Last Updated on January 21, 2022

As you are here, it’s apparent that either you are new to the app monetization journey or need to know this process better.

When we plan to develop an app, we always target creating something valuable, offering a fantastic user experience, attracting various happy users, and generating revenue, of course.

After dedicating our time and resources, we usually think it’s the app’s turn next to generate revenue for us. Typically, people think about app monetization after developing an app.

We are here with this complete guide, which will help you with almost every query related to app monetization.

App monetization is essential for the success of your app. You may charge your app for subscription services or downloads to generate income. Without a monetization strategy, your mobile app would never be profitable. We have included examples of a few apps making the best use of app monetization strategies and increasing app revenue.

This guide includes everything to ease your app monetization journey. We will let you know why app monetization is essential, its strategies, which you should choose, and much more.

To know more and better, keep reading this guide. We will reveal various revenue-generating strategies also!

What Is App Monetization? – Let’s Dig Deeper to Understand Better

The process of choosing the right strategy for your app to generate revenue is app monetization. You need to follow the right strategy to generate revenue from your app.

For the success of an app monetization strategy, user experience is important as revenue comes from happy users only.

It’s a well-known fact that monetization harms the user experience of an app. You can’t control this, but you can mitigate it. You need to offer a consistent user experience to make your app user stay longer and convert into revenue.

You need to define your app monetization strategy before launching your app. As the choice of strategy depends on the different features of your app, your app needs to hold those features before you kickstart. Additionally, be sure you are equipped with this before because you may struggle to integrate them post-launch.

Why Is App Monetization Important?

Every year, people download 200+ billion mobile apps. Moreover, they spend $140+ billion within those apps on subscription or in-app purchases. When we look at the entire mobile internet time, about 90% of people usually spend on apps.

So, it’s safe to develop a mobile app idea and utilize the user base to build an app revenue. Thus, you need to pick an app monetization strategy to convert your users and save your app revenue besides launching an app.

What do Current Market Stats & Trends Say About App Monetization?

popular mobile app business models

Before moving further, let’s take a walk through the most critical app revenue stats for 2021.

  • There are 5+ million apps worldwide.
  • In 2020, total ad revenue was about $581.9 Billion.
  • With the constant growth expectation of the mobile app market, by 2023, the revenue will reach $935 Billion.
  • In the first quarter of 2021, the Apple App Store generated about $31.8 billion, and Google Play generated $36.7 billion in sales.
  • As per the anticipation, by 2025, consumer’s spending on the App Store will reach about $200 Billion.
  • About 98% of app revenue on Google Play comes from free apps.
  • Approximately 79% of game apps and 50% of non-game apps use the most common app monetization strategy, in-app purchases.
  • All over the world, users are spending about $380 Billion on in-app purchases.

Types Of Mobile App Monetization

The app monetization model divides into two categories:

Direct Monetization

As the term says, in this category, the revenue comes directly from the app.

Let’s take an example; suppose you offer a premium app at $10 on the App Store or Play Store. If anyone purchases your app, the money will come directly from the app. Even if an app user buys anything from within your app, the revenue will come directly from the app only.

Indirect Monetization

In this category of app monetization, your app revenue doesn’t come directly from your app.

Let’s take an example; suppose you place Google Ads in your app, your app will not generate any revenue, Google will pay you.

App Monetization Strategies – Generate Revenue from Your App

Holding a wide customer base, app owners can choose app monetization strategies to make money from their apps.

While finalizing an app monetization strategy, you need to take extra care of the UX/UI of your app. A bad UX may lead to various severe consequences on your app revenue.

Let’s check out top app monetization strategies that you may choose to generate revenue from your app.

Protecting the user experience at all costs will keep users coming back. They’ll continue to use your app, leave positive reviews, and even recommend it to their friends. Just wait and watch how your app begins to generate more revenue than before. – Dennis Bell, Founder, and CEO, Byblos Coffee

A. Freemium

Freemium app monetization model
Spotify offers both Free & Premium plans for a different set of features under the Freemium model

In 2021, freemium apps report about 94% of the market share and are emerging as a leading Android app monetization strategy. It would be an effective strategy for growing a user base. It combines the free and premium features into one app. App’s free version permits the users to use the basic features.

