Imagining and creating a successful mobile app is only the first step. Next, you should be considering how you’ll make money using your new application. Even if your creation is already published, you can still start earning money. While monetizing your app may seem like a daunting task, this guide to app monetization outlines several benefits, methods and considerations to make so you can confidently start earning well-deserved money through your app.
What Is App Monetization?
App monetization involves generating revenue through your app and its users. When you put a lot of time and effort into building and publishing an app, it only makes sense that you’d want to make some money in return. The average mobile app user spends several hours per day using various mobile applications. Considering that there were over six billion smartphone users in 2020, that gives you a wealth of opportunities to reach mobile users through your app.
With so many chances, you also have an equal number of opportunities to generate revenue through app monetization. Whether your app already has a large user base or it’s just getting its footing, you should be monetizing your app to make the most of your hard work.
What Are the Benefits of App Monetization?
Before making adjustments to the app you worked hard to build, you likely want to make sure any changes will benefit you as well as your app users. Fortunately, there are a variety of app monetization models that allow you to take advantage of the benefits of monetizing an app while staying true to the original intent of your creation. As a result, monetization has become a popular strategy for many app developers and publishers.
With the right model, you can:
Earn some money: It may seem obvious that one of the biggest benefits of app monetization is the ability to generate revenue. If you’ve published an app, you likely put a great deal of time, effort and money into giving it the functionality and visuals you want it to have. You deserve some compensation in return for your hard work, and app monetization gives you the chance to earn a return from your investment.
Use free downloads to build your customer base: One of the oldest ways to earn money from an app is by charging users to download it. This has worked well in the past and still works for some apps today, though users are often more likely to explore new apps if they’re free to download. With some app monetization strategies, you can offer your app for free, which will likely encourage more users to download it.
Keep the user experience intact: Some app creators may feel hesitant to put ads in their app because they want to avoid disrupting the user experience. While this is valid since some forms of ads can be disruptive, there are ways to monetize your app either without using ads or by adding ads in a way that keeps the user experience intact. This is beneficial because you can earn money without drastically affecting the experience users expect from your application.
Monetize an app in various ways: App publishers can choose one or several app monetization methods, depending on what will work best for their user interface. For example, ads may work seamlessly in one app, while appearing out of place in another. Similarly, subscriptions work well in certain kinds of apps and not others. Luckily, there are many ways to monetize an app, which means developers can find a way to make just about any application into a source of revenue.
App Monetization Methods
Before you can start monetizing your app, you need to understand some of the app monetization models you could choose to implement. Each strategy can be used differently within your app, so let’s take a closer look at some of the most common ways to begin making money with a mobile application.
Paid Apps
Paid apps were one of the first ways publishers could monetize their apps, and charging users for the initial app download remains one of the most straightforward solutions for those considering how to monetize an app without ads. When smartphones and app stores first came out, most apps cost money. Though this is no longer the case — the majority of smartphone apps offer free versions — paid downloads do still represent a viable monetization method.
The more you charge for your download, the more money you’ll earn. However, you have to be careful doing this for a couple of reasons. If users are unfamiliar with your app or brand, they’ll likely be hesitant to spend money on it. Additionally, if users feel they’re being charged for more than they’re getting out of your app, they’ll look for something else. Make sure your app is worth what you hope to be paid for it.
Another price-related aspect to keep in mind is that app stores keep a certain percentage of your fee as commission — if you’re charging $.99 for your app, you won’t see the entire $.99 for each download. You should also think about your competition. If someone else is offering a free app with similar features, users will often opt for the free app instead. Be sure to consider these caveats when setting your asking price.
In-App Purchases
In-app purchases are one of the most effective ways to monetize your app. This method allows you to offer your app for free and provide opportunities for users to make purchases within it. This method is so effective because it can take any number of forms in a wide variety of different apps. While in-app purchases are found in almost any category, they perfectly suit gaming applications by allowing players to unlock special items or privileges.
For example, in gaming apps, players can use real money to purchase more lives to continue playing. Some games allow users to earn coins that allow them to buy in-app accessories or power-ups. In these cases, users have the option of purchasing additional game coins with real money. In-app purchases could also look like filters or tools in an editing app or additional exercise programs in applications geared toward fitness.
