Join the Nami team at one of the premier indie iOS developer conferences. Learn about how the Nami platform can help you get the most out of Apple App Store subscriptions.

• Sun, Aug 25 - Wed Aug 28
• Grand Hyatt Denver, 1750 Welton Street, Denver, CO, 80202
• Learn more at https://www.360idev.com
  

SAN JOSE, Calif.--(BUSINESS WIRE)--Nami ML revealed the future of mobile app monetization to a packed audience of developers, investors, and industry heavyweights just a few blocks from Apple’s World Wide Developers Conference.

Using their cloud-based platform, Nami demonstrated how publishers can manage their mobile app paywalls, and optimize in-app revenue by utilizing Nami machine learning capabilities.

App publishers have struggled to convince their customers to subscribe in-app because existing do-it-yourself solutions offer little flexibility, contributing to the fact that fewer than 3,000 apps are making any real money on the app stores.

“The Nami Smart Paywall makes it easier than ever to generate mobile app subscription revenue by giving publishers more flexibility and control,” said Dan Burcaw, Co-Founder and CEO. “Plus we’re protecting user privacy using on-device intelligence.”

The patent-pending SaaS offering empowers app publishers to create customer journeys from the first run of an app through purchase. Once a developer installs Nami, marketing teams control the presentation of sales offers that guide the user toward conversion.

Nami automatically learns behaviors that signal a propensity to purchase which improves the user experience by reducing extraneous marketing noise thus increasing customer satisfaction.

“The mobile app industry is struggling to build a healthy paid customer base. We want to give app publishers the tools they need to win,” explained Joe Pezzillo, Co-Founder and Chairman.

This is the second company jointly founded by Burcaw and Pezzillo. Their prior startup, mobile notification provider Push IO, was sold to Oracle, where they helped build and sell the Oracle Marketing Cloud’s B2C mobile product.

Nami has raised a pre-seed round of more than half a million dollars from WndrCo alongside strategic investors with experience at Apple, Oracle, Samsung, WPP and more.

Additionally, Alejandro Cantarero, Ph.D. joins the company as CTO, after years of experience applying machine learning to monetize digital products, most recently as VP of Data at the LA Times.

Mobile app publishers can request an invite at: http://nami.ml

Nami ML is a trademark of Nami ML Inc., all other trademarks are property of their respective owners.

Something New from Dan & Joe

From the founders of Push IO, Dan & Joe have been in stealth working on something new. Be the first to see what we've been working to help app developers make more money. Get an exclusive sneak peek at an event near WWDC by emailing us.

WWDC19 Details

• Monday, June 3, 2019 - Friday, June 7, 20195:00 PM
• San Jose McEnery Convention Center150 West San Carlos Street, San Jose, CA, 95113United States (map)‍

What Are Subscription-Based Apps?

Subscription-based apps are applications that offer content, services, or features to users for a recurring fee, typically on a monthly or yearly basis. These apps can be found in a wide range of categories, including entertainment, fitness, productivity, news, and more. Unlike one-time purchase apps, subscription-based apps generate continuous revenue over time, providing businesses with a more predictable income stream.

By offering a subscription model, apps can provide users with ongoing access to premium content or features while fostering long-term customer relationships. With the growing popularity of services like streaming platforms, fitness tracking apps, and online learning tools, more and more developers are shifting to subscription-based models to capitalize on the trend.

👉Read More: The Power of Cross-Platform Subscriptions: How to Enhance Customer Retention and Boost Revenue

Benefits of Subscription-Based Apps

Consistent Revenue Stream

The most significant advantage of subscription-based apps is the ability to generate a steady, recurring revenue stream. This predictable income allows businesses to better forecast growth, plan for the future, and reinvest in app improvements. For businesses with a well-established user base, subscriptions can provide a reliable foundation for continued expansion.

Increased Customer Lifetime Value (CLV)

With subscription-based models, businesses can achieve a higher customer lifetime value (CLV). Rather than relying on one-time purchases, apps with a subscription model are able to generate revenue from users over an extended period of time. As users continue to subscribe to the service, the value they bring to the business compounds, creating opportunities for upselling, cross-selling, and retaining loyal customers.

