9 Monetization Strategies For Your App


Every day, a plethora of apps are introduced in the market and become accessible to billions of users across the world. So, when it comes to monetizing, many apps face challenges as there’s always a better or affordable option for the user.


With the rapid increase in remote working, most of us are glued to our laptops, tablets, or mobile phones. In fact, 80% of our screen time is spent using various apps.

Now, this seems like an ideal scenario for the monetization of an app, right? Well, there's more to it than what meets the eye. So, let's first take a glance at the term "App Monetization" and how it can benefit you if you want to start earning from your app.

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What Is App Monetization?

App monetization is how a developer can leverage their user base to generate revenue from the app. Now, the first thought that comes to mind is, most of the apps are free, so how does it help you generate an income?

Well, there are numerous ways and methods to monetize your app, such as freemium models, advertising, in-app purchases, etc. So, by implementing various strategies, you can monetize your app and generate a steady stream of income.

In fact, the 2017 U.S Mobile App Report by Comscore shares the breakdown of user media consumption habits.


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21% of millennials say that they open an app more than 50 times a day, so the above results are not at all surprising. Millennials want everything at their fingertips, and using smartphone apps is a must, resulting in increased use of mobile app development.


On average, a consumer spends 2.3 hours using mobile apps. And this data should be your driving force to start monetizing your app if you haven't already.


You need to tap into this opportunity and target a massive number of users at once with simple monetization tactics because, according to the sensor tower, global app revenue touched $50 million in just the first half of 2020.


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App Monetization Trends That You Need To Consider

The meaning of the term “app monetization” has evolved over the years. Many strategies became part of app monetization over time.

In order to keep generating revenue from app monetization, it’s essential to keep up with the trends that can impact your strategies.

Rise of video ads in mobile in-app advertising

Video ads will continue to stay effective for app monetization. In-app video advertising is effective, engaging, and has become popular by the day as millennials prefer more visual content than other modes of advertisements.


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Video consumption has increased by a massive rate, which has resulted in high viewing rates, ultimately increasing the income of developers and advertisers.

By showing the ads based on user preference, you’re more likely to increase the CTR and generate revenue on your marketing strategy.

Video ads are expected to perform even better in the coming years.

Ineffectiveness of banner ads

Banner ads were once effective and preferred by every digital marketer, but not anymore. With advanced and more interactive, playable ads, the popularity of banner ads has started to ebb.

In fact, only 45% of ad spending was used for banners in the U.S. during the first quarter of 2019.

Marketing strategies keep evolving with the change in consumer behaviour and preferences, hence the most famous banner ads are not getting any response in the current scenario. So, it’s essential to keep up with the trends to implement the trends that will work in your favour rather than backfiring.

Increase in on-demand subscription services

The demand for subscription services in mobile apps has rapidly increased with the onset of the pandemic. The majority of business and service providers have started developing apps for their business in order to reach people even when they're at home.

Companies offering various services have started coming up with subscription plans that wary as per the clients' needs. Whether it's a fitness app or a nutrition-based app, they have developed subscription plans where their users can get access to exclusive information and content by paying a minimal subscription fee. 

Moreover, bifurcating subscription services into monthly, quarterly, and yearly plans enables you to generate more income and get long-term users.

Increased demand for influencer marketing

Influencer marketing can prove to be fruitful for your app if utilized the right way. You can use influencer marketing for advertising your services or product and reaching a fresh demographic that you can convert into paid users of your mobile app.

In fact, 17% of companies are going to spend more than half of their marketing budget on hiring influencers.

You can partner up with an influencer so they can advertise your app and encourage people to get the advanced, paid version of the app. Moreover, if you want to track how many users you acquired with the help of influencer marketing, you can generate a special discount code for the influencer so every user that comes from their platform can be tracked.

Leveraging automation to improve the marketing strategy

Your app monetization strategy must be full-proof, but what about its execution? Automation enables you to put your manual tasks on auto-pilot, so you can focus on more important activities.

