How Subscription Model Rules Everything Else?

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Successful businesses begin with a great idea that serves as a solution to a problem or dilemma faced by a consumer. However, a transition to a subscription-based model can steer the business further words success in an evolving marketplace. Tien Tzuo; the CEO of Zuora a software company built to aid organizations shifting to subscription model claims that everything that a user purchases — from transportation to entertainment to groceries — will soon come with a monthly plan.


Since the last decade Promatics has seen the shift quite closely because a subscription model promises cost slashes and higher revenues to businesses. In the article ahead, we discuss why best subscription-based apps are what they are. We discuss the various aspects of the subscription-based activities and how the subscription-based business model is revolutionizing the app world.


Why are Subscription Models a Hit in the Business World?
  • Enterprises benefit from the consistent monthly income that subscription models promise. Regular recurring income can adequately fuel their cash flow and business goals even in between disruptive economic cycles and changing customer interests. With subscription models, the business also gains a better sense of product volume for inventory planning and management.


  • Subscription services are a hit with customers as it helps them save a lot of time and money. Most subscription players focus on offering personalized solutions to their users to make their lives convenient, and modern users appreciate all these perks.


Why is the Subscription-Based Model Perfect for Modern Mobile App Development?

Most mobile app development companies used to make their choice between paid and freemium app monetization models when it came to earning profits from app products. The decision of the Model was based on the nature of the business and the services it offered. However, today we see more and more companies are abandoning the models mentioned above for subscription models for app monetization. Thus, subscription-based mobile apps have gained traction due to high penetration in multiple app categories.


i.) Steady Growth through App Lifecycle

It is important to note that app businesses based on subscription models are enjoying steady growth. The success of this forward-thinking revenue model has got both Apple and Google to rethink its subscription guidelines. Instead of asking users to pay upfront for an app or buying in-app items as the need arises, subscription mobile apps bill customers for a fraction of the amount they would typically shell out. Still, they do so regularly. The real benefit of the subscription model is the auto-renew feature which allows for a steady flow of income from a mobile app. With subscription model businesses can predict future earnings and forecast continued growth. The Model also brings forth the vivid opportunity of increasing the Average Revenue Per User (ARPU) for app businesses.


ii.) User Retention

Generally, subscribers appreciate the subscription-based pricing scheme as it remains the most affordable choice for them. It’s noteworthy that top subscription mobile apps go the extra mile in maintaining good relationships with users. They use engagement plans and retention techniques which shoots the user engagement up during the subscription period. The subscription model allows businesses to pedal new content and bring more value to the user to lure them to stay subscribed over the long haul. Because subscription apps often offer trial periods for their prospects, they get a perfect chance to showcase what the app has to offer and take a shot to get users hooked to it.


iii.) Lucrative Revenue Sharing with App Stores

Apple offers a profitable revenue-sharing model (15/85) to apple subscription-based apps if they retain users for a span that exceeds 12 months. Moreover, subscription apps android to enjoy the 15/85 revenue split but its eligible even on the first year of subscription, making it a more lucrative option for android developers.


Why a Subscription Model is the best Mobile App Monetization Strategy


iv.) Competitive Edge

Intense competition demands a thorough decluttering of the app store. The subscription-based apps are a sustainable option in the app economy. Since subscription-based mobile apps are high-quality products, they offer up to date features and stand a much better chance of outshining the competition.


v.) Effective App Monetization

New subscription policies for app stores have been refined to ease the approach for monetization. Businesses considering mobile app development for ios and android can easily set up a territory-specific price in all app stores. This is crucial for companies trying to sell their apps to regions like the EU that implements strict monetizing regulations. Such new policies also allow enterprises to manipulate pricing to existing and new subscribers. Most subscription-based apps have the flexibility to adjust the price along with the service level. They have the liberty to create different subscription groups with varying levels of service and various pricing schemes.


The Essential Checklist for Businesses Trying to Build a Monthly Subscription App

If you are still wondering about the legality of subscription apps, know that the time is ripe to jump on the subscription bandwagon. Here is the essential checklist for businesses trying to build subscription apps:


a.) It’s essential to determine your goals early if you are a subscription app business. Decide what you want to accomplish through subscription service, is it more revenue you aim at or do you seek faster growth? Making this choice early on helps subscription apps ensure that they build the best pricing strategy possible to achieve their specific goals. These choices further define how the business creates a buyer personas and structure the pricing tiers.


b.) Subscription apps use mobile app development tools to boost customer acquisition with better user experience. Since more customers equate to higher revenue, signing up for your subscription service needs to be made accessible. Working on excellent customer experience will improve your acquisition rate. It’s best to integrate the signing up option in every channel. It’s important to note that subscription business models depend on reliable and lasting customer relationships. Thus the customers need to realize the value the subscription app provides continually. By retaining customers for the long haul, you can build a successful subscription business.


c.) Content indeed drives the conversions. Build an effective content strategy that offers better/more content than what is provided in the free trial. Valuable content keeps your users subscribing consistently. Enterprises also need to time the content releases strategically so that the users feel they are getting new and fresh content always. Focus on the personalization of content. If we look at successful subscription-based apps examples, companies like Blue Apron, Stitch Fix and Loot Crate all channel in the personalization engine to hook users. App users relish the personalized treatment that apps offer and it is what helps create loyalty.


Things to take care of when building a Monthly Subscription App


d.) Exclusivity in curation is another aspect that subscription app developers must focus on. Users must feel that the app experience is curated in a way that a professional has brought things together. Build an app experience to make customers feel that they have access to something they wouldn’t otherwise be able to access. The background should feel off-limits in the absence of the subscription.


e.) Most subscription apps release discount offers to sell. They focus and target the users who are on the last leg of their free trial version. These users are their target segment and are the ones most interested in opting for a subscription to your services. Further, it’s essential to let the users know that the subscription version of your app comes without ads, by running campaigns. Ads can indeed deteriorate an otherwise rich app experience and users see the value of an ad-free experience. You can also announce a reward program for app subscribers who further recommend your apps to others.



Let’s be real. Paid apps find it hard to sustain. Further, because sustaining adverts for profitability is hard for app business, there is a pressing need for sustainable monetization models. App markets need longer engagements of users with the apps in order to be profitable. This is the reason why apps based on subscription business models make regular and recurring revenue. It is time that app businesses move ahead from charging a one-time fee to charging a recurring payment.


There is no question that subscriptions will be a vital force to reckon with in the future of the app business. Our team at Promatics has built numerous subscription-based apps for our clients. We understand how content value matters most for businesses on a quest to build a subscription app. The team at Promatics works creatively and does more than just turning a one-off payment scheme into a recurring fee. We try and deliver repeat value to end-users with the content and app experience, boosting the retention rates when we build subscription apps.


If you are an individual stuck with the question ‘how to build a subscription-based app’? We have all the answers you need. Even if you want to convert your existing app to utilize the subscription monetization model, the Promatics team provides excellent mobile app development services to suit your needs.

Ready to Take the Next Step?


Gagandeep Sethi

Project Manager

With an ability to learn and apply, passion for coding and development, Gagandeep Sethi has made his way from a trainee to Tech Lead at Promatics. He stands at the forefront of the fatest moving technology industry trend: hybrid mobility solutions. He has good understanding of analyzing technical needs of clients and proposing the best solutions. Having demonstrated experience in building hybroid apps using Phonegap and Ionic, his work is well appreciated by his clients. Gagandeep holds master’s degree in Computer Application. When he is not at work, he loves to listen to music and hang out with friends.

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