The majority of apps that require Subscriptions are not profitable

Most of us believe that mobile apps with subscription-based models generate a lot of money. Well, we could be wrong with this thought. According to a recent in-depth analysis, a majority of mobile apps based on subscription models don’t generate money.

The new report named ‘State of Subscription Apps’ was shared by RevenueCat. It is one of the famous mobile subscription toolkit providers. Reportedly, almost 30,000 apps use RevenueCat platform for monetization management. So, we can assume this data to be a true reflection of the market conditions. The recent in-depth analysis is based on data collected from 29,000 apps and 18,000 developers which contribute to a revenue of $6.7 billion and 290 million subscribers.

According to data from RevenueCat, the typical monthly revenue for subscription apps is less than $50 after a year, even though the top-performing 5% of applications generate 200 times more money than those in the lowest quartile. Just 17.2% of apps generate $1,000 or more in revenue each month. Attaining this goal increases the probability of future revenue growth by a large margin; 59% of these apps go on to earn $2,500 per month, and 60% of those apps earn $5,000 or more. Only 3.5% of apps generate $10,000 or more in revenue per month.

As compared to other categories, Health and Fitness apps generate at least twice the revenue in bottom as well as the top 5% quartile. The travel and productivity apps, on the other hand, face difficulties. The best performers in these categories fail to generate $1000 per month even after marking their presence for a year on the market.

Apart from these numbers, the subscription app market is growing continuously. Reportedly, the average price for monthly subscriptions has increased from $7.05 to $8.01 which is a 14% increase. A 14% decline in subscriber retention over a 12-month period was also cited in the report as evidence of a recent change in customer behavior.