Unsurprisingly, free apps witness higher download rates as the users get a chance to try your app before paying for anything within the app.

In contrast, the premium one offers users access to premium features and content after they make purchases. You need to maintain the right balance between providing too few and too many free features. Suppose, if your free version is better, just think why users would upgrade their app. Also, imagine if it’s not impressive at the trial, it would be tough to convince the user that the app is good to go.

When to Use: You hold a large and active user base, can cater to an engaging user experience to both paid and free users.
Pros: It offers multiple revenue streams for mobile apps.
Cons: It demands considerable time to become profitable.

Example: Spotify – A Music Streaming App

It’s ruling the market with a fantastic monetization strategy. Its average conversion rates lie between 2-5%. But, Spotify holds the caliber to convert its 42% of freemium users into its paying subscribers.

Also Read: How do free apps make money?

B. Premium

Now, you may have a question, do you need to charge the users for your app? Check these two compelling reasons to decide if this strategy would be best for your app:

  • Upfront revenue earned with each download, &
  • Faster profits

With the premium approach, interested people would need to pay for the app even to try it.

This strategy is on a downfall as people are not likely to spend until they trust. But you won’t believe, paid apps generally witness higher user engagement and loyalty as people mostly prefer using what they purchase.

Before choosing this app monetization strategy, you should check out your competitors and ask yourself if your app is better than free alternatives? Why would your audience pick your app over a free one?

The best way to achieve success with this strategy is to increase your app value. It means a compelling description, five-star ratings, complete feature sets, and rich UI will make you win.

When to Use: You are confident that your app is better than other free alternatives and holds top ratings.
Pros: Revenue depends directly on downloads.
Cons: Customer Lifetime Value (CLV) on average is lower than other app monetization strategies.

Example: Bouncer – Temporary App Permissions

It makes you capable of granting permissions temporarily. Right now, it’s running successfully with a 4.5 rating and 2k users.

C. In-App Purchases

in app purchase monetization model
Clash of Clans is a gaming app that offers in-app purchases for getting a boost & get additional gaming features

According to a few studies, users are spending about $380 Billion on in-app purchases worldwide. This strategy permits users to buy services, content, and special features within an app. While keeping the app free to download, you can use this highly quantifiable and tested revenue metric to generate your app revenue. Users buy within the app and improve their in-app engagement.

While considering this app monetization strategy, be sure that it complements your user experience. And, make sure you let your users know on the App Store page that although your app is free, it does involve in-app purchases.

Additionally, to make your app users purchase within your app, you can send personalized notifications that match their activity or browsing history, thank them for their purchase, inform them about time-sensitive discounts, etc.

And yes, using push notifications, you can increase your in-app purchases by about 16%.

When to Use: It delivers real value to buyers and helps in improving the user experience.
Pros: It permits users to try an app before buying it, leading to a broader user base. Also, it can prove to be highly profitable.
Cons: App with in-app purchases need to pay an amount that the App Stores charges as a commission (currently 30%).

Example: VSCO – Photo & Video Editor

You can download this app for free. It changes the amount for the purchase of photo presets. The cost starts from $0.99.

Hire mobile app developers

Types of App Purchases

To make efficient use of in-app purchases, you need to customize this strategy. So, let’s check out its different categories:

Consumable

In mobile games, you will notice various in-app purchases, like bonus health, in-game currency, or power-ups.

After the player buys and uses his purchases, consumable items disappear. The user can repurchase them anytime.

This type is best for players who hate waiting.

An example of consumable monetization is Clash of Clans (COC) which has around 500 million app downloads on iOS & Android. This app lets the user buy Gold, Elixir, and Dark Elixir for a certain amount of money. Once the resource purchased is consumed, the user has to purchase it again. So, this monetization model is working pretty well for this gaming app.

Non-Consumable

This type of in-app purchase lets the purchased non-consumable items stay forever in the app. These items are also known as unlockable items. This type of in-app purchase is crafted to allow players to unlock the complete functionality of the game.

