How to make money from mobile apps? That’s a question every company and every entrepreneur has asked themselves at least one.
Mobile application development is growing alongside mobile app revenue. In 2015 the mobile app industry grossed $41.1 billion, 2016 grew to $88 billion, and the 2020 forecast is $189 billion. There are few industries growing as fast as mobile applications. The industries growth drives mobile app development.
There’s one connotation associated with custom mobile application development. It’s expensive. This is driving a new market for mobile apps that businesses can white label.
White labels are a great answer to the question of how to make money from mobile apps. That’s especially true for existing B2B companies servicing customers that could benefit from a mobile application.
What is a White Label Mobile App?
When a company builds a mobile app but allows other companies to rebrand, we refer to that as a white label app.
The developing company creates value by making mobile applications affordable and profitable.
The company that rebrands the app creates value by increasing distribution.
We work with a software company that distributes solutions to radio and television. Their core products focused on increasing customer engagement, and ad revenue.
Some studies suggest that 90% of the time spent on a mobile device is in app. For a business model focused on engagement and ad revenue, this data point was key to future growth.
The company identified an opportunity to create more value for their customers. They knew the increase engagement and revenue by providing a mobile app that their customers could brand and distribute.
However, they knew that creating a custom mobile application for every one of their radio stations was not feasible. First, it would take too much time. Second, it would be cost prohibitive for most of their customers.
They knew their service needed to be profitable, affordable, and feature rich. Every radio station and market is unique, and a branded mobile app needed to have feature options.
They knew that they needed to recoup the cost over many customers, while being flexible enough so that each customer could choose the features important to them.
In addition, they knew one of the most valuable assets for their customers was brand. If a customer were to use a mobile app it would have to look and feel like their brand.
Custom mobile app development may be cost prohibitive for each individual station. But, a branded white label solution would allow them to take an app to market fast and cost efficient.
Examples of White Label Mobile Applications
Mobile Apps in The Fitness Industry
Another White Label Parsed came in the fitness industry. The customer provides software to local, franchised fitness companies (gyms).
The fitness industry is booming. You’ve likely seen it in your own town. Gyms like CrossFit, Orangetheory, Planet Fitness, LAFitness and Anytime pop up on every other block.
Many of these gyms have a local owner and operator. Many of them use a franchise model.
A well run gym will turn a profit. It’s unlikely that profit is enough for them to build the software that runs the gym.
This is a perfect opportunity for a white label mobile application.
First, it’s a fast growth industry. Second, it’s serviced by many small, local businesses.
This white label app allowed the small business owners to focus on what moves their business.
The mobile app managed their non value add activities that aren’t core to their business. Automating activities gave gym owners their time back as they could focus less on scheduling, membership management, and payments, and focus more in health and growth.
Mobile Apps in The Food Industry (and even Food Trucks)
Another fantastic industry ripe for white label mobile applications is the food industry. Food is notorious for being low margin. It’s unlikely that a restaurant, food truck, etc. will be able to invest in their own mobile application.
However, a mobile app can add significant value to their business.
A restaurant can increase customer retention and sales by offering coupons, menu updates, ordering, delivery, location services for food trucks, and specials.
Mobile Apps in the Medical Industry
In your neighborhood, just past the new gym, but before the food truck, there’s a new business that’s popped up – an urgent care center.
Urgent care centers are in fast growth mode as healthcare companies find ways to reduce the cost of care. One tactic is moving patients that need lower cost and routine services from the ER to a local facility.
Some of these facilities are hospital-owned, franchised, while some are local.
Similarly, there are other medical businesses like independent doctors, independent pharmacies, physical therapist, and senior care facilities that rely on their brand, looking for ways to compete/stay relevant against the big providers. Big hospitals, retail pharmacies chains, etc.
Independent pharmacies lose business to the national chains. It’s difficult to keep up with the new services that these big companies can provide.
Each chain has mobile applications for prescription refills, reminders, coupons, schedules, etc.
Requirements for Building a White Label Mobile Application
When building a white label mobile application you have to keep your customers in mind.
Consider what is most important to their business.
In our experience, there are a few things that every white label mobile app needs to provide adequate value to customers.
