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In 2020, the American mobile ad landscape was dominated by video and interstitial advertisements. Users of mobile applications are likely familiar with these ad types, which appear upon app launch or while transitioning between app pages. The revenue from these advertisements hinges on user engagement, in terms of clicks, installs, and purchases. Simply displaying these ads within an app can turn into a viable revenue stream.

Leveraging Referral Marketing
Referral marketing can be regarded as an alternative form of in-app advertising. The crux of this strategy involves endorsing an affiliate product or service within your app and earning a commission based on clicks, views, impressions, or downloads. It is critical to attract marketers who find your user base appealing to increase your earnings. The higher your user engagement, the more profitable your free app becomes.

If seeking affiliates seems daunting, affiliate networks such as AdMob and InMobi are at your disposal. These platforms offer various monetization options, including CPM (cost per mile), CPC (cost per click), CPV (cost per view), and CPI (cost per install). A practical example is Amazon, which advertises a variety of products within its app. As users interact with these ads, they are exposed to items from other vendors.

Promoting Amazon’s ads can stimulate your audience to make purchases on Amazon, and you earn a commission for every redirected sale.

Capitalizing on In-App Purchases
In-app purchases are generally classified into consumable and non-consumable categories. Consumable purchases, such as in-game currencies and extras, are temporary and need to be bought multiple times. Non-consumable purchases, like unlocking new levels or ad-blocking features, are permanent. Small charges for individual features or consumables often appeal to users, as they are ready to shell out minor amounts for an improved experience. A prime example is the game Two Dots, which offers extra moves and a power-up for $0.99.

While the app store handles all transactions related to in-app purchases, developers are tasked with integrating requisite features and devising an effective marketing strategy. The main drawback of this model is the substantial commission fees imposed by app stores.

Implementing Subscriptions
Through subscriptions, users can unlock more functionalities of an app for a specific duration. Apps ranging from productivity tools and graphic editors to cloud services and digital news outlets use this monetization strategy. Usually, a free trial or limited access is granted to lure users. For example, Lightroom offers users the ability to test premium tools and apply filters, but a subscription is needed to fully utilize them. Developers often create multiple subscription tiers, with varying durations and feature sets, to cater to different user needs.

Exploring Sponsorship Opportunities
Collaborating with a company with a similar audience and a robust marketing budget can be mutually beneficial. Your app receives sponsorship, while you advertise their offerings. Advertising can take different forms, including in-app ads, content sharing, and integrating the sponsor’s branding into the app design. The key goal of such a collaboration is to familiarize your users with the sponsor’s brand.

For example, PlayerUnknown’s Battlegrounds (PUBG), a popular battle royale game, partnered with Tesla to integrate themed locations and electric vehicles into the game. Revenue from such a partnership can be generated by sharing profits with the sponsor or by levying a monthly sponsorship fee.

Email Marketing Endeavors
As an app developer, you can construct an email list by leveraging two potent methods: popup forms asking for emails, or using Facebook SDK for users to sign up and provide their emails. Offering a reward or incentive can entice users to share their contact information. It’s crucial to adhere to GDPR regulations and gain explicit consent from users before using their data, as people tend to safeguard their email addresses, personal information, and privacy. After completing these steps, developers can send out enticing emails that pique interest and prompt users to engage with content or purchase specific products.

Merchandising your App
Despite the digital realm’s dominance, we live in a tangible world. Therefore, selling merchandise associated with your brand can be a smart move. One of the key objectives is to heighten brand visibility and gather a host of brand ambassadors who will fervently promote the app.

Video games are a prime genre for implementing a merchandising strategy. Avid gamers are often willing to buy merchandise like t-shirts, stickers, or cups featuring their favorite game. Competitive online battle arena games such as PUBG and DOTA, as well as casual puzzle games like Angry Birds, have capitalized on this by offering their own branded merchandise.

Charging Transaction Fees
If your strategy doesn’t involve ads, merchandise, services, or feature selling, you might consider adding a processing fee to online transactions within your app. A slight addition to the total cost could result in substantial profits without imposing a significant burden on your users. This approach can be more beneficial than other strategies requiring hefty investments. FinTech applications provide an excellent example of this kind of monetization.

Crowdfunding your App
Crowdfunding emerges as another viable option if in-app purchases or advertisements don’t align with your strategy, or if you’re struggling to garner a sizeable audience. Platforms like Indiegogo, Kickstarter, GoFundMe, and Fundable can help amass funding, or you can reach out to your social media followers, friends, and family for support. While it might be challenging to raise millions, success isn’t out of reach. The game Near-Mage, for instance, aimed for $29,000 but ended up collecting $141,000 from backers by December 2021, and the funding continues to grow.

Do you need guidance in choosing the most profitable monetization strategy for your app? Our experienced team at Orangesoft is here to help. We can provide insightful guidance throughout your app’s creation process, leveraging our vast experience in the app industry. Don’t embark on this journey alone – let an Orangesoft advisor assist you!