Choosing The Right Mobile App Monetization Strategy

Choosing The Right Mobile App Monetization Strategy


In an ideal world, you might construct an app, launch that app, and the cash will observe.

It’s a beautiful sentiment, however the course of is extra difficult than that. There is an enormous number of customers, with more than 2 million apps in Apple’s App Store and more than 3.5 million apps available through Google Play. If you have already got a product on the market or have been contemplating mobile app development, driving income has in all probability been top-of-mind. Building a sustainable stream of revenue entails defining a cell app monetization path – simply as some other enterprise does. 

App Monetization Strategies

Here are a number of monetization methods price exploring. This article will allow you to decide which mannequin most accurately fits your app.

Advertising Based

In this mannequin, customers can entry app content material without cost, and income is earned by displaying advertisements inside the app. Sometimes income is generated solely from ads, however in lots of instances, this mannequin operates in a blended monetization mannequin that additionally affords freemium service (extra on this under).

This monetization mannequin eliminates the value level barrier for first downloads and permits customers to familiarize themselves with all of the methods a product demonstrates worth. It’s vital to notice that this explicit mannequin requires a big energetic person base to generate substantial income.  

Works greatest when

  • You don’t plan to monetize instantly from customers
  • The nature of your app will end in frequent visits, many customers, and lengthy classes
  • You accumulate demographic or behavioral information

When utilizing an advertising-based monetization mannequin, it’s crucial to make sure the ads are related and focused to your person base. Poor high quality, intrusive or irrelevant advertisements may be dangerous to engagement and retention initiatives.


Interstitial advertisements are a dependable type of cell promoting. An interstitial advert will show the advert artistic inside the total cell display. Not solely do interstitial advertisements afford extra room for advert copy, however in addition they necessitate motion. Whether the person initiates a click-through or closes the advert, a response is required.

The timing and frequency of interstitial advertisements must be strategic. Intrusive ads, particularly ones that take over the person’s display, can frustrate a person in the event that they happen too usually or at occasions that don’t agree with the person expertise.  

Banner Ads

Banner advertisements can come throughout as spam from a person perspective. This format will pan into view from the highest or backside of the display. Although this format is comparatively simple to make use of, it’s sometimes not nicely obtained.

Personalization is crucial for this sort of commercial. Banner advertisements ought to be top quality and focused in any other case they’re seen as irritating and inconvenient.  

Native Ads

Native advertisements are the chameleons of in-app promoting being that they’ve situational definitions. At a really excessive stage, native advertisements match into an app’s interface with out interfering with the person expertise. In different phrases, a local commercial will undertake the appear and feel of different content material on the platform. Facebook advertisements that seem as user-generated content material are an amazing instance of this format.

Rich Media

Sometimes known as multimedia banners, wealthy media ads incorporate a dynamic factor of interactivity. Rich media banners embrace artistic points like interactive video with dynamic CTAs, parallax scrolling, QR codes, or social media parts. This advert format is extremely versatile and customizable.

Panel or List Ads

Much just like the title implies, these advertisements suggest a number of advertisers directly. The fundamental distinction between a panel and a listing advert is the quantity of actual property afforded to every commercial. Unlike listing advertisements, panels don’t embrace as many advertisements and reserve extra room for copy. With fewer advertisements, advertisers have the chance to place themselves distinctly from the competitors.

Recommended: [Infographic] A Developer’s Guide to In-App Advertising

Pay Per Download

This monetization mannequin is fairly simple. Users pay a one-time payment for downloading the app and entry to its full performance. While this mannequin permits ties income on to the variety of downloads, it’s not essentially essentially the most profitable mannequin. For one, the potential person feels unsure in regards to the precise match of the app to their wants and preferences. It’s troublesome to persuade somebody to pay for one thing they haven’t tried, particularly when there are such a lot of free alternatives.

Converting searchers into customers requires an distinctive app itemizing, nice press, glorious evaluations, and a advertising and marketing plan ready to speak the app’s worth over different, related free choices. Furthermore, the lifetime worth (LTV) of customers in this sort of mannequin isn’t essentially larger than it’s for different fashions.