Examples of non-consumable items are bonus games, loot boxes, cosmetic items, etc.

Heart Boxes, a puzzle game, uses the unlock new level strategy to encourage app users to pay. It’s a non-consumable purchase. After purchasing such items, users can open a level and access it until they have the app. It lacks an expiration date on that specific level.

Auto‑Renewable Subscriptions

In this type of subscription, users need to pay an amount to access some premium content. Moreover, it lasts for a certain period and also renews automatically. If users want to cancel the renewal, they can do it.

Example: The subscription to magazines, the iCloud storage service, etc.

Non‑Renewing Subscriptions

Like renewing a subscription, this type of subscription also demands an amount to unlock premium content. Moreover, it also lasts for a certain amount of time and even allows renewal. But, the one difference is, it doesn’t get renewed automatically; the user needs to do that manually.

Example: Such in-app subscriptions include digital content, week-long subscriptions to magazines, etc.

Virtual Currency

By giving the users access to virtual currency, app developers have started using new revenue streams. The users buy this currency with real cash and use it for various purposes within the app.

Typically, the users use this currency to move ahead in the game or just redeem certain services and features that would take quite a long to unlock.

Physical Product or Service

In the exchange for your physical product or service, the users are allowed to pay quickly using the in-built payment structure. If you want to increase your revenue, be sure that your physical good or service is of the best quality.

Commission Based

Through your app, Google and Apple both take 30% of every in-app purchase. But, if you are big enough, you can negotiate individual commission fees with the app stores. But, most apps can’t achieve this as they need to stick to the rules.

Transaction Fees

The apps holding a marketplace or include a significant type of audience transactions, for those this would be a perfect way to monetize app users.

User Marketplace

The idea behind this is you charge a percentage of a transaction between two users. In this, the seller is not required to pay any listing fee. This makes users use your service.

Transactional Apps

New types of apps that use transaction fees to monetize are invoicing apps or financial apps. Such apps help conversion of currency or option to trade in shares. Whenever users make a transaction, the app makes revenue.

D. In-App Advertising

in App Ads in pics art
Pics art app running ads in the footer section to generate revenue: a part of in-app advertising strategy

Monetize the app with ads or without ads; which one is better?

With no obstruction of pay up-front, the apps that choose an in-app advertising strategy seek to attract a broader user base and accumulate enough information to place targeted ads.

In-app ads perform 11 times better than general banner ads, with 152% of increased click-through rates. That’s why it is the fastest-growing advertising strategy.

While using in-app ads, the app developers need to exhibit the right offers to the right audience; they can add value to the users and the advertisers.

When to Use: You can accumulate behavioral user data and rich demographics. Also, your app’s nature points to lots of users, longer sessions, and frequent visits.
Pros: It allows free downloads and leads to a broader user base.
Cons: It can obstruct the user experience if they don’t fit into the app.

Ad Formats

App Ad Formats

In app-advertising comes with various types of ad formats. So, you can pick any format, merge them according to your preference. It’s the best way to generate revenue and build a robust user experience.

Interstitial Ads

Rich interactive ads for users, the interstitial ads suit the best for apps with linear user experiences. These are full-screen ads and cover the complete interface of their host app. These ads are placed between content and hold the caliber to produce the best click-through rates.

It can be in the form of a video or display, and during its run-time, it asks the users to just look at the screen. An apt time for displaying interstitial ads is at the end of a user flow.

Such types of ads are best as they demand user engagement for a short time. After a few seconds, the user can close the ad and move on or just click through to learn more about it.

Example: Cookie Jam, Smule, etc., allow in-app purchases.

Video Ads

One of the most effective ad formats is video ads. Facebook, Google, etc., are the leaders in this corner. A mobile video ad is usually short, about 15 seconds in length. It introduces an app and offers a direct link to download it.

Mobile Rich Media Ads

Such ads appear in mobile banner ad format that embraces a set of HTML, JS, CSS, and image files. This type of ad allows the advertiser to implement creative ideas.

These ads lead to high engagement, high conversion, and high interactivity.

