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Ask HN: Help me transition my first app from ads to SaaS
I recently released my first app for iOS and Android: budgeting for families [1]. Think YNAB, but without the $60 price tag and no need to spend hours to set things up. The launch was a success in that I am getting continuous user signups. There is a core user base that is active and growing feedback has generally been positive. I think I built something people actually love and now use multiple times every single day. Moreover, it provides a value to my users in the range of $100's per month.
The problem is, I am not making any money from it and cannot see how I will unless I change things up. Initial idea was to add an AdMob banner at the top and give the app away for free. This doesn't work because my CTR is pretty much 0.000% on most days. Some days it goes as high as 0.07% but the CPC hovers around $0.05 so it's peanuts.
I personally don't like ads, in apps I use, or in software I make. It misaligns incentives: my goal is now to make people click on ads instead of using my app. This is the reason I don't want to add interstitials. I used ads in the first place because it let me put off deciding how much to charge.
So, I'd like to transition to a subscription or purchase model. Simplest solution: charge once for an app without ads. Problem with this is that I run the backend service, and once the user signs up I will never get anything else from them. I would price it somewhere between $3-8 but I don't think many users will think it's worth it just to not see a small banner.
Second idea is to restrict usage: you can only track X budgets, or you can only share them with X users before having to subscribe. The problem with this approach is that the vast majority of the current users have 1 budget that they share with nobody or just 1 other person. Not much of a long tail here.
Which would you choose? Also, how would you handle whatever transition you'd choose for the existing users?
Thanks in advance!
[1] http://family-fortune.ridgebit.com/
- benologist 12y agoI agree with your sentiments around advertising, but even more so - the best user experience never asks you to stop and view an advertisement. Maybe you can split this into an offline version that uses pay once, and an online version that they pay monthly. Definitely don't try and sell features you can see nobody cares about.
- IgorPartola 12y agoI never want to stop the user flow and ask them to consider an ad. I like the banner because it's not intrusive and you don't click on it accidentally. The problem with splitting the app into an offline version and a synced version is that there are hundreds of offline versions. The unique value proposition of this app is that it's for families, and is therefore synced. Taking that away makes it like any other app in the App Store/Play Store. Thanks for the idea though.
- benologist 12y agoIf there is demand for individuals you can use this to your advantage and offer a single payment for individuals and subscriptions for families. If you leave it to your competitors to satisfy the individuals then most individuals and one day their families will just stay with your competitors.
- IgorPartola 12y agoThat's a good point, thanks.
- IgorPartola 12y agoForgot to mention two more options I had thought about: 1. Offer a free trial, then ask for a subscription. No ads, and shows you the power of the app before having to pay. 2. Limit the number of purchases you can log per day. Casual users don't pay, more active users need to subscribe.
- qeorge 12y agoHow about: free users can track budgets for 1 person (themselves), and the data is stored locally. If they want to share it with several people for free, they can install it on the family tablet. In the free version you could show ads, and then do an IAP to remove them forever (one time cost). You could skip ads if you wanted, but I would probably go ahead and put them in the free version. You could then offer a companion service which syncs to "the cloud", allows sharing the budget between several people, and which requires a monthly subscription (sold through your website). This segments nicely: young people with no cash get it free, and families who have more money are your paid users. Even better, you have a time-honored and very popular plan to eventually convert your free users to paid. :)
- IgorPartola 12y agoThanks. That's sort of the thing I've been leaning more towards after getting the feedback on here and elsewhere.