Works greatest when

  • You have a robust advertising and marketing/PR presence
  • The app is healthier than related free alternatives (higher UX, further options, heightened performance, and so on.)
  • The worth is commensurate with the value, and customers are keen to pay for it
  • You need to tie income on to downloads

In-App Purchases

The majority of apps on the market provide free downloads, with the flexibility to make in-app purchases. Users should purchase gadgets inside the app, whether or not bodily or digital in nature (for instance, additional lives in a sport or gadgets from a retail app).

Works greatest when

  • You have a retail/purchasing, providers, or gaming app
  • You can nonetheless revenue regardless of the share of buy taken from Apple or Google
  • The in-app purchases ship actual worth to the customers
  • The person expertise is participating sufficient to encourage repeat use with out purchases


The freemium mannequin affords a free obtain however contains further premium options that customers need to pay to entry. This mannequin works on the flexibility to draw free customers, and entice them sufficient that they’re keen to pay to boost their expertise. The benefit of this monetization technique is customers have the possibility to attempt the app earlier than they pay for something, not like the pay per obtain mannequin. The drawback is it’s troublesome to strike a stability between providing too many or too few free options.

Driving income from a freemium app is dependent on engagement. A profitable freemium mannequin delivers an interesting expertise to each person, no matter their buying choices. Freemium apps are so efficient as a result of they construct belief by demonstrating worth and high quality with out requiring something from the person.

Works greatest when

  • You need blended income from advertisements and customers
  • Premium options add plain worth
  • The free model is tempting sufficient to draw customers and persuasive sufficient to immediate purchases
  • You have a big, energetic person base
  • The nature of your app encourages lengthy classes


Similar to the freemium mannequin, subscriptions deal with gating entry to content material relatively than options (the identical mannequin that many on-line publications and streaming providers make use of). Users obtain the app without cost and might entry a restricted quantity of content material earlier than they’re prompted to pay for a subscription, functioning as a free trial. The benefit of this mannequin is it offers builders with recurring income. However, just like the freemium mannequin, it may be troublesome to find out how a lot content material a person ought to entry earlier than they’re required to subscribe. This mannequin can also be fairly restricted by vertical; it sometimes works nicely for information and leisure apps.

Works greatest when

  • Your app is content material pushed (information, music, video, and so on.)
  • The nature of your app encourages frequent, repeat use

Recommended: How Will Your App Make Money? A Guide to Mobile App Monetization

Choosing the Right Monetization Model for Your App

Selecting the mannequin that’s proper in your app will rely on a wide range of components, however your monetization must be laid out earlier than launch. Business aims will dictate the app monetization technique that your app employs. Here are some issues to remember when planning your cell app monetization technique.

Start with the App

At the basest stage, it’s good to contemplate what your app does. What drawback does it resolve? How does it resolve this drawback? What is the service/function?

As already mentioned, some fashions will lend themselves higher to explicit sorts of apps. For instance, subscription fashions work greatest for providers like music or video streaming, information and leisure, and different functions targeted closely on content material. In-app purchases, then again, are profitable for free-to-play video games and apps centered round merchandise, for instance, purchasing/retail apps.

Look on the Competition

When you’re defining your product, competitor analysis ought to be a precedence. Researching apps which can be just like yours or are in the identical vertical is a vital side of product growth and figuring out potential monetization fashions. Namely, how are opponents monetizing? How nicely are their fashions working? Is there a spot that presents a possibility for you? Can you do issues otherwise to speed up income technology?

Look at Your Target Users

Another side of product definition that’s useful for selecting the suitable cell app monetization technique is person analysis. Who are they? What do they need? Most importantly, what are they keen to pay for, if something? As a basic rule, customers must be proven worth to make purchases. For apps which can be pay per obtain, show worth earlier than acquisition; with free downloads, the worth proposition wants to indicate by the expertise or utility of the app.

Regardless of the app monetization mannequin you select in your software, keep in mind that it’s not an afterthought. It ought to be baked into your marketing strategy nicely earlier than the launch of your app. The final thing you need is to spend money on a product that has no helpful mannequin in place for producing income.

Is your challenge prepared for growth? Understanding what cell app monetization mannequin is one of the best match in your product, and how one can drive income to maintain long-term progress is just one a part of the method. Download our mobile app development checklist to search out out in the event you’ve coated all of the bases. The listing is essentially the most complete downloadable useful resource to guage growth preparedness.


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