First, white label development must allow their customers to brand the mobile application. That includes logos and colors. This is important because businesses rely so much on their brand.
Think about some of our examples – radio stations and independent pharmacies. There are dozens of radio stations that a single person can choose, and likely many pharmacy options within a few miles.
If you were to offer an app with your brand that requires an end user to then choose between pharmacy A or pharmacy B, are you really helping them to differentiate their business, and retain customers?
They have options. Yet, if you help pharmacy A to deliver an app to clients with their branding, someone that downloads it is much more likely to use pharmacy A over and over again, rather than switching between pharmacy A and pharmacy B.
While the goal is to minimize the cost to develop and deliver a mobile app, you have to recognize that not every business is the same.
Not every radio station has the same audience demographics. Not every radio station engages with their audience the same way.
If your white label app doesn’t provide flexibility, your customers will be stuck engaging with their audience with the only the tools you’ve built, or wasting screen space with features they’ll never use.
One example of this is engaging your audience with contests. If you’re a station that’s targeting a younger audience, it’s likely you’ll want to run a contest. But, if you’re a religious station targeting an older audience, a mobile contest may be confusing. The wrong features hurt your brand, and hurt engagement.
White label mobile applications have to be affordable for your clients. They also have to allow you to cover the cost of building, and the cost of supporting and developing the service. Money can be saved by using a cross-platform framework that tackles both iPhone / iOS application development and Android within the same solution.
We often act as the mobile expert team for our clients in both mobile app development, and mobile app business strategy.
Pricing/business model is the time in the conversation where we act as a business advisor to help our customers understand the actual costs of supporting and maintaining the app.
We then help our customers to design their pricing strategy with this in mind. The goal is to create a new revenue stream by offering a mobile application for a fixed, low monthly fee.
Flexibility and Profitability
One of the decisions that every mobile app provider has to make is what operating system they should develop their application for – iOS, Android, or Hybrid?
We’ll go into detail on these options in the future, but here’s a quick overview.
Historically, the development skills required to build a mobile app on iOS was different than the skill set required for Android. This meant companies needed two mobile development teams if they wanted an app on these two operating systems.
This is why price estimates can vary so widely when getting quotes from a mobile app developer. There is now a third hybrid option called Reactive Native.
What is React Native?
React Native mobile app development allows a react native developer to write code that works across different mobile operating systems – iOS, Android, and Web Apps.
React Native And White Label
Developing iOS and Android app natively means that you have two teams with different skill sets, two code bases to maintain, and you can essentially 2x your mobile app development cost.
While that might be OK for some businesses, it makes white label mobile app services near impossible.
This makes it easier to manage your service, and more profitable.
Getting Started on White Label Mobile App Services
Like building a house without a blueprint, building a mobile app without a business model, and without a product development plan is a recipe for failure.
White label applications amplify the failure. Building a flexible app that works for many customers is complex enough in itself. A good road map leaves much less room for error.
At Parsed we have extensive experience in white-label mobile application development. That experience allows us to help with more than just app development. We provide unparalleled advice on your business plan and structuring the mobile application offering to optimize profit through those three keys to success – branding, flexibility, and pricing.
How to Make Money From Mobile Apps
Generating a profit from a white label product is not new. Manufacturers and software vendors have a long history of making money with white labels, but applying this to mobile apps is a relatively new industry.
Any company that is servicing other businesses with a homogeneous customer base can benefit from a white label mobile app. The question to ask is would your customers benefit from and offer a mobile app service their customers? If so, what features are needed, what branding is necessary, and what pricing might they endure.
This will help to determine the scale required to turn a profit on a white label, and ultimately how to make money from mobile apps.
The team at Parsed are mobile app nerds, and love to geek out about the business model behind it. If you’re thinking about offering a white label service for your customers and want to explore it in more detail, we’ll be happy to provide guidance on how reasonable certain features might be, develop cost expectations, and the pricing necessary to make it profitable. Submit the form below and we can schedule a free chat at your convenience.
We build mobile applications that are intuitive, beautiful, and that add value to our clients and end users.
We build mobile applications for companies without the resources to do so, and we provide staff augmentation services for companies looking for react native experts.
Are you looking for help building a white label mobile application?
Tell us about your project, and how we can help.