Downloads are not revenue. An app earns when it has a model that fits what it offers and who uses it, and that complies with App Store and Google Play payment rules. Getting those rules wrong can mean rejection at review or an expensive change after the app is built.
This article covers the common monetization models, when the stores require in-app payment and when they forbid it, and how companies think about the return on an app that is not sold at all.
First: does the app need to earn directly?
Many business apps are not designed to sell themselves; they serve an existing business:
- An ordering or shop app: the return comes from the sales and the repeat orders.
- A service or wallet app: such as the Masrof school wallet app, which lets parents top up a balance and follow purchases; its published description lists mada, Visa and Apple Pay for top-ups.
- An internal staff app: the return is measured in operations: less time on data entry, fewer errors, clearer follow-up.
In these cases decide up front how you will measure the return, such as orders placed through the app, repeat purchase or task completion time, rather than waiting for direct "profit".
Common monetization models
| Model | How it works | Suits |
|---|---|---|
| Direct sales | Selling products or services through the app | Shops, restaurants and service providers |
| Subscription | A recurring fee for digital content or features | Content apps and ongoing tools |
| In-app purchases | Buying a digital feature or content inside the app | Content apps and games |
| Freemium | A basic version at no charge, advanced features paid | Tools users try before buying |
| Advertising | Showing ads from an ad network | Apps with very broad use |
| Platform commission | A share of each transaction between seller and buyer | Marketplace and brokerage apps |
Store payment rules: digital versus physical
This is the most important point to settle before design:
Digital content and features
Apple's guidelines (section 3.1.1) state that if you want to unlock features or functionality within your app, such as subscriptions, premium content or a full version, you must use in-app purchase. Google Play's policy requires its billing system for in-app purchases of digital items such as subscriptions and app features.
Physical goods and services outside the app
Apple's guidelines (section 3.1.3(e)) state that an app enabling purchases of physical goods or services consumed outside the app must use purchase methods other than in-app purchase, such as Apple Pay or card entry. Google Play's policy says its billing system must not be used for payments for physical goods or physical services. In practice, a food ordering or maintenance booking app uses your contracted payment gateway.
Store commissions
When you sell through in-app payment, the store takes a commission. According to the official pages at the time of writing:
- Apple: the Small Business Program lowers the commission to 15% on paid apps and in-app purchases for developers whose proceeds did not exceed USD 1 million in the previous year.
- Google Play: in markets where updated fees have not yet rolled out, the fee is 15% on the first USD 1 million of earnings each year for developers enrolled in that tier and 30% above it, and 15% on subscriptions. Google has started applying a different fee structure in some countries.
These rates change, so check Apple's page and Google Play's service fees page when planning, and include payment gateway fees for physical goods in your numbers.
How to choose the right model
- Define what you sell: a physical product, a service outside the app, or digital content? That sets the payment method allowed.
- Ask how often users return: daily use suits a subscription; occasional use suits pay-as-needed.
- Work out the margin after fees: the store commission or gateway fee is part of your price.
- Do not stack models: heavy ads plus a subscription plus purchases drive users away. Choose one main model.
- Measure, then adjust: track trial-to-paid conversion, retention and average revenue per user.
Advertising and privacy
Ads usually mean sharing data with an ad network. That has to appear in your privacy policy and in the Data safety section Google Play requires for every app, and collecting personal data in Saudi Arabia falls under the Personal Data Protection Law. For a company app aimed at its own customers, ads are often a weaker fit than direct sales or a subscription.
What to build in from the start
- The payment gateway or in-app purchase integration, depending on what you sell.
- Subscription management: renewal, cancellation and restoring purchases.
- An admin panel to manage prices and offers without an app update.
- Event tracking to measure conversion and retention.
- Posting sales to your accounting system, such as Odoo, so they appear in reports.
These items affect scope and cost; see our Flutter app cost guide.
FAQ
Can customers pay with mada inside a shop app?
For physical goods and services outside the app, payment methods other than in-app purchase are used, such as a payment gateway that supports local cards, under your contract with it.
Can we sell a digital content subscription through our own gateway?
The general rule in both stores is that digital content in the app is sold through in-app purchase, with exceptions and programmes that vary by country; check the current guidelines before deciding.
Does advertising suit a company app?
It is rarely the best fit for an app serving a company's customers, because it affects both experience and privacy.
Next step
Define what your app sells and how you will measure the return before design. Explore our mobile app development service and the published packages, or book a free 30-minute introductory session to discuss your app's model.