5 Monetization Strategies for Mobile Apps

5 Monetization Strategies for Mobile Apps

Daniel Hall 24/09/2021
5 Monetization Strategies for Mobile Apps

Monetizing a mobile app is not complicated. It only requires few simple steps to follow.

In this article, we are going to clarify the key points related to dating app monetization. Keep on reading to get acquainted with the main app monetization strategies and tips to choose the right one.

Why is Monetizing an App Necessary?

App monetization aims to turn the attention and interest of your mobile app users into income. For those, who want to develop their own app, monetization is crucial to generate revenue without funding. Considering the increasing popularity of mobile apps, this approach can be extremely effective. No need to make users pay to install a mobile app. As a rule, mobile app installation is free, and only then are users offered to pay for extra features, subscriptions, etc. 

This approach is more efficient because users can test the app and see whether it meets their needs. Monetization focuses on user experience and sometimes has a negative impact on it. Tailoring the UX to a monetization approach is a challenge for mobile app designers and developers.

The monetization strategies for apps to gain revenue may differ depending on the app type, business aims, and requirements. The strategies to monetize a dating app, a food delivery app, or an E-Learning platform are entirely different. The results of target audience analysis are the main thing to consider while selecting the most beneficial approach. Even if your app is free, you can go for a few ways to earn money on it. 

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How to Monetize an App in 2021: 5 Strategies to Choose From

Let’s take a closer look at the main approaches to monetize a mobile app. 

1. In-App Purchases

This approach is also called pay-to-play. According to this strategy, basic app features are free. If the user wants to improve the experience with an app, they need to purchase an extra feature or feature set. 

Otherwise, you can offer free access to enhanced functionality for a certain time. This improves user engagement and results in boosting app conversions. If you want to intrigue users even more, you can unlock certain paid features for a limited time. You can make users earn access to paid functionality by specific achievements or enhanced performance. It’s up to you to decide. All you need is to captivate the user’s attention and make the paid plan look more attractive. 

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2. Freemium and Subscription Plan

These models are similar in terms of user experience. According to them, app installation is free. When users interact with your app, they realize that this solution can address some problems and play a significant role in their lives. The developers can gain considerable revenue quickly, according to the statistical data. You can offer free use for a limited time after installation. This way, the users get used to the enhanced experience and are ready to pay to prolong it. This is a stable and reliable method that engages numerous users. 

3. In-App Advertisements

This is the most widespread approach used by mobile app owners. As a rule, it requires a thorough choice of companies to cooperate with. Here are the main revenue-gaining types when monetizing an app by placing ads:

  • CPC (Cost per click)
  • CPA (Cost per action)
  • CPM (Cost per thousand impressions)

The last method is probably the most popular because it has the minimum effect on user experience. Moreover, clicks aren’t necessary to earn money. 

The advertising approach of paying money to remove ads is quite outdated if used by itself. Usually, it is an addition to freemium or in-app purchases. In recent years, the importance of user experience and engagement has increased, and more developers claim that ads lose their efficiency. When a mobile app is overwhelmed with ads, it will have a negative impact on the users in the long run. 

4. Partnerships and Sponsorships

Establishing a partnership with another brand is a solid way to promote and monetize a mobile app. The main criterion for selecting a partner is a similar target audience. Delivering combined services can broaden the business reach and improve the company’s image. 

You can go for shared advertisements and convince users to download one more app. keep in mind that this approach may not be as wide-reaching as subscriptions, but the users will be interested in your services. This methodology can be beneficial for startups in their early stages as it greatly contributes to outreach

5. Combination of Multiple Methods

Many app giants, like Tinder, utilized this approach. The key is to define the right pressure points and offer the most desired and advantageous paid options. The benefit of this approach is that it covers the needs of various user segments. It is most helpful for apps with a wide target audience. While some users can’t afford to buy a monthly subscription, they can purchase a particular desired feature. Remember that you need to add enough free features and not go overboard when promoting extra ones. It is vital to create a complete experience and offer paid features and enhancements. 

The Bottom Line

Overdoing monetization and putting too much pressure on users may cause the opposite effect. We hope that our article clarified the key methods of how to monetize apps. Consider this point before building an app because it is an essential part of your marketing and sales strategies.

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Daniel Hall

Business Expert

Daniel Hall is an experienced digital marketer, author and world traveller. He spends a lot of his free time flipping through books and learning about a plethora of topics.

 

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