Many marketers now use automation to keep track of all their marketing activities on different platforms. You can manage your mobile app campaigns and ads easily by using automation tools.

The rise of augmented reality

Augmented reality is on the path of growth because of how it connects with the user and encourages them to go for in-app buys, which the user can utilize in the app itself.



One such example of augmented reality is the IKEA mobile app wherein the users can see how the IKEA products would look in different areas of their house, which helps them in the decision-making process. This was one of the most important moments in retail industry innovation.

Another such example of augmented reality is Nintendo's Pokemon Go app, which was all the rage in 2016. The blend of real-world locations with added elements gave it a surreal visual, which was welcomed by a massive number of users.

Augmented reality adds a new dimension to your real, functional world, which helps users connect better with the app.

Top 9 effective App Monetization Strategies

In-app advertising

Advertising is one of the most common strategies for generating income from mobile apps. The process behind in-app advertising is quite simple; you collect the user information and data to show relevant third-party ads that they might be interested in. This enables you to generate revenue from the number of views, clicks, and conversions

Examples of in-app advertising are as follow:

  • Interstitial ads - these are the ads that take up your entire mobile app screen, preventing you from accessing the information that you’re interested in. These apps are more effective as they take up more space hence grabs your attention quickly.

  • Reward ads - One of the most common and effective ways to monetize a mobile app is by playing rewarding ads. If it's a gaming app, you can play a 30-second ad that will unlock a special reward for the user in the game.

  • Banner ads - many apps are still using this approach to increase their CTR. You’ll find banner ads on almost all websites; they consist of any recent search you performed and derive results based on your preferences with the help of AI.


The subscription-based approach is thriving currently, as more and more users are inclined towards getting a subscription to avoid spending extra. In fact, apps that had subscription-based strategies boosted the app store revenues amounting to 10.6 billion USD.

Paid subscription strategy basically involves charging a certain amount of fee on a monthly, quarterly, or yearly basis from the users in exchange for premium services. 

Data monetization

Data monetization is a strategy that isn't fully utilized yet and is relatively new for app developers. You can basically collect data from anonymous users and sell it to interested parties. This process of monetizing from gathering data is entirely secure as it only gathers non-personal information of your users.

All you need to do is install an SDK that handles data monetization in the back without being intrusive.

For instance, a finance management app can gather anonymous data from the users and sell it to insurance companies or banks so they can use it to optimize their marketing strategies to convert more leads. 

However, before you find companies to partner with, you need to have 50,000 average daily users for this strategy to work. Moreover, you'll also need to obtain consent from your users to collect and sell the data.

Freemium model

This mobile app monetization model is one of the most common strategies among app developers and marketers. Freemium term was generated from Free + premium, which means offering the use of mobile apps for free but with certain restrictions so later on, the users can switch to the premium model.

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The Freemium model is highly effective for monetizing mobile apps as it is offered as free-to-use in the beginning stage, which helps you get a lot of traction. After that, you can convert the same free users into paid ones with nominal upgrade options and accessibility to advantage features.

One such example of the freemium model is Youtube Music. The free version lets you stream songs and videos, but they come with ads in between, hampering the user experience. On the other hand, the premium version of Youtube Music comes with ad-free videos and doesn't stop when you switch to another app.

In-app purchases (IAP)

For instance, many gaming apps offer purchasing of coins or characters with real money is a type of in-app purchase. This way, you're letting your users play the game for free, but you're also generating money from selling virtual products.

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For instance, many gaming apps offer purchasing of coins or characters with real money is an example of in-app purchases. This way, you’re letting your users play the game for free but you’re also generating money from selling virtual products.

In-app purchases are ideal for e-commerce business models as they can operate their entire business from the app itself, eliminating the cost of infrastructure and sales employees. 

Paid downloads

This is a very basic model of app monetization strategy; you simply charge a fixed amount from your users during the time of app download. 

The only requirement for such a type of app is that it should be unique enough to be paid for in the beginning compared to thousands of similar free apps. 