Lower Churn Rates

By offering valuable content and features continuously, subscription-based apps can lower churn rates. Subscribers are more likely to stay if they feel they are consistently receiving value. Whether it's through frequent content updates, enhanced features, or tailored experiences, keeping users satisfied increases the likelihood that they will remain subscribed.

Scalability and Flexibility

Subscription-based apps can scale efficiently as user demand grows. With a subscription model, businesses can offer tiered pricing plans that cater to different user needs. From freemium plans with limited features to premium versions that unlock advanced functionalities, businesses can scale their offerings to match the evolving needs of users while driving more revenue.

👉Read More: Cross-Platform App Development: The Key to Building Scalable and Cost-Effective Apps

Popular App Categories for Subscription Models

The subscription model has become particularly effective across various app categories, where users seek continuous access to services or content. Below are some of the most popular categories for subscription-based apps:

Streaming Services

Streaming apps are some of the most well-known subscription-based models. Whether it's video content, music streaming, or podcasts, these apps generate significant revenue by offering users unlimited access to their content for a recurring fee. The success of platforms like Netflix and Spotify demonstrates how subscription-based models can disrupt traditional industries and create large-scale business opportunities.

Fitness and Wellness

Fitness and wellness apps are increasingly popular, offering users access to workout plans, nutrition guides, and wellness tracking tools. Apps like Peloton or Headspace have proven that people are willing to pay for personalized and ongoing fitness experiences. A subscription-based fitness model ensures users are committed to their fitness journey while generating consistent revenue for the app creators.

Educational and Learning Apps

Online education and learning platforms are also thriving under the subscription model. Apps that offer e-learning courses, study guides, or professional development tools can retain users through continuous content updates, certifications, and ongoing support. These apps cater to both individuals and businesses, making them a great source of sustainable income.

News and Magazines

News and magazine apps have increasingly shifted toward subscription-based models as users demand more personalized and ad-free content. By offering exclusive access to premium articles, reports, or special editions, businesses in this category can build a loyal user base willing to pay for timely and relevant content.

Key Strategies for Success in Subscription-Based Apps

Focus on Value-Added Features

To make your subscription-based app successful, ensure that it provides real value to your users. Value-added features like premium content, advanced tools, personalized recommendations, and improved user experiences can justify the recurring cost and make users feel that their subscription is worth the investment. The more value users perceive in the app, the more likely they are to remain subscribed.

Optimize Onboarding and User Experience

The onboarding process is crucial for turning free users into paid subscribers. A seamless, user-friendly experience ensures that users quickly see the benefits of subscribing. Walk users through the app’s features and show them how they can get the most value out of their subscription.

Providing easy navigation and delivering personalized experiences can significantly improve user retention and conversion rates.

Offer Flexible Pricing Plans

Flexible pricing plans allow businesses to cater to different types of users. Offering multiple tiers—such as a free plan, a basic subscription, and a premium plan—enables users to choose the level of access that best fits their needs and budget. A freemium model can also help attract users who may later upgrade to a paid plan once they see the value of your app.

Monetization Models for Subscription-Based Apps

In addition to offering subscription-based models, app developers can enhance monetization by integrating different revenue streams:

In-App Purchases

Incorporating in-app purchases can allow you to generate additional revenue even for free users. Whether it’s unlocking specific content, purchasing virtual goods, or adding extra features, these purchases can complement the subscription offering.

Advertisements

Advertising is another way to generate revenue within your subscription-based app. Offering users the option to remove ads with a premium subscription can help incentivize upgrades while still generating revenue from free users.

👉Read More: How to Set Up and Manage Purchase Approvals on Google Play

The Importance of Customer Retention in Subscription-Based Apps

Customer retention is at the heart of any subscription-based app strategy. The longer users stay subscribed, the more profitable they become. To increase retention, regularly update your app with new content, improve features, and maintain a consistent level of service. Retention can be boosted by personalizing the experience, offering discounts to long-term subscribers, or rewarding loyal users with exclusive perks.

