Subscription vs. One-Time Purchases: Choosing the Right Model for App Growth

The mobile and web app economy has experienced explosive growth over the last decade, creating ample opportunities for monetization. For startups, indie developers, and enterprise-grade companies alike, one of the biggest decisions impacting long-term growth is choosing between subscription-based pricing or one-time purchase models.

Each approach comes with its own pros, cons, and ideal use cases. In this newsletter, we’ll explore the nuances of each pricing model, when to use them, and how to strategically align them with your growth goals.

Understanding the Models

What is a Subscription Model?

A subscription model involves charging users on a recurring basis—monthly, annually, or even weekly for continued access to your app’s services or features.

Examples:

• Spotify

• Netflix

• Adobe Creative Cloud

• Productivity tools like Notion or Todoist

What is a One-Time Purchase Model?

This involves a single upfront payment for lifetime access to an app or service, with no recurring fees.

Examples:

• Paid mobile games

• Utility apps (e.g., photo editors)

• Productivity apps offering lifetime access

Why This Choice Matters

Choosing the right model can make or break your app’s revenue stream. A mismatch between your monetization model and your audience’s expectations can lead to:

• Low conversion rates

• High churn

• Poor user retention

• Stagnated growth

On the other hand, getting it right means predictable revenue, user loyalty, and the ability to scale efficiently.

The Rise of Subscriptions

Subscription models are booming and for good reason.

• Consumer Behavior Shift: Users are increasingly familiar with subscriptions across media, productivity, fitness, and even food delivery.

• Predictable Revenue: Companies love predictable monthly income for better forecasting.

• Product-Led Growth: With a recurring model, the pressure is on developers to improve features and retain users leading to better overall products.

In fact, Sensor Tower data shows that 97 of the top 100 non-gaming apps use subscriptions.

When One-Time Purchases Still Win

Despite the popularity of subscriptions, one-time payments haven’t disappeared—and for certain products, they might be a better fit.

Ideal for:

• Utility apps that don’t need constant updates

• Games or novelty apps

• Budget-conscious users who avoid recurring charges

• Markets with low digital payment adoption

Bonus Tip: Some developers offer “lifetime access” as a high-ticket one-time option alongside subscriptions, appealing to power users who dislike ongoing fees.

How to Decide: Key Factors to Consider

1. Nature of Your App

Ask yourself:

• Is this app providing ongoing value? (e.g., news, education, productivity)

• Or is it a one-and-done tool? (e.g., a PDF converter or a calculator)

Subscription models work best when value is delivered over time.

2. Target Audience

Understand your users:

• Are they price-sensitive?

• Do they prefer long-term investments or low-commitment options?

For B2B or power users, subscriptions may be more acceptable. For casual users or in emerging markets, one-time pricing may be more digestible.

3. Update Cycle

If your app requires frequent updates or cloud infrastructure (e.g., storage, AI processing), subscriptions can help offset ongoing costs.

If updates are rare or costs are minimal post-launch, a one-time payment can work.

4. Customer Acquisition Costs (CAC)

If your CAC is high, a subscription model helps recoup investment over time rather than relying on a single payment.

It also creates more room for promotions and free trials to attract users without hurting long-term revenue.

5. Retention and Churn Rates

Subscriptions only work if users stick around.

If your retention curve drops fast, a one-time model might be safer unless you can optimize onboarding and improve your product experience.

Hybrid Pricing Models: The Best of Both Worlds

Many successful apps blend both approaches:

• Freemium + Subscription: Core features are free, advanced tools require a recurring payment. (e.g., Evernote, Canva)

• One-Time Payment + In-App Purchases: Users pay once but can buy add-ons later. (e.g., premium filters in photo apps)

• Tiered Subscription Plans: Monthly, annual, and lifetime access plans give flexibility to users.

Pro Tip: Test pricing tiers with A/B testing to understand what resonates with your audience.

Real-World Examples

Headspace (Subscription Success)

Headspace provides daily meditation and wellness content. Their subscription model aligns perfectly with their goal: daily habit formation.

Recurring revenue supports continuous content creation and app improvements.

Procreate (One-Time Purchase Success)

Procreate, a digital drawing app, charges a one-time fee of $12.99. Despite the lack of subscriptions, it has millions of loyal users and remains a top-seller.

Its model works because:

• It’s feature-rich from day one

• It doesn’t rely on content updates or backend services

• Artists prefer paying once and owning their tools

The Financial Perspective

Subscription Model Pros:

• Predictable Monthly Recurring Revenue (MRR)

• Higher LTV

• Easier to attract investors

Subscription Model Cons:

• High churn risk

• Requires constant value delivery

• Users may unsubscribe after trial

One-Time Model Pros:

• Simpler to implement

• Immediate cash flow

• Easier sell in emerging markets

One-Time Model Cons:

• Revenue plateau

• No long-term monetization unless supplemented with upsells

• Harder to justify continuous development

Conclusion: There’s No One-Size-Fits-All

In the end, choosing between subscriptions and one-time purchases isn’t just a pricing decision it’s a business model decision that shapes how you grow, engage, and serve your users.

Take the time to understand your app’s value proposition, user behavior, and competitive landscape. Don’t be afraid to test, iterate, and pivot as needed.

Whether you're building the next fitness tracker, SaaS productivity tool, or educational game, your monetization model will directly influence your user experience and revenue potential.

Ready to Scale Your App with the Right Revenue Model?

At Logix Built Solution, we help founders and product teams make strategic decisions for app monetization, design, and growth. Whether you’re building from scratch or pivoting your pricing model, our team of experts can guide you every step of the way.

Let’s talk about your app’s next big move.