Comprehensive Guide to Mobile App Monetization: Strategies and Models - Prismetric

Comprehensive Guide to Mobile App Monetization: Strategies and Models


The process of leveraging an application’s user base and converting its engagements and actions into a stream of revenue is known as mobile app monetization. Mobile app monetization is a specific framework that defines how an app drives revenue and generates ROI-return on investment.

Now, the real question is how do you make money with an app? Many people come with unique app ideas and work on creating an app, but the money-making angle holds them back. Whether you are developing an app for the first time or making changes to the existing one, there are many different ways to monetize an app which we have highlighted in detail here.

How do I make money through an app?

Mobile applications need to be tailored to fully fit users need to have the maximum effect on your business. By implementing the right monetization strategy and choosing the right model you can maximize your app revenue. We have outlined the right app monetization strategies that will guide your business to acquire more profits.

The mobile app monetization strategies fall under two categories such as:

Direct Monetization:

The money generated straight from the app is known as direct monetization. When a user downloads an app from the Apple or Google store and pays for your eCommerce app, the sale comes directly from your app.

As the name implies, direct monetizing is simply the revenue you can make by applying winsome app monetization models that we will discuss below.

Indirect Monetization:

Among software products, indirect monetization is quite popular. One of the best examples of indirect monetization is independent digital products that come along with a free app. In such cases, the app is secondary, so you are going to make money regardless of the app usage.

This is a clever app monetization strategy of creating a mobile app to make the product look more alluring to the potential customers as it improves the user experience.

Also Read: How Market Research can help with successful Mobile App Development?

9 Effective Ways to Monetize a Mobile App

You did it! You made a fantastic app for your business, your customers are interacting and the data is impressive and helping you think about different ways to monetize an app.  App Monetization strategies can be implemented with a wide variety of customized features. But how do you turn your app into a profit-generating machine?

Here is a complete list of the most effective ways and mobile app monetization models that can help you accomplish it: 


Digital advertising is a phenomenal opportunity for mobile app monetization as it dramatically improves the branch of communication between consumers and advertisers through mobile applications. This is because of the crazy amount of time people spend on their phones. Reports state at least 90 minutes a day which equals twenty-three days a year. So, how do you use this data to your advantage and monetize your app? There are typically three types of ads advertisers create such as:

Interstitial ads: Interstitial ads, also known as full-screen ads, are typically displayed in the flow of an app at its natural transition points between activities like moving across the menu.

Banner ads: Banner ads are a form of online advertising by an ad server usually found at the bottom or top of the mobile screen. They do have a tendency to irritate your users as they are more distracting than others, so you should give second thoughts before agreeing to banner ads.

Notification ads: Notification ads are displayed as pop-ups and serve the purpose of alerting the users of the app’s presence. While somewhat intrusive, push notifications are highly effective.

Rewarded Ads: Rewarded apps are one of the most popular ways of mobile app monetization as they increase advertising revenue. It provides an opportunity for the users to engage with playable ads in exchange for a reward within the app.

Video Ads: A video ad encloses online display advertisements that have video within them. Most of the video ads are bought, sold, and displayed programmatically by using various interactive elements and targeting methods.

Email lists

An email strategy for your app is an amazing way of getting more engagement from your app users. This engagement, in turn, returns to more revenue from your app.

Emails have a lifespan of 12 days and the most reliable way to get email addresses is simply by adding an email form to your app. This will mark as a real boost by prompting users to enter their emails, seeing it as a possibility of more significant benefits.

An email marketing campaign really works and makes an impact because people rarely change their emails to see your content and engage in it. These emails help keep your brand at the forefront of their mind and make them buy from your business.

Partnerships and Sponsorships

Partnerships and sponsorships are pretty worthy of your attention as they have the power to step your profit-making game significantly. The first step to this app monetization strategy is finding a suitable partner with an equivalent customer base that can add experience to your users and value to your app.

Mutual partnerships can add severe benefits to your business, especially when you create a coherent experience by thinking about the optimization and logistics combined together to deliver mobile analytics.

The latest addition to the world of Mobile app monetization is sponsorships, where agencies and brands with a similar user base pay you for an exclusive spot in your app and promote content related to it. It increases user engagement and retention and helps you increase revenue by taking your share from the redeemed rewards these brands provide to your customers through in-app activities.