Instream Video Ads
Instream Video Ads

These ads deliver the complete functionality required to increase revenue with improved click-through rates and higher eCPMs.

There are three types of in-stream video ads: Pre-roll, mid-roll, and post-roll.

Pre-Roll Ad: An ad that starts playing before a video playback starts. The term “pre” says exactly the same.
Mid-Roll Ad: Mid-roll ads interrupt the video playback to play. First, the ongoing video pauses, the mid-roll ad starts playing, and the video playback resumes after it completes or is skipped.
Post-Roll Ad: The ads play after a video playback completes and before the next video playback starts.

Native Ads

These ads include video and textual ads that copy the editorial content available on the website. The user doesn’t perceive such ads as direct advertising, and this increases user loyalty.

These ads are cost-effective, non-intrusive, and align with design.

Example: Instagram Ads, Twitter Ads, or Facebook Ads.

Rewarded Video Ads
Rewarded Video Ads

These ads offer rewards to users who watch the ad for getting bonuses in a game, hints, different life, or valuable content. This video lasts for 15-30 seconds and comes with a skip or watch options.

The rewarded video ad should be shown when there is something big in return. For example, on most of my games, when a user loses all the lives,I show a button to get an extra life and continue the game. The conversion rates for that button are always high. – Madhsudhan Khemchandani, Owner, MK’s Guide

Such ads are highly interactive, engaging and lead to a high completion rate.

Example: Spotify

In a mobile game, an app player can watch a skippable video to earn some in-app currency.

Outstream Video

By using such ads, marketers and publishers guarantee viewability and increase content engagement. Such ads integrate seamlessly with mobile web content, in-app content, or desktop content instantly.

Such ads guarantee viewability and increase engagement.

Classic Banner Ads

The banner ads are the static ad units that we see at the top or bottom of the screen, like standard banners. This type of advertisement usually includes full-screen banners that cover the entire screen of mobile.

Such ads are cost-effective, easy to launch, affordable, and universally supported.

Playable Ads
playable ads
A game appears in ads that can be played for a brief time like 30secs

It is an interactive game’s test version demo shown to the users as an ad unit. These ads generally last for about 15 seconds to a minute. These ads are effective for the promotion of mobile games.

Playable ads are highly engaging, interactive and lead to higher conversions.

Example: The micro-games that offer tiny snippets of the games to allow users to give them a try.

E. Subscriptions

Subscription based monetization

A report says that about 52% of app developers who chose a subscription app monetization strategy agree that it had a positive, influential impact on their business, increasing their user base and revenue.

The app developers craft a 3-tier subscription policy targeting the basic, intermediate, or advanced spending capability. Such an app monetization strategy allows first-time users to download the app for free, but other unique services are available to users who subscribe to them.

While choosing a subscription strategy, you need to convert your users into subscribers and keep your existing subscribers from churning. You need to reveal the benefits of app upgradation to new, free users and constantly offer existing subscribers new content and features to hold them for long.

When to Use: You have the content app, like media, news, and entertainment apps frequently used.
Pros: It can pull many free users and hold them on the app before converting them to paid ones.
Cons: It’s tough to determine how much content should be offered for free before attracting the users for a subscription.

Example: Netflix – Watch TV Shows, Movies Online

It is a subscription-based app that generates $25 billion per year with its subscription-based service. In this app monetization strategy, users can pay a low monthly fee to access their app on a single screen. The plan’s cost increases with the number of screens.

F. Sponsorships and Partnerships

Nike & headspace Partnership

Sponsorship demands collaboration with advertisers who offer rewards to your users after they complete their specific in-app actions.

Your user base is broader enough to attract the brands to pay for extensive exposure to your target audience as per the sponsorship strategy.

On the contrary, with partnerships, you collaborate with the other app whose user base matches yours. It’s a mutually beneficial link that assists you in enhancing your offerings and attracting more users.

When to Use: You hold a broader user base and have recognized a partnership to deliver unique value to your users.
Pros: It is an effective way to expand or improve your services to the users and big markets.
Cons: If your identified partnership is not a good match or executed perfectly, it may frustrate existing users.