Supplying Survey Respondents
Another method of monetization is sending users to complete surveys through your app. The market research industry is always sourcing new participants to complete surveys, which means your app users could become survey respondents. When you direct your app’s users to survey opportunities with Cint, for example, both you and the user can earn money once the survey is complete. This method is ultimately a win-win for both you and your users. The more surveys your users complete through your app, the more revenue you can generate.
Additionally, surveys are a great way to keep users engaged with an app. If your app gives users the opportunity to get paid for completing a survey, they may be more likely to continue using it.
App Subscriptions
Offering subscriptions is another great way to monetize your app. In a way, subscriptions are similar to in-app purchases, as the app itself is free to download. However, the base app provides only limited functionality, while buying a subscription allows users to access the entire app and all its features. These are often known as premium features or accounts. With subscriptions, paying users get a richer experience than those who use only the free version.
Depending on your app, you could offer different subscription levels. For example, you might have free, basic and premium options, each with increased or more advanced features. Subscriptions often require the user to select either monthly or yearly payment plans, with monthly subscriptions requiring users to make the same payment each month and yearly plans providing 12 full months of service for a lump sum. Yearly plans usually offer a better per-month rate to incentivize the larger purchase.
In-App Advertising
Though there are numerous ways to make money with an app, advertising remains one of the most common. Adding ads to an application can be very effective when done right — the key is to strategically work ads into the way your app works to avoid cluttering the user experience. With this app monetization model, sponsored ads generate revenue, allowing users to download and use your app for free.
It’s important to choose the right content for your ads, as your conversion rates and user base could take a hit otherwise. Use ads that will be relevant to your app’s users and the content you created so you don’t inadvertently turn users away from your app and brand.
Keep in mind that the format of the ads in your app can make a difference in how your users perceive them — if an ad pops up at an inconvenient time, users will get frustrated and be less receptive to the ads and your app as a whole.
Affiliate Marketing
Affiliate marketing involves teaming up with other companies to promote and sell their products. Many companies offer affiliate programs that allow you to insert specialized links into your content or ads to promote their offerings. When your users click on those links, land on the company’s website or make a purchase, you get a cut in return.
In addition, you can use affiliate ads that drive your users to download other apps. The Google, Apple and Windows app stores offer affiliate programs that track when a user leaves your app after clicking on an ad for another app to go download it. You get paid for each download.
This approach works particularly well when you have a large audience that trusts your content and brand enough to take your recommendations for products and other apps.
It’s also important to remember that your prospective partners are likely to have different integration methods, so choosing the one that doesn’t hinder your app’s performance will likely be the most beneficial. The broader the selection of integration options your partner has, the more likely they’ll have one that works well with your app.
Access to First-party Data
Unlike aggregated third-party data, first-party data is more valuable than ever because it comes directly from customers. First-party data is the information your app gathers about your users, like their demographics and behaviors. Advertisers value this information because it collects direct information about an audience most likely to purchase their product or service.
As third-party cookies stop delivering data the way they previously did, apps that use data monetization will be growing in demand. Collecting data will likely be the foundation for most monetization strategies for many apps in the future.
Gathering first-party data typically works best for app owners who already have a large, dedicated user base. If you don’t have enough users to generate a decent amount of data, the information you gather may not be as valuable to advertisers.
What Kind of App Ads Are There?
Apps can run ads in several different formats, all of which can be useful and effective when placed strategically. Take a closer look at the types of app ads and how they could work as part of your monetization strategy.
Banner Ads
Banners represent one of the more discreet types of ads. They typically appear as a banner across the bottom of a screen within your app. Banner ads are effective because they don’t block much content and users can still use the app around the ad. They work seamlessly with the app while still standing out enough to catch the attention of your users. When banner ads are placed in content related to them, users are much more likely to interact with them, which is great for your app!
Native Ads
Native ads are a bit different than other types of ads because they aim to be more user-friendly. Native ads are meant to blend in, so they’re built into the feel and look of an app. These ads are geared to enhance your users’ experience instead of distracting them, allowing them to provide a better user experience and resulting in higher click-through rates.
Interstitial Ads
Interstitial ads are a popular choice because they only appear in between levels, stories, pages or other transitions in your app. They typically take up the entire screen and can be videos or still displays. Interstitial ads simply ask that users view the screen for a short time until they have the option to close the ad. When the X appears in a corner, the user can close the ad and continue through your app, finish viewing the ad or click through to the advertiser.
