Use our monetization platform and strategies to effortlessly generate revenue from content in your mobile app
What is mobile app monetization?
Mobile app monetization focuses on generating income from apps. There are two main strategies used by mobile app publishers to maximize their ad revenue by efficiently managing the process of selling ad inventory to advertisers:
- Waterfall mediation is a sequential method of ad monetization where ad requests are sent to multiple ad networks or demand sources in a predetermined order, resembling a “waterfall” flow;
- Bidding management is a more advanced monetization technique that involves real-time auctioning of ad inventory to multiple demand sources simultaneously.
Importantly, the main tasks performed during app monetization include:
- Bidding optimization – this involves setting minimum effective Cost Per Mille (eCPM) floors to secure the highest possible bids for ad placements in different countries or regions;
- Waterfall optimization – despite the shift towards real-time bidding, traditional waterfall setups still contribute significantly to revenue. Waterfall optimization entails adjusting, removing, or relocating eCPM placements within ad networks to maximize earnings;
- Ad quality control – ensuring the quality of displayed ads is crucial. Ad Monetization Managers must monitor ads to prevent harmful, incorrect, or competitive ads from appearing;
- Ad event design – involves planning and implementing when and where ads appear within an app. It also includes conducting A/B testing and tailoring ad strategies based on user segmentation. This approach helps optimize the quantity and presentation of ads to enhance user engagement and increase revenue.
Overall, effective app monetization involves a combination of strategic ad placement, continuous optimization, quality control, and the use of advanced tools to automate and streamline processes.
Mobile app monetization strategies
There are several approaches you can take to achieve satisfactory revenue. You can rely on a single monetization method, such as in-app advertising, in-app purchases, or subscription models. Alternatively, you could blend several strategies to diversify your revenue stream. It is important to remember that success in mobile app monetization is not solely dependent on the chosen strategies. The advancement and progress of your app also play a crucial role. This includes continuous updates, feature enhancements, and maintaining a user-friendly interface. Additionally, user behavior significantly impacts your revenue potential. Here, you can learn more about every important mobile app monetization model all app developers should be aware of:
- Paid apps operate on the principle of collecting money upfront before users can access the product. Once the one-time payment is made, users gain full access to all features without additional charges. These apps typically do not include ads. For developers, providing detailed screenshots and thorough descriptions in the app store is beneficial in informing potential users about what they are purchasing. One-time payment models are particularly suitable for apps that do not frequently update their content or offer a specific, high-quality service that users are willing to pay for;
- Subscriptions can attract users who prefer an ad-free experience or value exclusive content, such as specialized insights or rare knowledge. Typically, users opt to subscribe after learning about the app or receiving a recommendation. While this model can establish a reliable income, persuading users to pay, especially when your app is new and has not so many downloads, can be initially challenging. Incorporating subscription services can establish a consistent revenue stream for apps that offer regularly updated content and diverse features. This approach enables users to unlock premium content and features, cultivating a dedicated user base. It’s essential to transparently outline the advantages of subscribing, including premium content, features, and terms of use, such as the permissible number of devices per account. Additionally, informing users about auto-renewal policies and cancellation terms is crucial;
- In-app purchases (IAPs) offer a significant revenue stream by providing premium items or features that users can buy with real money. These purchases can be a central part of the in-app economy. There are two main types of in-app purchases: consumables, which are single-use items that can be bought repeatedly (like extra lives in a game), and non-consumables, which are permanent features that only need to be purchased once (like a new piece of clothing in a game). Although only about 2% of users typically convert to paying customers, the revenue generated from in-app purchases can be substantial;
- In-app advertising is a popular monetization method for mobile applications, allowing app owners to sell ad space to advertisers and offer the product for free to users. Striking a balance between maximizing earnings and maintaining a positive user experience is crucial. Ads should not be too frequent or invasive, and various strategies exist to integrate ads seamlessly without disrupting engagement. Effective methods include presenting ads during natural breaks in the app, such as loading times. Ensuring that ads are relevant to the app’s content is essential to avoid negatively impacting user engagement. The most commonly utilized ad formats within applications are Banners, Native, and Interstitial ads. Each of these serves a unique purpose and is integrated in a way that complements the app’s User Experience.
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Types of mobile ad formats
It is up to the content creators to determine how to design the ad layout and which formats to incorporate. We have compiled a list of the most popular mobile app ad formats to assist you in creating the best strategy:
- Banner ads are rectangular and take up just a part of the screen, whether static or animated, they come in a wide range of sizes. Banner ads are among the most common ad types, as they are easy to implement and can be displayed in many different places, for instance, at the top or the bottom of the screen;
- Interstitial ads are another popular ad type, they occupy the full screen and are particularly well suited for loading breaks or interludes. This ad type offers good visibility and engagement, oftentimes reflecting in a higher Click-Through Rate (CTR);
- Rewarded ads can complement your ad layout really well as they offer users the chance to earn in-app items by either engaging with or viewing an ad. These ads can enhance User Experience and engagement, potentially leading to more in-app purchases and improved retention. This format benefits both users and developers: users gain in-app rewards, while developers see increased engagement;
- Native ads are designed to blend seamlessly with the surrounding content. Due to their advanced integration with the app, they do not disrupt the User Experience. It is important to ensure that they are clearly labeled as advertisements to avoid any confusion with the app’s original content. They can be displayed in various places, and they come in many forms like Banner App Install ads or In-Feed App Install ads, which blend seamlessly with the app’s content, providing basic app information and often incorporating a video, image, or icon with a call to action to encourage users to install the application without feeling like they are viewing a typical ad.
Benefits of mobile advertising
In-app advertising has become a highly effective monetization strategy for mobile app developers. Mobile users spend the majority of their screen time on apps, so this kind of monetization model has a lot of potential. It is also relativity easy to achieve a high level of ad personalization, for instance, by utilizing location-based marketing. Mobile devices provide exceptionally precise targeting, defining exact areas like a specific parking lot, airport, or store. What’s more, mobile app publishers can also benefit from higher Click-Through Rates and conversion rates compared to traditional and mobile web ads.
Bidlogic – making ad monetization easier
Managing app ad monetization for mobile app publishers can be challenging due to many factors: the complexity of ad networks, requiring navigation of numerous platforms with varying rules and formats, and the need for constant optimization to achieve the highest revenue while balancing User Experience and addressing market variability, technical challenges, and security concerns. Developers can enhance their efforts by partnering with monetization specialists like Bidlogic for task automation and better ad monetization results. Bidlogic stands as the pioneering optimization tool designed to automate managing advertising waterfall and bidding auctions, thereby minimizing the time spent on manual eCPM/bidding instance management. When it comes to bidding optimization, by consistently analyzing network trends, historical data, and conducting A/B tests, our algorithms adjust bid floors to maximize eCPMs and fill rates. In the case of waterfall, we manage the order of the eCPM instances. You can also utilize intelligent bidding methods to control the process of the A/B testing on AppLovin MAX (and soon on Unity® LevelPlay). Don’t hesitate and click “GET STARTED” located in the right corner of the screen, to get up to a 50% raise in AD ARPADAU!
App monetization refers to strategies used by developers to generate revenue. Key methods include bidding optimization, setting eCPM floors to secure high bids, and using tools like Bidlogic for real-time adjustments. Despite real-time bidding, traditional waterfall setups still contribute significantly, requiring continuous optimization. Ensuring ad quality is crucial, with tools like ironSource’s Ad Quality tool to remove undesirable ads. Ad events design involves planning ad placements and conducting A/B testing. Effective monetization combines strategic placement, optimization, quality control, and advanced tools, requiring adaptation to market changes to maximize revenue potential.
