App Monetization Methods For Revenue Generation In 2023

Guide For App Monetization Methods For Revenue Generation In 2023

Simran Dhawan
November 29, 2022
monetize app

What does mobile app monetization mean? 

The process involves creating revenue to support your app is known as mobile app monetization. There are numerous app monetization models available, many of which can be consolidated to broaden your income streams. The right candidate for your app will be determined by its vertical and target market. 

Before you even consider user acquisition (UA), you should choose a monetization model because it will influence your UA strategy. When determining the best app monetization models to use, it’s critical to consider your user journey and how it will be impacted. 

Finally, this means avoiding monetization methods that frustrate users. This will result in a negative brand image and an enhance in churned users. Finding the best mobile app monetization strategy for your app can be a difficult process, but it is also an important step on your path to profitability. 

What exactly is app monetization, and why is it necessary? 

The method used to generate revenue from app users is known as app monetization.  

This frequently includes a variety of strategies ranging from displaying banner ads at the bottom of your app to leveraging rewarded video ads and implementing integrated advertising methods, which we’ll go over in greater detail later in this piece. 

Understanding app monetization for creating Mobile app development trends is critical because there are numerous techniques available to assist app developers and advertisers in generating revenue. More pertinently, a very well app monetization strategy ensures that you’re creating a positive experience for users in order to profitably retain and grow your user base. 

In addition to this, explore what implications app monetization has on the Metaverse universe

How to monetize your app? 

In 2022, 96.8% of mobile apps on Android are free, and 94% on iOS. Despite the fact that you can charge users to download your app, freemium competitors will offer stiff competition. In order to generate revenue after installation, it is recommended for most developers that the app is free to download. 

Let’s look at the difference between free apps and paid apps 

You can generate more revenue by making your app free in the long run since it lowers the risk of trying out your app. Getting new users is more accessible and cheaper with a free app since it requires very little commitment. There are still less critical expectations for free apps than for paid ones, even though the standard for free apps has risen. 

A few app monetization models and strategies  

Users who commit to paying for an app have higher and more immediate expectations, particularly in terms of user experience. This restricts monetization strategy options and may result in a loss of long-term revenue. 

As data became more readily available, developers, advertisers, and marketers realized that in-app purchases, in-app advertising, and other diverse monetization models proved to be far more profitable. As a result, “free” apps have become the norm. 

Despite these developments, which have made mobile marketing more difficult than ever, overall smart phone app usage has increased across the board. The pandemic disrupted our normal way of life while also hastening digital transformation. 

Phones have become essential to how we stay intrigued and communicate with individuals outside of our households, which, combined with a growing market, has resulted in exponential increase in mobile utilization all around world. The increased benchmark remained unchanged as the new normal set in. 

App monetization techniques have also contributed to the fire. Mobile marketers use a variety of methods to create profitable apps, so let’s break down each app monetization model and determine which one is preferred for your app to make money

Subscription-based model for monetization 

Subscription services are another popular way to make in-app purchases. Subscriptions allow you to provide a variety of experiences to paying users than to free users of your app. 

You are not limited to an all-or-nothing approach when creating a subscription package for your mobile app. Depending on the features of your app, it may be wise to create multiple subscription packages with varying value levels. For example, you could provide a service for free, a basic subscription, and a premium subscription to various types of users. 

(IAP) – In-app purchases 

The in-app purchase monetization system is based on selling digital products, facilities, and bonus payments within the app. 

There are two types of in-app purchase revenue: 

1. In-app revenue: In-app purchases made through the app store for which fees are charged (see ahead for more). The majority is driven by gaming and subscription apps. In-store revenue alone generated $133 billion in consumer spending in 2021, a 20% increase over 2020. 

2. Out-of-app revenue: Any revenue generated directly within the app (eCommerce, travel, food delivery, transportation, etc.). As a result, it generates even more revenue than in-store. 

Advantages of in-app purchases 

We are living in a microtransaction economy, in which apps successfully generate revenue by selling in-app experiences. Anything from trying to sell sticker bundles on messaging services to chrome extensions that open up new design details in a video production app fall into this category. Dating apps may charge for characteristics that enable you to reach out to more people or improve your social profile. 

IAP tends to work well for gaming apps, especially when it strengthens an already enjoyable gaming experience. It’s a low-cost method of generating entirely separate items and in-game advantages, which ultimately drives a faithful user base. 

What sort of apps should use in-app purchases? 

Some of the most popular apps that people download on their mobile phones today have in-app purchase. For example, mobile games like Clash of Clans, Candy Crush, Pokemon Go, and Harry Potter: Wizards Unite have successfully used in-app purchases, as have non-gaming apps in eCommerce, transportation, social, and production-oriented operations. 

4 methods for improving your in-app purchase offerings 

The development roadmap of your app can be laid out based on your in-app purchase model during the development stage. As a result, resources will be saved in the future. 