As of June 2020, 91.9% of apps were available for free in the App Store, and 96.4% of free apps available in Google Play. Moreover, only 4% of android apps and 9.7% of iOS apps were fully paid.

In such types of mobile apps, you need to offer value propositions to your users and encourage them to purchase the app. However, paid app downloads don't bode well with premium or upgrade options, as the user will no longer be interested in paying an additional amount on top of the app purchase. 

Free trial

Free trials are the most common monetization opportunity for your application. A user will not be interested in purchasing a premium model of your product or service when they’re not familiar with the basic model.

Therefore, many apps offer a free trial of usually 30 days to their new users. This enables the user to get acquainted with the app, try out their features and services so they can decide whether they want to continue or not.

SMS and email marketing

Every day, millions of emails and text messages are sent out as a part of marketing campaigns, hence making these platforms very crucial for app monetization. 

Now, this isn't the direct way of generating income from the app itself. Still, it allows you to monetize your app by sending promotional and relevant sales emails or SMS of other companies to your users and get paid for it.

Charges for access to an ad-free app

This strategy is effective mainly in gaming apps where you can charge a certain amount to stop playing ads, so the user experience isn't hampered.

This option provides a better user experience by restricting the ads on your app. It’s a one-time income per user, as there aren’t any more variations available to generate income from it.

The above-mentioned app monetization strategies have worked wonders for many developers, and they can do the same for you. Many developers build multiple apps to generate new income streams. At this point, there's no limit to the growth!

However, managing your finances can be a struggle for you. To ensure a streamlined process of managing your income sources from mobile apps, you can opt for online accounting software for centralized access to all your accounting information.

Without the right tools, you’ll lose money from cracks and at this point, there won’t be clear benefits of developing multiple apps. 

App Monetization Tools

Now, you can easily monetize and optimize your apps with the help of platforms that offer analytics and predictions based on the current data. Below listed are platforms that you can utilize to monetize your app.

Google AdMob

This is the highest contributor to mobile ads with over a million users. Google AdMob enables you to advertise your app to a targeted segment of users at a certain time to increase the CTR. Moreover, it allows you to analyze the revenue and provides insightful information to optimize your future campaigns.

Facebook Audience Network

It's a targeted advertising approach that allows you to retarget your customers on various social media platforms and bring them to download your app. You have the option to choose the goal, which helps you increase the coverage and reach more people.


Chartboost is explicitly developed for gaming apps, wherein it enables you to create customized interstitial and video ads to capture your customers' attention. Furthermore, it offers an SDK so developers can monetize on their mobile apps and connect to global in-app inventory.

Above mentioned list of app monetization tools are the best in the market for analyzing your performance and creating better content to monetize the apps.

iOS vs. Android Monetization Strategies

There's always an ongoing debate between iOS and Android models; Android owns the global market share of 75%, however, iOS still remains at the top when it comes to generating revenue from mobile apps.

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The data shows that iOS applications generate almost twice as much revenue as android apps as iOS users are more likely to spend on mobile apps compared to android users.

Along with these statistics, we also need to consider that Apple is considered to be a premium product with more paid content in the App Store, which makes its users less tolerable towards ads. 46% of iOS users revealed that they're more likely to make an in-app purchase to avoid ads than 38% of android users.

The bottom line

App monetization has a huge potential in the current market, and with billions of app downloads, the revenue will keep growing. In addition to millennials, even Gen Z has contributed to the growth of mobile app revenues by using various gaming apps as well as other apps health and lifestyle.

As a developer, you can implement any app monetization strategy that can help you to reach more and more users to grow your revenue. However, before implementing an app monetization strategy, make sure to do thorough research to find out whether you want to opt for Google Play or App Store app monetization strategy.

Author Bio

Narayani Pandya

Narayani is an enthusiastic digital marketing professional, having work experience in sales and customer experience in the past. She enjoys having a cup of tea and walking on the grass when not working.