Understanding why users leave your app and addressing these pain points is just as important as attracting new subscribers. With a focus on retention, businesses can maintain a steady, growing user base that generates long-term revenue.

Analytics and Optimization for Subscription-Based Apps

To improve the success of a subscription-based app, businesses should continuously monitor key metrics, such as:

• User Acquisition: Track how many new users are converting to paying subscribers.
• Churn Rate: Monitor the rate at which users cancel their subscriptions.
• Lifetime Value (LTV): Measure how much revenue each user generates over the course of their subscription.
• Engagement Metrics: Analyze how often and in what ways users interact with your app, helping you fine-tune the user experience.

By analyzing these metrics, businesses can optimize their subscription strategies, adjust pricing, and provide personalized content that enhances user loyalty.

Conclusion

Subscription-based apps offer businesses a powerful way to generate consistent revenue while fostering long-term customer relationships. By understanding the value of premium content, offering flexible pricing, and focusing on customer retention, developers can build a successful subscription model that thrives in today’s competitive app marketplace. With the right strategies and tools, your app can achieve sustainable growth and profitability.

FAQs

What is a subscription-based app?

A subscription-based app charges users a recurring fee for access to premium features, content, or services, typically on a monthly or yearly basis.

How can I make my subscription-based app successful?

Focus on offering real value through premium features, ensure an easy onboarding process, and offer flexible pricing plans to cater to different user needs.

What are the most popular types of subscription-based apps?

Popular categories for subscription-based apps include streaming services, fitness apps, educational platforms, and news or magazine apps.

How can I retain customers in a subscription-based app?

Focus on delivering consistent value, regularly updating content, offering personalized experiences, and analyzing user behavior to improve customer engagement and reduce churn.

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What Makes AVOD Unique?

AVOD (Advertising-Based Video on Demand) offers free content to viewers, monetised through the display of advertisements. Unlike SVOD (Subscription Video on Demand), which relies on subscription fees, or TVOD (Transactional Video on Demand), which charges viewers on a pay-per-view basis, AVOD allows users to access a wide range of content at no cost. In exchange, viewers are shown ads before, during, or after the content they are watching.

The key difference with AVOD is its accessibility—users don't need to pay anything upfront, making it an attractive option for a larger and more diverse audience. For advertisers, AVOD presents a valuable opportunity to reach a broad audience by delivering ads to viewers in a more targeted, digital environment.

Key Benefits of Advertising-Based Video on Demand

AVOD offers numerous advantages for both content providers and users:

For Content Providers:

• Scalable Revenue Stream: AVOD allows platforms to generate revenue based on the volume of views and the number of ads served. This makes it easier to scale, especially as the audience grows.
• Large Audience Reach: By removing the paywall, AVOD platforms attract a broader user base. More people are willing to watch content for free with ads, which leads to a wider range of potential advertisers.
• Low Barrier to Entry: AVOD offers users free access to content, lowering the barrier for new viewers to engage with the platform.

For Viewers:

• Free Content: The major appeal of AVOD for users is the ability to watch content without any payment. This opens access to movies, TV shows, and more without the need for subscriptions.
• Variety of Content: AVOD platforms often offer a diverse array of content, including niche genres, older films, and user-generated content that may not be available on premium subscription-based platforms.

👉Read More: What is TVOD (Transactional Video on Demand)? Key Insights and Benefits

AVOD vs. SVOD vs. TVOD: Which Model is Best?

When it comes to VOD (Video on Demand) models, AVOD, SVOD, and TVOD each offer unique benefits. Here’s a quick comparison:

AVOD (Advertising-Based Video on Demand)

• Monetisation: Free content supported by ads
• User Experience: Viewers watch ads in exchange for free access
• Audience: Large, diverse audience with no financial commitment
• Best For: Platforms seeking broad reach and scalability

SVOD (Subscription Video on Demand)

• Monetisation: Paid subscriptions (ad-free)
• User Experience: No ads, uninterrupted viewing
• Audience: Loyal, paying subscribers
• Best For: Platforms offering exclusive content and premium experiences

TVOD (Transactional Video on Demand)

• Monetisation: Pay-per-view model (rent or buy)
• User Experience: Users pay for individual content
• Audience: Viewers willing to pay for specific content (like new releases)
• Best For: Exclusive content, limited-time offers, or rentals

While AVOD is ideal for reaching a large, non-paying audience, SVOD and TVOD are better suited for users seeking premium or on-demand content with more specific revenue models.