Example: Nike & Headspace

With the partnership of Nike and Headspace, users can improve their focus, athletic performance, motivation, recovery, besides enjoying their workouts.

With the training and instructions from elite athletes of Nike on speed and endurance, the new run embraces advice from experts of Headspace regarding enhancing the running experience and better way of workouts.

G. Affiliate Marketing and Lead Generation

Affiliate Marketing based app
The Honey app works by providing deals & coupons to users and earns via affiliate marketing

The best way to promote other businesses’ products and earn a commission in return is affiliate marketing. You can find a product of your interest, advertise it to others, and gain a profit for every sale. With this app monetization strategy, you can earn money whenever a user downloads or buys a product or service following a link you host on your website or app.

Example: Podcast Addict

This app uses this app monetization strategy by hosting in-app ads at the bottom of its screen.

On the contrary, lead generation includes catching the attention of potential users to advertise them. This strategy helps you in earning a commission by selling leads to other interested parties.

Example: Mint.com

It offers free personal finance management services to its users. It permits them to track their investment, credit card, loan balance, bank transaction, offer financial goals, and produce the budgets. Post that, it accumulates entire financial data and sells it to banks, credit card companies, and other interested parties at a reasonable cost. Moreover, it generates revenue using affiliate programs that allow users to sign-up for credit cards through the app.

While choosing this strategy, you need to know that it involves ethical or legal outcomes to confirm that there’s no violation of any moral or legal principles that may affect your business’s reputation.

H. Data Monetization

whatsapp privacy statement

It is the process of using data and increasing revenue. The fastest-growing and top-performing companies are adopting data monetization.

Data monetization is categorized into two:

Direct Data Monetization

It includes selling direct data access to third parties. One can sell it in raw form or perfectly transformed form, insights, and analysis.

Data monetization can drive revenue to any app category. After the one-time SDK integration, there’s no further commitment, so it’s scalable. – Jus Chall, Brand Strategist, Skein

Indirect Data Monetization

Here, things get interesting. First, one conducts data-based optimization, which includes data analysis to insights. Such insights help in improving business performance. Data holds the caliber to identify how to reach consumers and understand their behavior to increase sales. Also, data highlights how and where one can save costs, avoid risk and lead to flawless operations.

Minor Differences between Android App Monetization & iOS App Monetization

AndroidiOS
Ad SDK ( Advertisement Software Development Kits)Use 2.9 Ad SDKs to connect an app with an ad network.Use 1.9 Ad SDKs.
Ad-based monetization in non-gaming appsAbout 63% of Android non-gaming apps use ads.About 25% of iOS non-gaming apps use ads.
Gaming App MonetizationImplementation of Paid App Monetization Strategy: 7% of Android game appsImplementation of Paid App Monetization Strategy: 11% of iOS game apps
In-app Purchases Approach: 22% of appsIn-app Purchases Approach: 17% of iOS apps
Profit ShareLessApple rules the profit share.
Loyalty RatesHigherLower (comparatively)

Note: When you target display advertising or measure the success of advertising, you need to check out the Advertising and the Data Use and Sharing sections of the App Store Review Guidelines.

Additionally, if you want, you can offer your users access to services or content across multiple devices and other platforms. Further, if you provide any multiplatform functionality to your app users, be sure that the purchasable services or items available outside the app should also be available as in-app purchases. You can check out the Multiplatform Services section of the App Store Review Guidelines.

Which Monetization Strategy Is Right For Your App?

You need to follow best practices for deciding which app monetization strategy will work best with your app.

Research other apps: You need to research other apps in your category well and know how other developers charge for their content and apps. Also, consider if offering alternative ways to pay would be beneficial.

Consider your price structures: If you hold recurring content costs, choose a subscription strategy. Also, offer a free trial to encourage purchases.

Think about usage patterns of your app: It will indicate the choices of monetization.

In-app purchases and advertising would be apt for casually used apps. You may consider offering an in-app purchase that helps to remove ads.

Use natural extensions: If your app can be expanded, like adding levels in a game app. You can consider making its basic version available for free and later provide extended features through subscriptions or in-app purchases.

