Here’s a common scenario: you have a free mobile app and you want to launch it. However, you’re afraid that your hard work will not receive the revenue it deserves. Don’t worry, Soomla brings you the six best mobile app monetization strategies that are certain to bring you well-deserved profit.
App monetization is the process of turning your app into a steady source of income. This is crucial in this day and age, especially considering the amount of time people spend using smartphones and the rate of global app revenue growth. Additionally, free apps far outnumber the paid ones, both in terms of revenue and downloads, which is probably one of the reasons you chose to create a free app in the first place.
Now let’s take a look at some of the app monetization strategies that will be popular in 2019.
Advertising remains the number-one strategy when it comes to earning revenue from free apps. Here are some of the best:
- Video ads: Whether they are interstitials (popping up at certain transition points) or rewarded ads (offering rewards for watching a video), the popularity of video ads will continue to grow in 2019 as the U.S. mobile video ad spend is projected to increase by 22.6% to reach a staggering $15.93 billion, according to eMarketer.
- Offer walls: An oldie but goodie, offer walls are pages where a user can purchase virtual content or additional in-game features in exchange for completing an action and/or paying real (or digital, if you’re really looking to get in with the trends) currency. With a great eCPM (effective cost per mille) potential, offer walls are an effective way of generating ad revenues without negatively affecting user experience (UX).
- Banners: This type of ad can be placed at the bottom or top of your app’s layout and remains on-screen while the app is being used. Although they don’t generate enormous amounts of money, banners are a nice way of helping you yield some revenue in the beginning.
- Notification ads: These ads show up in the device’s status bar, increasing the user’s awareness of the ad’s presence. Be careful not to overuse them, as there is a fine line between annoying and useful with these.
- Playable ads: Another increasingly popular in-app ad format with high conversion rates, playable ads let the user instantly play a part of the game advertised, so they could experience first-hand how the app works and decide if they like it before buying or downloading.
As the gaming industry is changing, we will continue to see Ads as the prominent business model continue to rise. The forecasts for mobile app ad revenue are expected to grow significantly and surpass in app purchases.
2. In-App Purchases
This strategy refers to buying virtual content and additional features. These features can include anything from adding visual customizations to the game, new levels and options, extra lives, power-ups, custom characters, and weapons upgrades to premium features such as removing ads or fully transferring to the premium version.
Many apps today still rely on this business model for a large portion of their revenue. While this model will not fade away anytime soon, it will soon be dwarfed by ad revenue.
3. Purchasing Merchandise
Speaking of purchases, not all of them have to be strictly concerning virtual goods. A smart way to secure additional income is by selling merchandise. Angry Birds, for instance, has earned quite a lot of greens by selling plush toys of their characters. You could also sell customized T-shirts, lunch boxes, mobile phone covers, collectible figurines, bumper stickers, posters, tote bags, and more.
4. Subscriptions and Paywalls
This strategy has increased in popularity with the rise of streaming apps such as Netflix, Pandora, and HBO NOW. It refers to unlocking gated or limited content or bypassing some restrictions if the user signs up for a subscription. In addition to opening new ways for income, this gives you access to people’s email addresses which you can then use for additional marketing campaigns and customer engagement.
5. Sponsorships and Partnerships
Signing a partnership or a sponsorship deal with another brand or advertiser can increase both your own and your partner’s user base, allowing you to earn more money. Hyper-casual games, for instance, are an especially fertile ground for cross-promotion via ads and this strategy can even help them go viral.
6. Data Monetization
Obtaining useful insights into your customer’s behavior and selling this data to other advertisers or major analytics companies is another great way of gathering additional income off your app. Just make sure you are not in breach of any data privacy and liability regulations and that your users know what you’re up to.
With Great Power Comes Great Responsibility
And there you have it. These six strategies will help you grow your app’s income, should you use them wisely. By “wisely” we mean something like taking care that you balance the game economy when offering in-app purchases like power-ups and extra lives, making sure that your ads are carefully selected, timed and placed within the app, as well as constantly testing the UX. Always put yourself in your users’ shoes and ask yourself what they would like (or hate) to see in your app.
If your game uses ads and you want to track the LTV per unit, segment and testing groups, check out SOOMLA’s Traceback.