Create a creative branding opportunity around in-app purchase offering. Consider naming your offerings in creative ways. You will be able to make your monetization model more engaging this way. 

Provide users with discounts on multiple in-app purchases by implementing bundle offers. Don’t miss out on these opportunities to boost revenue, as some users may be willing to spend more for a better deal. 

Automate your app’s user funnel so that users will spend money on your app once they’ve moved down it. This can be accomplished through the automation of push notifications, emails, and in-app messages. 

Most suitable practices 

Propose a beneficial upgrade 

The most effective way to attract paying customers is to provide an amazing experience on top of an app they already use. To generate long-term revenue, in-app purchases must be comprehensive and engaging. Evaluate out what your users find to be the most valuable, whether it’s providing an ad-free experience or opens a world to premium content. 

Complement this by continuously optimizing pricing based on geography and user segment. Experiment with special offers to see how different market segments respond to different price ranges. 

Using predictive modeling, you can keep an eye on performance. 

Easily make promotional optimization decisions by using predictive modeling. By defining the key trends that your most profitable users exhibit, algorithms for machine learning can foretell and inhibit user attrition. 

It can predict, for example, that your most lucrative users will finish the very first five levels of a tournament within the initial hour of play. You can use that information to promote in-app purchase decisions and customize your communication accordingly. 

In games, create multiple currencies. 

Make both soft and hard currency. A soft currency can be compensated for certain actions within a game, providing a sense of progression and growth. Hard currency can only be obtained in small quantities through tough in-game activities and should be purchased with real money. Whether it’s extra lottery draws, unique armor, or leveling up your profile, this enables consumers progress faster in the game. 

Stay away from being categorized as a pay-to-win game. 

Partitioning in-game purchases can help preserve the value of in-game monetary system while generating real-world revenue. It is critical to maintain the value of in-game currency that anyone can earn in order to keep the game challenging and accessible to everyone. If other players believe a game is pay-to-win, an imbalance could lead to higher churn. 

Models of advertising monetization 

In-app advertising is the most common method of monetizing mobile apps. In fact, half of all mobile gamers prefer free ad-supported games. For apps that want to remain free in the app store, this method provides a valuable source of revenue. Providing content and ad formats that are relevant to your users can result in a positive user experience. 

Here are a few formats to consider 

Banner ads: Advertisers can place static or animated ads across a banner within your app using this relatively simple ad type. Banner ads must have appealing graphics and a compelling call to action (CTA). 

Interstitial ads: This layout showcases ads in a full-screen, expanding experience. As a result, interstitial ads are much more likely to avoid “banner blindness,” a condition in which users have become so accustomed to banner ads that they no longer register them. Because full-screen interstitials can be distracting, they should be positioned at natural pauses, such as in-between levels of a gaming app. 

Native ads: These are paid advertisements that are tailored to the content that the mobile app user is viewing. 

Playable ads: are a type of try-before-you-buy advertisement that exposes users to engaging gameplay. Before being served a CTA, users are given a brief glimpse of the advertiser’s app. Because users who choose to download will possess a predetermined interest in the gameplay, this is an excellent method for advertisers to decrease uninstall rates. 

To sum it all up 

So, which of the above monetization methods will be most effective for your app? At the end of the day, for the best results, you’ll need to combine multiple monetization methods. You must create a comprehensive strategy that incorporates more than one of the methods described in this article to guarantee you are going to generate the most revenue possible without interfering with the user experience. Running ads while also giving customers the choice to pay for an ad-free experience is an outstanding demonstration of how two monetization methods can work in tandem. 

Cerebrum infotech delivers custom and success-oriented Mobile app development services that yield positive outcomes. Reach out to us in for industry-grade app monetization, Mobile App Launch techniques and get expert support right away! 

Connect with your mobile app development company now! 


In-app advertising is the most common method of monetizing mobile apps. In fact, half of all mobile gamers prefer free ad-supported games. For apps that want to remain free in the app store, this method provides a valuable source of revenue. Providing content and ad formats that are relevant to your users can result in a positive user experience.

The method for generating revenue from app users is known as app monetization. This frequently includes a variety of strategies ranging from displaying banner ads at the bottom of your app to leveraging recognize and reward video ads and highly established marketing techniques, which we'll go over in greater detail later in this piece.

App monetization is the process by which app developers and publishers generate long-term revenue from an app's user base. Simply put, it is how an app generates revenue.

5 methods for monetizing your app:

  • The model of free and premium app versions. Offering both free and purchased versions of your app is a successful mobile money - making strategy

  • The model of a free app with in-app purchases

  • The app is free with a monthly subscription

  • The model of paid apps

  • The model of collaboration.

Simran Dhawan

Simran is a keen enthusiast when it comes to sharing her thoughts. With more than several years of experience in content management and working with clients of all stature, gave her the critical understanding of always presenting with the best.

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