How AVOD Works: A Deep Dive into the Process

Understanding the mechanics of AVOD helps content providers and advertisers harness its full potential. Here’s how AVOD typically operates:

1. Free Content Access: Viewers can access content for free, as long as they are willing to watch ads. This makes AVOD platforms highly attractive to viewers who are unwilling or unable to pay for subscriptions.
2. Ad Insertion: Ads are inserted before, during, or after content (pre-roll, mid-roll, post-roll). The frequency and length of ads depend on the platform’s model and viewer engagement.
3. Monetisation: Revenue is generated from advertisers who pay for ad placements. Ad rates can vary based on factors like viewer demographics, ad format, and placement within the content.
4. Targeted Advertising: Using user data and viewing behavior, AVOD platforms can serve highly targeted, relevant ads to different audience segments. This improves ad performance and overall revenue for platforms.

👉Read More: SVOD vs AVOD: Understanding the Key Differences in Video on Demand Models

Best Practices for Implementing AVOD

To successfully implement an AVOD model, content providers should follow best practices to balance user experience and ad revenue generation:

• Optimize Ad Placement: Ads should be strategically placed at natural content breaks, like scene transitions or between episodes, to minimise disruption and maintain viewer engagement.
• Limit Ad Frequency: Too many ads can drive viewers away. Striking a balance between ad frequency and content consumption is key to maintaining user satisfaction.
• Leverage Data for Targeting: Use viewer data to target specific demographics and viewing behaviors, ensuring that ads are relevant and effective for the audience.
• Offer Multiple Ad Formats: Providing a variety of ad formats, such as skippable or interactive ads, can increase engagement and improve the overall viewing experience.

How Advertisers Can Maximise AVOD Potential

For advertisers, AVOD platforms offer a unique opportunity to reach a wide audience with targeted messages. Here’s how they can make the most of AVOD advertising:

• Target Specific Audiences: By using data to understand viewers' preferences and behaviors, advertisers can serve highly relevant ads to specific audience segments, increasing the likelihood of engagement.
• Experiment with Interactive Ads: Interactive ads, where viewers can engage directly with the content (e.g., clicking on links or making purchases), can enhance user interaction and drive conversions.
• Measure and Optimize: Constantly monitor ad performance, including metrics like click-through rate (CTR), view-through rate (VTR), and revenue per thousand impressions (RPM), to fine-tune campaigns and improve ROI.

Tracking Success: How to Measure AVOD Performance

To evaluate the effectiveness of an AVOD strategy, it's essential to track key performance indicators (KPIs):

• Ad Impressions: The total number of ads served to users is a direct measure of ad exposure and potential revenue.
• Click-Through Rate (CTR): Measures how often viewers engage with ads by clicking on them, providing insight into ad relevance and effectiveness.
• Revenue Per Thousand Impressions (RPM): Calculates how much revenue is generated per 1,000 ad impressions, helping to assess the profitability of ad inventory.
• Viewer Retention: Keep track of how many users return to the platform and watch content again. High retention rates indicate that users are satisfied with the ad experience and the content offered.

👉Read More: What is VOD Streaming? A Comprehensive Guide to Video on Demand

Conclusion

AVOD (Advertising-Based Video on Demand) is an effective and scalable monetisation model for streaming platforms. By offering free content to viewers and generating revenue through targeted ads, AVOD provides content creators with a powerful way to reach a large audience. For advertisers, AVOD offers valuable opportunities to engage with consumers through highly targeted, interactive ads.

As the digital streaming landscape continues to evolve, the AVOD model will likely remain a key player in how content is monetised. By adopting best practices and measuring success with key metrics, content providers and advertisers can maximise the potential of AVOD to boost revenue, increase viewer engagement, and expand their audience reach.