Strong code and white labeling

Strong code is the backbone of any app. You can develop your own code and if it turns out lucrative, other brands may approach your code and offer reliable strategies which are profitable to your business. It is wise to make money by licensing your code to different developers without causing turmoil in your users’ experience.

White labeling simply means you are creating a product that other business people can buy from you, rebrand it and even sell it to others. There is a steady demand for white label applications as it enables you to earn revenue from multiple sources. It is also a great option if you are having a hard time selling the brand under your name.

In-app purchases

One of the most widely used app monetization models revolves around both free and paid apps. The in-app purchases monetization method enables users to buy various digital goods.

For instance, users playing any mobile app game could spend money to unlock in-game currency, new levels, additional app features, customization, and much more.

The foundation of the in-app purchases monetization model is that the free outlook must be fully functional and effective. In contrast, in-app purchases should only be used for magnifying and enhancing user experience.

Now, taking a look at the statistics of this model, in-app purchases are currently generating over 47% of revenue among the apps across the world. Although only 5% of users engage in this model, the revenue generated is 20 times more than the revenue earned from other monetization models.

SMS marketing and newsletter

This app monetization strategy is an excellent way of keeping in touch with your customers by regularly sending updates on discounts, promotions, contests, upcoming events, promotions, and reminders.

SMS marketing increases user engagement and strengthens your brand by tempting the users to visit your app. If you are looking to provide your audience with new and fresh information, a paid newsletter is the best option as it significantly increases revenue.

Data licensing

When your app starts getting a regular large number of active users, you can collect this user data and sell it to third parties. These data mainly include user behavior and tactics that can be pretty useful to advertisers and analytics companies.

Data licensing shows advertisers the relevant aspects they can work on improving and the prices they are willing to pay are rapidly increasing. So, leveraging the situation, you need to just collect valuable and precise data for data collectors.

Finding a reliable app monetization partner and abiding by all the security and privacy rules is crucial, but once you are past that, data licensing proves quite lucrative.

E-commerce apps

An E-commerce app is a straightforward way of monetizing a mobile app as it allows you to sell physical goods in the digital storefront through your app. Building an application focusing on the eCommerce models and strategies that blends in with content-centric brands record higher profit margins.

We are all well aware of the boost online shops are getting these days due to the high rate of its influence and streamlined shopping experience. So, suppose you provide the customers with a better, faster and simpler shopping experience than the traditional shops. In that case, there is no doubt that your eCommerce business will thrive especially when it comes to brick-and-mortar stores.

Also Read: Top 6 Reasons to Choose Progressive Web App for Your Ecommerce Store

Subscription models

The subscription app model offers paid content and allows the users to utilize all the special enhanced features added to the app. Under this app monetization strategy, users are convinced to pay a repetitive fee for the content in your app.

Currently, subscription models are encountering an expanding interest as it attracts a large number of users, increasing app engagement.

Premium apps

Premium apps are an upfront way of adding revenue to your business with each successful subscription or download. Although just 5% of apps in the Apple and Google play stores are paid apps, this app monetization strategy has by far proved the most profitable one.

Premium apps are simply about creating a uniquely different version of your app with an enhanced user experience.

Freemium apps

Freemium, the word, is an amalgamation of free and premium. Just like the name, it means providing users with privileged access to additional functionalities and features included in both versions.

Freemium models regularly incorporate in-app purchases that generate recurring revenue for the business and the best part is that they cost nothing to download.

How to choose the right app monetization strategy for your app?

If you want to grow your business, gain profit, and attract more users here are a few useful tips for creating a wholesome monetization strategy:

  • Understanding your target audience
  • Define specific elements within the app
  • Focus on being in the long haul
  • Gain trust and provide value to your users
  • Set your goals for the app and work specifically on them
  • Keep a keen eye on what your competitors are up to
  • Give user experience your top priority
  • Aim on being original and valuable
  • Use insights to your advantage
  • Keep updating and upgrading your app
  • Contemplate on the type of monetization model you choose
  • Keep up with the new trends in the market
  • Get feedback from your users

Also Read: 8 Easy Steps to Create a Successful Mobile App

What is the future of mobile app monetization?

The entire mobile industry is thriving and the growth is not showing any signs of it slowing down in the coming future. There are over 3.5 billion smartphone users across the world, so saying that the mobile app industry is rapidly increasing is an understatement. If you need any help in mobile app development and app monetization strategies, feel free to get in touch with the expert app developers at Prismetric

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