While setting costs, consider local factors: Setting prices for apps, subscriptions, or in-app purchases, remember to consider local pricing patterns, differences in cost of living, cost of competitive apps, and other factors.

Consider your target audience: For some users, the target of choosing a subscription, advertising, or in-app purchase can be limited. In such cases, paid (premium) apps are more apt.

How To Improve Mobile App Monetization – Best Practices

Let’s check out the best practices to optimize your monetization strategy.

Analyze Statistics

By tracking the app metrics and analyzing your users’ stats, you need to understand their purchasing patterns, new vs. returning buyers, and average revenue per user.

Run Pricing Tests

You can use in-app A/B testing to experiment with different prices and alternative ways to make users purchase in-app or take up subscriptions.

Offer A Sale Price

You can use strikethrough pricing in paid apps to offer a discount for a limited period and encourage increased purchases.

Don’t Miss Out On Data Monetization

As you already know, missing data monetization may allow app revenue to slip off your hands. Data monetization assists in increasing app revenue without affecting the user experience.

Track User Engagement

You should keep your users engaged in learning about your app’s growth rate. The user engagement represents user satisfaction, helps in effective monetization, and ensures consistent growth. So, to maintain the app’s growth graph, it’s essential to keep your users engaged and interested to an extent.

Test Methods Before Use

Every app is unique. It’s not like something that worked best for another app will perform similarly for your app also. Here are the mobile app testing types which can help you during app development.

You need to test the methods before implementing them.

Build A Community

Communities are essential, especially for mobile game apps. So, by making your users a part of a like-people community, you can make them more engaged. The players compete and motivate each other to keep going.

People use the community to track what others are doing, find solutions to their issues, monitor which players purchased to accomplish a level.

The consistent engagement of players in the game would assist in optimizing mobile game monetization. Their more extended session will allow you to learn how they interact with the game, what they expect from it, and how they can make it better. Moreover, they can personalize their in-app experiences and purchase journeys.

Create A Dynamic Pricing Model

Every user is different, be it their way of interaction with the app or the number of resources. Here the dynamic pricing enters.

You need to analyze and understand user behavior, how they interact, where they leave, and their previous purchase. After that, build a dynamic pricing model matching their users. This way, you can convert them efficiently.

Hybrid App Monetization

You can choose more than one monetization strategy as it’s usually recommended. But, you need to be sure that it’s not affecting your user experience.

Offer Discounts To Loyal Users

Your app users, especially those not comfortable buying your in-app offerings, can convert into revenue if you offer them special discounts. This tactic may help you grow your user base if planned strategically.

Stay Updated

Go through the latest blogs and resources to keep yourself updated with the changes in the app monetization strategies.

Include A Subscription Model

You can implement a subscription strategy in your app, and such a strategy targets offering access to in-app content. Users will download the app for free and access its basic features for a limited time. After that, you may prompt them to purchase or subscribe to a paid plan. This way, you can first show them value and then convert them into revenue.

Challenges Faced During App Monetization

App monetization is not an easy job. You need to keep an eye on your user behavior. Various challenges would interfere while running on the pathway towards successful app monetization. Let’s check out the challenges and solutions to overcome them.

Issue 1: Poorly Integrated Apps

If you awkwardly position your ads, it may affect your CTR. Resultantly, it will lead to low customer retention and low payouts.

Solution:
Keep users in mind while choosing an app monetization strategy. Follow the steps that may ensure a positive ad experience.

Issue 2: User Acquisition Is Expensive

Publishers need to understand the usability of their products. If not, the cost of acquisition may affect their budget. Resultantly, it may risk their app’s profitability.

Solution:
Publishers can invest in UX research to increase their app’s retention rate and lower acquisition costs. It shows UX research increases revenue.

Issue 3: Mistakes That May Happen While Formulating Premium Memberships

While working on crafting premium memberships, publishers usually choose to remove ads as their chief premium benefit. Ads are ethical; that’s not the point, but what they are trying to do is targeting the users’ discomfort. Is this what they are trying to offer to their app users?

