Deciding on the Revenue Model for your Mobile App

When deciding between a ‘free’ ad-supported business model and a 'paid' app business model consider these things:

1) Compare the revenue for both the models by doing the following anaylysis

• Crunch the number to estimate the revenue you think you can get per user on a free vs. paid model - estimate the number of impressions you’ll get per day (or week) per user for your ad model v/s how much you plan to sell your app for
  
• Consider the number of users you think you can realistically get with each.
• Ensure you estimate the reasonable growth rate. It will be a while before you can get a million users

2) If you’re leaning towards a free, ad-supported model, make sure it’s scalable for you to support marketing and business development

3) If you want to have a free, ad-supported model but the numbers in 2 above make it unaffordable, consider whether a 'freemium' model would work for you

4) If you feel your app is far better than other apps out there, don't be afraid to charge for it. However, be prepared to invest in marketing and add some major viral elements.