Grigoriy MisilyukThis article will describe popular mobile app monetization strategies and feature real-life examples of successful brands. It's not a step-by-step app monetization guide but a practical and easy-to-understand exploration of app monetization best practices.
The TeqBlaze team seasoned the article with some app monetization tips and a clear line on how to monetize an app using a combination of strategies. There are also apt examples to demonstrate the superiority of this approach.
Why is it so important to invest in mobile app monetization?
The short but honest answer is that we live in capitalism, and life costs money. Since it's impossible to argue with this statement, mobile app monetization will sooner or later become a solution to a financial issue. Even if you want to create free apps, you will need money to maintain and improve them.
There are two main options for funding development: monetizing mobile apps or seeking grant support. This article will focus on the former, leaving the latter to other experts.
What is app monetization? It is one of the stages in the software product development cycle. The need for funds will predictably increase over time, and the ability of an application to receive them depends on the demand for it from users. You should do everything possible to monetize your app or app portfolio as efficiently as possible if you know people need it. Choose those app monetization models that won't devalue your products and can create additional value. With the right approach, it is more than possible. And we are here to figure it out together.
Statistics data to consider
In-app advertising will reach a third of the global mobile app market by 2025
As you can see in the image, most people choose in-app advertising because this approach is the sincerest answer to how to monetize an app.
The number of apps available for download: the Apple App Store hosts almost two million applications, and the Google Play Store offers three million.
On average, a smartphone owner uses ten apps daily and thirty per month.
Between 90% and 97% of applications can be downloaded from public stores for free.
The global mobile app market will exceed $670 billion by 2027.
In-app advertising is the most popular monetization strategy for mobile apps, with revenues expected to nearly triple by the end of 2025, surpassing $220 billion.
4 effective app monetization strategies in 2024
This section won't provide tips like charging users a download fee. The reason is the specifics of the category. Usually, paid applications are designed to be paid from the very beginning. In this case, the developers are sure their creation covers a specific need and has no free analogs. So, they do not ask themselves how to monetize a mobile app.
Minecraft is a good example: it is a paid mobile game because there is no similar one. Another great example is one of the professional weather-tracking apps explicitly created for drone operators. Access to this data makes no sense for most users, while it helps operators plan their activities carefully.
If your application is free, the only thing left is figuring out how to monetize the mobile app. Oh, the whole world opens up here!
1. Free + Premium = Freemium subscription model
Among all the ways to monetize an app, the subscription model is the most gentle and acceptable for users. They know they get some of the app's functions for free, and the rest is paid for by subscription. However, developers usually try monetizing the free user segment as well.
YouTube is an example of a successful Freemium subscription. Moreover, the developers have applied a combined approach to monetization: most of the functionality is free but with advertising. The subscription, in turn, removes ads and provides additional functionality to users.
When designing subscription options, developers' main task is balancing free and paid features. An expert tip from the TeqBlaze team: do not turn previously free features into paid ones, but instead create additional features that will be paid from the beginning. Among all mobile app monetization options, the one where developers and owners invest in the product to create further value will always win. This is the most ethical approach.
2. In-app advertising: easy, profitable, acceptable
Together with the TeqBlaze team, we have already written an extensive article titled mobile app monetization for publishers. It overviews the most popular monetization ad networks and their pros and cons: Google AdMob, ironSource, AppLovin MAX, and white-label mobile SDK for advanced experience with state-of-the-art engineering solutions.
Let's take Tripadvisor, an app for finding interesting places, as an example. While users look for a restaurant, it advertises excellent restaurants. Isn't this the future we deserve? Or any mobile game with playable ads: while you play the game, you can take breaks from time to time to play another game, thanks to the advertising integrations, and immediately understand whether you are interested.
Key takeaway: out of all the ways to monetize apps, in-app advertising is one of the most accessible and flexible solutions. By integrating ads, modern technologies allow you to improve and deepen the user experience. That's why the TeqBlaze team is immersed in ad tech. It is space and trillions of stars!
3. In-app purchases: allow users to buy advanced experience
There is a beautiful world of in-app purchases in monetizing mobile apps. This world can be friendly to users or turn the app into a nightmare where you must pay for every action. This is a specific type of monetization, and it also requires careful balancing. Your task as a developer is to make the application easy to use without paying and a little better with payments to maintain the audience due to commercial differences among users.
Examples of in-app purchases are easy to see in games. They can be consumable: in-app currencies, extra lives, or health points. They also can be non-consumable: pay to unlock a new item design or an additional level. An apt example of a non-game app with purchases is Tinder: you can use it successfully for free, but you might also buy additional swipes to increase your chances for success.
All app monetization methods are suitable in their own way. In-app purchases are outstanding primarily for unobtrusively raising funds. This approach is usually not used alone but combined with other methods.
4. Transaction fees for organic monetization
The most specific way to monetize apps is to charge for in-app payments. It's not hard to guess: if your users don't buy or sell anything inside the application, this approach is not for you.
Ingenious applications like eBay can charge payment fees in various ways, sometimes more than 15% of the product price. The "big fee" is divided into several small ones to calm users, but the matter remains.
A little tip from cunning experts: you can add elements of internal trading to any popular application. Then, charge fees for every payment, starting with tiny ones and increasing them when everyone is comfortable. Anyone can follow Meta's path with its Facebook and Instagram. Still, success depends on the popularity of the app. New features should not devalue the basic ones.
Optimal approach towards mobile app monetization strategy
The app monetization models described can work in combination with each other. And if you think about it, the top companies use all available ways to monetize apps. But they should be implemented gradually. Below are the questions you and your team should answer before choosing and implementing a specific approach. Another hint: the engineering sharks from TeqBlaze recommend starting with in-app advertising.
Why do people choose your app?
How will your chosen strategy impact user retention?
What are the potential legal and ethical implications?
How scalable is the chosen strategy?
Who are your direct competitors?
What mobile app monetization strategies do they use?
Once you have selected a suitable monetization strategy, what other approaches can you combine it with over time?
Consider TeqBlaze as your reliable partner.
Let us introduce ourselves humbly but clearly and to the point. The TeqBlaze team is interested in helping you to master in-app advertising.
We do not offer you a premade solution with ready-to-go advertisers. Instead, we offer monetization using the SSP+ ad exchange platform and a white-label mobile SDK to enable quick application connection to the platform infrastructure. Your own platform is a standalone programmatic business, so you will be able to say that you have become a counterpart to Google AdMob.
You can connect any advertisers and manage all interaction settings flexibly. In addition, using this platform, you can connect applications of other owners for monetization with ads. They will use your infrastructure, and you will earn a commission. Such programmatic business has no income limits.
If you are interested in our offer, please get in touch with us, and we will assign an expert to discuss the details.
Final insights
According to the TeqBlaze experts, the best strategy is primarily combined. It is worth starting with in-app advertising and gradually investing in developing other methods. It is a complete opinion.
Ultimately, we thank you for your careful reading and do not thank you empty-handed. Mobile monetization is similar to website monetization, so we recommend that you explore website monetization strategies to obtain more insights. We wish you and your business prosperity!