Solution:
Be sure your premium plans appear to be more than an ad-free experience to them. Try making it simple.

Chief App Monetization Metrics To Measure Your App Success

Brands track various performance indicators to measure an app’s success. Here, we will know some app monetization metrics to measure your app’s performance.

Average revenue per user (ARPU): Average amount of money generated/person * Total customer base.

Customer Lifetime Value (CLC): It measures the net profit generated by each customer.

Customer acquisition cost (CAC): It is the cost of acquiring a consumer, including advertising, labor, and other charges.

Cost per Mille: It’s the cost an advertiser pays for one thousand impressions or views of an advertisement.

Cost per Action: A pricing model where marketers pay media sources or ad networks for specific conversions within an app after an ad engagement.

Cost per Click: In this model, you need to pay whenever someone clicks on your ad.

Cost per Install: The rate that marketers pay to acquire new users just by app installation.

Cost per View: A cost an advertiser pays whenever their video ad is played.

App Monetization Models

Let’s check out the top business models for mobile ads.

effective Cost Per Mile (eCPM) model: It measures the cost of every 1000th ad impression, whatever be the purchasing method.

eCPM = Total Earnings/Total Impressions X 1,000

Cost Per Click (CPC) model: This model helps bill advertisers based on the number of visitors clicking on an ad attached to their websites.

CPC = (Total Ad Spend/Total Measured Clicks)

Cost Per Action (CPA) model: Publishers are paid only when mobile users take action after viewing an ad, clicking on it, subscribing to an app, making an in-app purchase, and more.

Top Mobile Ad Networks For Monetization in 2021

An app network is the best place for publishers and advertisers to buy and sell mobile display ad inventory.

Google Ads

google ads

It offers advanced advertising approaches to allow the user to do more with their campaigns. Moreover, it helps with the best ways to use intelligent tools, marketing automation, insights, and more.

Google Ads allows you to run CPI, CPC, and CPM campaigns. Additionally, it supports video ads, interstitial ads, and Native ads.

With Google Ads, you can target your users based on their location, operating system, mobile platform, connection type, interests, and device.

Google Ads is available on Android, iOS, Unity, and Cocos.

Facebook Ads

facebook ads

Another giant, Facebook, helps with various targeting options, like device, OS, OS version, age, gender, location, language, and users’ interests.

Facebook provides banners, video ads, slideshow formats, and carousel banners. You can run ads through the Facebook app, Instagram, Messenger, and Audience Network.

With Facebook, you can target mobile users on iOS, Android, and web platforms, and marketers can run CPM and CPI campaigns.

AppLovin

applovin ads

It prioritizes the users’ quality in their network. It helps you connect with users who engage for months, not minutes.

With Applovin, you can use an interface to view performance and get the best ways to optimize it. Moreover, it offers the latest monetization solutions to increase your app revenue.

Applovin supports CPA campaigns, CPC campaigns and provides custom targeting along with re-targeting options. Also, it supports custom ad formats.

Applovin supports iOS, Android, and mobile web platforms.

UnityAds

unity ads

Unity Ads assists advertisers and publishers in reaching their business targets. Publishers prefer using this ad network to generate revenue from their mobile games. On the contrary, advertisers use Unity Ads to increase their user base.

This ad network supports CPM and CPI on Android and iOS platforms.

If you want to use video ads to monetize your gaming app, you can use unity ads.

AdColony

adcolony ads

An ad network that specializes in mobile video advertisements is AdColony. It offers rich media and HD video formats, which is why publishers and advertisers widely accept it.

It supports Android and iOS platforms and uses the CPM business model.

Apple Search Ads

search ads

It assists people in discovering your app when they search on the App Store. This platform delivers industry-leading value and performance for advertisers while ensuring the best customer experience.

Apple Search Ads help you target various iOS versions, genders, devices, ages, and locations. It supports CPI campaigns.

YouAppi

you appi

It helps brands increase their mobile user acquisition and retention approaches. The whole network is based on machine learning that offers advertisers custom targeting options.

YouAppi supports CPA and CPI campaigns. Additionally, it supports Native ads and Video ads on Android and iOS.

