The average monthly revenue of an app on the market for a year is less than $50.
That’s according to the latest research from RevenueCat (RC), a mobile subscription services company. RC’s 2024 report anonymizes the data and uses it to distinguish what works – and what doesn’t – when entrepreneurs try to earn revenue from subscription apps.
Since its founding in 2017, RC has tracked nearly 30,000 apps that use its tools to collectively generate more than $6 billion in revenue. Its customers include Reuters, workspace app Notion and photo-editing app PhotoRoom.
Here are some key findings.
What works
While the average monthly revenue for a subscription app is low, RC pointed out that there is a difference in levels of success depending on the category. Health and fitness apps performed about twice as well as all other categories combined after one year. The top 5% of health and fitness subscription apps had an average monthly revenue of $4,564.82.
Other categories saw lower average earnings, with the second highest number belonging to social/lifestyle apps. The top 5% in that section produced an average monthly income of $2,769.31.
It’s difficult for apps to reach $1,000 in revenue per month, with only 17% of apps reaching this milestone. From that point on, growth appears to get easier, with 59% of apps reaching $1,000 reaching $2,500 per month and 60% of those apps reaching $5,000 per month.
Photo and video apps reached the $1,000 monthly revenue milestone faster than any other category, which RC attributed to the growth of AI image apps last year.
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There’s a wide gap in profits between top-performing and bottom-performing apps, with the top 5% taking home 200 times the revenue of the bottom 25%.
However, RC warned readers that “not all revenue is created equal” and gave the example of apps that generate high revenue numbers, but break even or lose money after taking into account the cost of customer acquisition.
“Revenue doesn’t mean you have a good business; profit means you have a good business,” RC wrote in the report.
What is not working
Travel apps had the lowest return in terms of revenue, with the top 5% making an average of $852.84 per month. However, travel was the best category for converting trial users into weekly or annual subscribers, with a conversion rate of 54.3%, which could mean users had a stronger intent behind their decision to try the app.
According to RC, users will pay for subscription apps if they believe the app solves a real problem they face.
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“Your job is to show the user that you understand the problem and that you have a workable solution, ideally in the first session,” the report reads. “In other words, you want to bring a user to that ‘aha moment’ within 60 seconds of installing your app.”