Disclaimer. Our calculations are based on the official data and market averages that significantly vary based on audience characteristics, location, marketing efforts, etc. The calculated number is indicative and is provided for educational purposes and not as a promise or commitment. Taxes are not included into the calculation process.
Assumptions
The income of a personal recipe app on App Store depends on the next set of variables:
- Total available audience: 100,000 users (this is the pool of potential users). This is a variable that can be changed per your conditions.
- Subscription cost: $5 USD per month. This is a variable that can be changed per your conditions.
- Starting point: 0 paying users.
- Conversion rate: 1% of your audience convert to paying users each month.
- Churn rate: 10% of paying users stop paying each month.
- Timeframe: 12 months.
- Apple’s Cut: Apple typically takes a 15% or a 30% commission on in-app subscriptions, depending on the yearly app turnover.
- Influencer Share: Minimum 50% of the operating income.
Calculations
Here is how do we calculate influencer's revenue per paying user / month:
- App income (user/month) = Subscription cost × (100% – Apple's Cut)
- Influencer's Income (user/month) = App income × Influencer Share
If you decide to set the subscription to $10 USD per paying user per month, you will get $10 × 85% × 50% = $4.25
Here is how do we calculate the number of paying users (or subscriptions) in any given month:
- Subscriptions = previous month subscriptions - users stopped paying + new subscriptions
- Users stopped paying = previous month subscriptions × (100% – Churn Rate)
- New subscriptions = Total available audience × Conversion rate
If you have an audience of 100,000 people, and you are able to convert 1% of them into paying users, you will get 1,000 subscriptions for the first month.
The total income for each given month is calculated as:
- Total Influencer's Income / month = Subscriptions × Influencer's Income (user/month)
Given you have an audience of 100,000 people and you set the subscription to $10 USD per paying user per month, you will get:
First month: $4.25 × 1,000 = $4,250
Second month: $4.25 × 1,900 = $8,075
And so on.