FAQs

What is the difference between AVOD and SVOD?

AVOD is ad-supported and free for viewers, while SVOD requires users to pay a subscription fee for ad-free access to content.

Can AVOD generate significant revenue?

Yes, AVOD can generate substantial revenue, especially if the platform has a large user base and effective ad targeting strategies.

How can I optimise my AVOD platform for better performance?

To optimise AVOD, balance ad frequency, target ads effectively, and ensure that the ad experience doesn't disrupt the viewing process. Regularly measure performance metrics to refine your approach.

How can AVOD platforms attract a larger audience?

Offer high-quality content for free, ensure seamless user experience, and provide a mix of relevant ads to keep users engaged. The more attractive the content, the more likely it is to attract a wider audience.

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What is SVOD Advertising?

SVOD advertising refers to the strategic use of advertising within the SVOD model of streaming platforms. In traditional SVOD services, users pay a recurring subscription fee to access ad-free content. However, as the demand for digital content increases and competition intensifies, some SVOD platforms are beginning to integrate limited advertising within their services to generate additional revenue, while still offering a primarily ad-free experience.

Unlike AVOD (Advertising Video on Demand), which is based entirely on ad-supported models, SVOD advertising typically maintains a balance between paid subscriptions and limited, strategically placed ads. This hybrid approach offers an additional revenue stream for content providers without significantly disrupting the viewing experience for subscribers.

How Does SVOD Advertising Work?

SVOD advertising operates differently from traditional AVOD or TVOD models, as it is integrated into subscription platforms that usually offer an ad-free experience. However, to unlock additional revenue, platforms are experimenting with various forms of SVOD advertising. Here's how it typically works:

1. Free Ad Tiers: Some SVOD platforms offer a hybrid model where users who choose a lower-cost, or even free, subscription tier are shown limited ads. This allows users to access content for a reduced fee or no cost, while still enabling the platform to generate advertising revenue.
2. Premium Subscription with Limited Ads: Certain platforms are introducing ad-light experiences where users pay for an ad-free service but still encounter a few ads occasionally, such as in between episodes or during certain types of content, particularly in special events or live programming.
3. Native and Interactive Ads: SVOD platforms can use native advertising, where ads are integrated within the content in a way that feels seamless to the viewer. Interactive ads, where users engage with content by clicking for more information or participating in promotional activities, are also becoming popular.

👉Read More: What is SVOD (Subscription Video on Demand)? A Comprehensive Guide

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Benefits of SVOD Advertising

Incorporating advertising into SVOD platforms brings several significant benefits to content providers and brands:

Additional Revenue Stream

By introducing ads to SVOD platforms, content providers can unlock a new revenue stream while retaining the core benefits of the subscription model. This allows for monetisation of users who may not be willing to pay a full subscription fee but still offer premium content.

Flexibility for Viewers

For platforms that choose to offer a hybrid approach, SVOD advertising allows users the flexibility to pay less for access to content while still maintaining some level of ad-free viewing. This can attract a wider range of customers who may be more price-sensitive but still want access to high-quality content.

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Enhanced Ad Targeting

SVOD advertising provides advanced targeting opportunities for advertisers, allowing them to reach specific segments of the audience based on data such as viewing preferences, demographics, and content consumption behavior. This enables brands to serve more relevant and effective ads, improving both viewer engagement and advertiser ROI.

👉Read More: SVOD vs AVOD: Understanding the Key Differences in Video on Demand Models

Different Approaches to SVOD Advertising

Several approaches to SVOD advertising have emerged as platforms experiment with ways to incorporate ads into subscription services without undermining the value of the user experience:

Ad-Supported Subscription Tiers

Platforms like Hulu have introduced multiple subscription tiers, where users can choose between a lower-cost, ad-supported plan or a higher-priced, ad-free experience. This approach allows platforms to cater to different user preferences while generating ad revenue from the more cost-sensitive viewers.

