving five-star reviews. Meanwhile, some developers will outright delete negative reviews to prevent them from being displayed. While this can sometimes work on kids or older audiences, experienced users will most likely feel offended if they are forced to give positive reviews.
If you want to build an audience around your app, make sure to treat your users justly. Don’t just use them as a catalyst to gather top reviews. Instead, treat them like a secondary beta team. Consider every user as a live tester. For every minute they spend in your app, they are scouring your features for any potential hiccups.
User feedback should be treated with respect. Think about it this way. Behind every feedback you receive is a user interested in helping you improve your app.
And if anything, an app with a distribution of ratings looks more authentic than an app that inexplicably only has perfect reviews.
Never feature-lock your app’s key functions behind a pay wall
In the gaming industry, there’s a phrase called “pay-to-win“. The phrase is usually given to otherwise free games that give an unfair advantage toward paying players. If you’re making a mobile game, this is a term that you absolutely do not want to be associated with.
Giving advantages to paying users sounds like a great idea in theory. It’s easy to think that doing this provides free users with the incentive to shell out some cash, but in reality, a pay-to-win game basically means that a gap exists between players who play for free and players who spend on in-game purchases.
When it comes to developing a freemium app, users should be able to experience your app’s core functionality without spending a single cent. If you’re making a free mobile game, users should be able to enjoy the majority of the game regardless if they spend money or not.
Remember that with a freemium model, there are two ways to generate revenue 
The first is with (hopefully unobtrusive) ads, and the second is by offering premium features.
If you’re planning to offer premium content, make sure that the bonus features are only supplementary in nature. The last thing you want to do is to fool users into thinking that they’re downloading a free app, only to later tell them that the app’s key features can only be unlocked by paying.