Innovative Approaches to Mobile App Monetisation for Future Growth

Smartphones have evolved beyond just making calls. With technology advancements, they now serve as powerful tools for communication, entertainment, productivity, and more, transforming our daily lives. With the surge in mobile app downloads and revenue, we spend more time scrolling through apps than sleeping. And don't get me started on those addictive games!

But for those who develop and sell mobile apps, the challenge lies in effectively monetising them in a crowded market. As the competition heats up, keeping up with the latest trends in app monetisation has become as important as knowing how to use emojis in a text message.

In 2020, global revenue from mobile apps exceeded 318 billion US dollars. The most popular type of app was games, with almost 100 billion downloads, followed by photo and video apps, with around 19.6 billion downloads. With the increasing number of apps in the market, effectively monetising mobile apps is becoming more complex.

To beat the complexity, we'll explore some of the most innovative approaches to mobile app monetisation in this blog post and explain how they will evolve.

Emerging Trends in Mobile App Monetisation

1. Influencer Marketing

Influencer marketing involves partnering with social media influencers to promote your app to their followers. As influencers have a dedicated following, they can be a powerful way to increase visibility and downloads for your app.

A Statista report reveals that the global influencer marketing market has increased by 100% since 2019. According to the report, the market's value was estimated to be 16.4 billion US dollars in 2022. Influencers can provide valuable feedback to improve your app's user experience. Vetting influencers to align with your brand values and goals is essential.

2. Native Advertising

Native advertising blends seamlessly with the app's user interface, making it appear like a natural part of the app. This approach is becoming increasingly popular as it can increase revenue while enhancing the user experience.

Advertisers create ads that blend in with the overall look and feel of the app's content in native advertising, resulting in less intrusive and more engaging advertisements for users. This strategy represents a form of paid media.

Unlike traditional ads, native ads do not disrupt the user experience and feel like a natural part of the app. Additionally, native ads have higher click-through rates and better conversion rates than traditional ads, making them a more effective way to generate revenue.

3. Gamification

Gamification is the process of adding game-like elements to non-game contexts. Adding rewards, achievements, and challenges can make your app more engaging and keep users returning for more. Just like a fitness app may offer rewards for completing certain exercises or reaching specific goals.

Here's an example of a language learning app Duolingo that offers badges or certificates for completing different levels. These gamification techniques can keep users returning to the app and increase user retention and loyalty, leading to higher revenue generation.

According to a recent report, this app made around 104 million US dollars in the last three months of 2022, more than 40% higher than what it earned during the same time in 2021. Due to the pandemic, people spend more time at home and using the app. Duolingo had a lot of users in 2020, and they continued to grow in 2022, with over 31 million people downloading the app in the last three months of the year.

4. Augmented Reality (AR) and Virtual Reality (VR)

AR and VR are changing how users interact with mobile apps. By offering immersive experiences, these technologies can enhance user engagement and create new monetisation opportunities.

According to recent data from Statista's research department, as of March 1st, 2023, global spending on digital advertising reached 522.5 billion US dollars in 2021. Projections indicate that this expenditure will increase significantly and reach 836 billion dollars by 2026.

5. Blockchain and Cryptocurrency

Blockchain and crypto-currency offer new ways to monetise mobile apps, such as micro-transactions and rewards-based systems. As blockchain technology becomes more mainstream, we can expect more apps to leverage these technologies to monetise their offerings.

Predictions for the Future of Mobile App Monetisation

1. AI Reshaping Monetisation

Increased Use of Artificial Intelligence (AI) is transforming mobile app monetisation by allowing for more personalised and relevant advertising. As AI becomes more sophisticated, app developers can create more targeted and effective ads.

2. Personalisation is Key

More Focus on Personalization With users becoming increasingly demanding, apps that offer a personalised experience are likely to be more successful. By providing personalised content and experiences, you can increase user engagement and drive more revenue.

3. Subscription ​

Continued Growth of Subscription-Based Monetization Subscription-based monetisation is a reliable way to generate revenue from apps. As more apps adopt this model, we can expect new and innovative subscription-based offerings.

4. Blockchain and Cryptocurrency Gaining Traction

Increased Adoption of Blockchain and Cryptocurrency Blockchain and cryptocurrency are still in their early stages. Still, as they become more widely accepted, we expect to see more apps leveraging these technologies for monetisation.

5. New Advertising Formats Emerging

Introduction of New Types of Advertising As the mobile app industry continues to evolve, we can expect new types of advertising, such as audio and video ads, to emerge.

Best Practices

A solid strategy is essential to ensure success in mobile app monetisation. Here are some best practices that are actionable and specific, centred around product development:

1. Conduct Deep Dive Research: Thoroughly investigate your users' demographics, behaviour, and preferences to understand your audience. This knowledge allows you to create more targeted ads and monetisation strategies, improving user engagement and increasing revenue.

2. Optimise Ad Placement and Frequency: The placement and frequency of ads can significantly impact the user experience. Optimising ad placement and frequency is crucial for maximising revenue without compromising the user experience. A survey of app publishers in 2021 showed that 82% of mobile gaming and 76% of non-gaming app publishers make money from showing video ads, with display ads used by 77% of non-gaming app publishers.

3. Implement Product-Centric Features: Instead of offering generic value-added features, focus on providing unique, product-centric features that genuinely improve user experience and incentivise users to engage with your app and make purchases. Examples include offering exclusive content, customisation options, and special rewards.

4. A/B Testing: A/B testing helps test different monetisation strategies to determine what works best for your app and audience. By comparing two versions of your app with different monetisation strategies, you can make informed decisions and optimise your strategy for maximum revenue and user satisfaction.

5. Stay Ahead with Industry Knowledge: Regularly monitor industry news and updates to stay informed about the latest trends, technologies, and competitors' strategies. This will help you identify new monetisation opportunities and adapt your strategy to stay ahead in the market.

6. Utilise Data-Driven Decisions: Employ data analysis to optimise ad placement, frequency, and content. Analyse user data to ensure that ads are relevant and engaging, without compromising the user experience. This can significantly impact your app's revenue and user satisfaction.

By following these best practices, you can create a successful and sustainable mobile app monetisation strategy that provides value to your users while still generating revenue for your business.

Final Thoughts

To summarise, mobile app monetisation is complex and ever-changing. You can maximise revenue and drive growth by understanding your audience, choosing the suitable model, providing value, and creating a seamless experience. Keep up-to-date with the latest trends and technologies, and test new strategies using A/B testing. You can build a sustainable mobile app business with the right approach.

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