Video Ads
Video ads are becoming one of the best ways to capture and keep a user’s attention. In 2020, U.S. advertisers spent over $41 billion on video ads. Video ads are one of the most effective types of mobile ads, and users tend to be more receptive to them because they can be entertaining. These ads can be positioned as the first thing a user sees when the app opens, autoplay in a feed, appear as interstitial ads, or be placed before or during another video.
Rewarded Video Ads
Rewarded video ads are a special type of video ad in which app publishers provide users with an incentive to view the content. In this case, the video ads are optional, though if users choose to watch them, they receive something in return. The reward will vary depending on your app and what you choose to offer. For example, a gaming app could offer extra lives, hints or power-ups in return for viewing an ad.
If you incorporate this type of ad, be sure to time appearances strategically so your users spend more time in your app than engaging with other publishers.
How to Choose an App Monetization Strategy
Despite there being so many models for monetizing an app, some methods work better in certain apps than others. Every app is different and finds success with different methods. The most important part of choosing an app monetization strategy is knowing your app and knowing your users, which are both important considerations.
Consider Your Users
What are your users coming to your app for? Think about what they want to see in your app or get out of your app. Determine which strategy will help provide a positive experience for your users. If you know a large portion of your customer base would be unable to afford a subscription or upgrade, you’ll likely want to use other methods to avoid losing users. Considering what your audience wants and needs can help you determine the best app monetization strategy for your work.
Consider Your App
In addition to evaluating your user base, it’s essential to look at your app itself. Because some methods are more effective in certain apps or formats, you need to look closely at the way your app works, what you’re offering and how each method might look in your app. Next, you should determine what you’re comfortable implementing. For example, some publishers avoid using ads to prevent cluttering their interface.
Ultimately, a combination of two or more of these monetization methods often leads to the best results. While some methods are easier to implement when the app is created, you can always release an update later on to change your monetization model.
Adopt Best Practices for Monetization
If you’re hoping to start making money with your application, consider these tips while forming your strategies:
Track user engagement: User engagement is one of the most valuable metrics you can use to gauge your app’s chances of making money. If your app’s user engagement rate is high, it means your users are satisfied and therefore more likely to return. In addition, the more time your users spend on your app, the more likely they are to click on an advertisement or make a purchase.
Create loyalty with perks and rewards: Rewarding loyal customers is one of the most productive ways to increase engagement. Some users may not feel comfortable with in-app purchases, but you can often persuade them to buy something by offering an incentive. Loyalty perks work well when users accumulate a specific number of points to earn a reward.
Watch what strategies your competition uses: Knowing what your competition is doing to monetize their apps can benefit your plan, especially if your apps are similar in content. Keep an eye on your competitors with large user bases and the monetization methods they use in their apps. However, do keep in mind that your users prefer your app for a reason — don’t sacrifice the strategies already working for you.
Build a community: Communities are particularly beneficial for apps that feature interactive games. Players engage more and are likely to make more in-app purchases when they feel like part of a group. This practice also works well with other applications, like cooking, fitness, music or learning apps.
Consider using a hybrid strategy: The strategies that are usually most effective are those that involve various monetization methods. Some methods even complement each other when they appear side by side. However, it’s critical to remember that too many integrations can negatively affect the user experience, especially if you consolidate them in a small area.
Shorten the funnel: If you’re advertising another app that requires redirects, try shortening the number of connecting links. Multiple redirects and additional layers can create increased levels of impatience, causing users to break away before they reach the target page.
Monetize Your App With Cint Surveys
Integrating your app with Cint allows you to direct your users to surveys they can complete for compensation — which also generates revenue for you. We’ll make sure your users are paired with relevant surveys, increasing the likelihood that they will complete the survey and earn a reward for you both. Our team can also help guide you to maximize opportunities for yourself and your users. To start monetizing your app with Cint or to learn more about our brand, contact us today!
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Imagining and creating a successful mobile app is only the first step. Next, you should be considering how you’ll make money using your new application. Even if your creation is already published, you can still start earning money. While monetizing your app may seem like a daunting task, this guide to app monetization outlines several benefits, methods and considerations to make so you can confidently start earning well-deserved money through your app.