Summary of App Monetization

  • Focus on user experience
  • Remember that users prefer apps with free downloads.
  • As the popular app stores provide reduced commission rates, subscription models are catching up the success.
  • The best way to generate app revenue without harming user experience is data monetization.
  • Plan thoroughly before starting your app monetization journey.
  • First, understand your audience, and next, hit the right. You can try hybrid app monetization strategies to meet the different users’ expectations.
  • Stay updated, keep learning, and generate app revenue effectively.

Our Thoughts – The Conclusion

While deciding the best app monetization strategy for your app, you should consider your offerings, audience, and capabilities.

You may find some app monetization strategies easy to implement. Still, before that, you should also be aware of other requirements while planning app monetization at the initial stage of app development.

Also, you should consider your skills. If you find yourself a world-class marketer, then choosing an in-app strategy would be a smart move. On the contrary, sponsors and partnerships will work wonders for you if you are a PR whiz.

Additionally, remember to keep an eye on your competitors also. Perform deep competitor research and accumulate data on how alike audiences are using similar apps.

Holding all these in place, you will be all set to pick an app monetization strategy that may bring constant ROI to your business.

Frequently Asked Questions Regarding App Monetization Strategies

How do I monetize my mobile app?

You can choose from many app monetization strategies like data monetization, in-app purchases, advertising, etc., and implement it with your app to make money from it.

How much revenue can an app generate?

This question is quite tricky. The app revenue depends on the number of your daily active users. Additionally, it depends on the type of monetization strategy you choose. When we talk about the publishers, they can earn approx thousands of dollars in some cases per month.

How can I monetize my app with ads?

You can go for affiliate ads that allow your application to generate commission from other apps just by advertising them in your app. Furthermore, you can also exhibit native ads by using shopping or search ads engines.

How can I monetize apps without ads?

You can provide a paid version of your app or premium features. App referral programs and subscriptions also facilitate you to generate money without apps.

Does Google AdMob really pay? Is it paid?

No, AdMob is free. Additionally, if you use Google and any 3rd-party ad networks, they will pay you for impressions, clicks, and other interactions with the ads that you display in your app.

Have you successfully monetized apps with ads?

Yes, we have monetized various apps with ads successfully. Besides implementing different types of advertisements, we have also picked the best app monetization strategies suiting our mobile apps and the users.

Do I need to implement multiple app monetization strategies for earning a good sum?

Most of the apps are free at the time of installation. So, there should be something that may help in generating app revenue. That’s why you should implement an app monetization model to make money from your app post download.

Do these app monetization strategies fare well on Google play store as well as Apple Store?

Usually, people don’t prefer spending the same amount on Google Play Store and the App Store for app monetization.

As data depicts, iOS users are more likely to spend money on mobile apps than Android users. That’s why people usually choose an app monetization strategy to implement with their iOS apps.

Apple products are already considered to be premium. Moreover, iOS users have a lower tolerance to ads and more to paid content than Android users.

Thus, we can say publishers usually prefer the iOS app monetization strategy as here iOS users are more likely to pay for a subscription or make an up-front purchase.

How much money can you make from an app? Is there a way to calculate estimated revenue?

If we talk about average, apps usually generate $82,500 daily. Gaming apps develop about $22,250, and entertainment apps make $3,090 daily.

You can calculate your app revenue using the below formula:
eCPM = Total Earnings / Total Impressions x 1,000

How much time will it take for app monetization to take effect? How soon can the app start generating revenue?

If we talk about YouTube, it takes about 30 days to review an app. Although, a backlog is developed regularly. So, on average, an app takes 30 days to start generating revenue.

It varies, but a general answer to the question, when an app starts generating revenue, is 2-3 years. It’s a standard estimate for the time an app takes to become profitable.

How much time will it take your app developers to implement these strategies?

It depends on the strategy they implement in their app, like an in-app advertisement, etc.

Author

I am an eCommerce consultant, a member of the Forbes technology council with a decade of experience in the ecommerce development segment. My expertise can make your business overcome any obstacles while you are dealing with the Magento ecommerce platform!