Limited Ads in Premium Plans

In some SVOD platforms, users still pay for a premium subscription but encounter a limited number of ads in exchange for access to exclusive or high-demand content. These ads are often strategically placed, such as at the beginning of the show or during natural breaks in content, to minimize disruption.

Interactive and Sponsored Content

Interactive advertising and sponsored content are becoming a key part of SVOD advertising. Ads may appear in the form of interactive videos, where users can choose to engage with the content, or sponsored content, where ads are woven into the content in a way that feels natural, often as a seamless part of the viewing experience.

Best Practices for Implementing SVOD Advertising

For content providers looking to integrate SVOD advertising, there are several best practices to follow:

Maintain the User Experience

The key to successful SVOD advertising is ensuring that the user experience is not disrupted by excessive ads. Keep ads to a minimum, place them at natural content breaks, and ensure they do not interfere with the flow of the content. Providing an ad-light experience is essential to maintaining subscriber satisfaction.

Use Data for Targeting

Leverage data to deliver highly targeted, relevant ads to viewers. By using data on user behavior and preferences, platforms can offer ads that resonate with the audience, improving engagement rates and overall campaign performance.

Offer Flexible Plans

Offering flexible subscription plans that cater to different user preferences is a great way to integrate SVOD advertising. Consider providing a choice of ad-supported and ad-free options, as well as offering incentives for users who choose the ad-supported tier.

Ensure Ad Quality

To avoid viewer frustration, ensure that the ads shown on your platform are high quality, relevant, and non-intrusive. The better the ad experience, the more likely users will continue to subscribe to the platform.

Measuring Success in SVOD Advertising

To assess the effectiveness of SVOD advertising, content providers should track several key metrics:

Subscriber Growth

Track the number of new subscribers to see if offering an ad-supported tier or limited ads is attracting more users. A growth in subscribers can indicate that your ad offerings are aligned with viewer expectations.

Engagement Metrics

Monitor how viewers interact with ads, including click-through rates (CTR) and view-through rates (VTR). High engagement rates suggest that your ads are relevant and compelling, leading to better ad performance and higher revenue.

Ad Revenue

Measure the ad revenue generated from your SVOD ads and compare it to the subscription fees to assess the balance between ads and subscription income. This helps you gauge how much additional revenue your ad-based model is generating.

Retention Rates

Track how well your subscribers are sticking with your service over time. A significant drop in retention may indicate that your ad model needs to be adjusted, either by reducing ad frequency or offering more incentives for ad-free subscriptions.

👉Read More: What is AVOD (Advertising-Based Video on Demand)? Everything You Need to Know

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Conclusion

SVOD advertising is a rapidly growing trend that offers an exciting opportunity for content providers to maximise revenue while still offering users the ad-free experience they value. By carefully balancing subscription fees with limited, strategically placed ads, platforms can create a seamless experience for users and generate additional revenue streams.

As the streaming landscape continues to evolve, the SVOD advertising model will likely become an essential component of many streaming services’ strategies. By following best practices, using data for effective targeting, and measuring success through key performance indicators, content providers can ensure that SVOD advertising becomes a win-win for both the viewer and the platform.

FAQs

How is SVOD advertising different from AVOD?

SVOD advertising is typically less intrusive and used in limited forms within subscription-based platforms, while AVOD is entirely ad-supported. SVOD services offer paid, ad-free content with optional ad placements, whereas AVOD relies on ads to provide free content.

Can I offer both SVOD and AVOD on the same platform?

Yes, many platforms use a hybrid model, offering both SVOD and AVOD options. This allows platforms to cater to different user preferences and maximise revenue from both subscriptions and ads.

How can I ensure SVOD advertising doesn’t negatively impact the user experience?

To ensure a positive user experience, keep ads to a minimum, place them at natural breaks in content, and offer users a choice between ad-supported and ad-free options. Prioritise ad relevancy and quality to enhance viewer engagement.

What metrics should I track to measure success in SVOD advertising?

Track key metrics such as subscriber growth, engagement rates (CTR, VTR), ad revenue, and retention rates. These metrics will help you gauge the effectiveness of your SVOD advertising strategy and optimise campaigns for better results.

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