You’ve created the ultimate app, and now you’re looking for ways to monetize it. Here at CodeFuel, we have created this in app advertising guide to help you plan your monetization strategy and select the best monetization networks for it. It’s going to be a handful, so let’s get started.
App Monetization Statistics
First, let’s review some statistics that show how app development and monetization have grown in the last years.
1. There are 3.6B smartphone users in the world
More than half of humankind uses a smartphone nowadays, and the number is still growing, expecting to reach 4.3 billion users by 2023.
2. The number of apps in the Google Play Store reached 3 billion by December 2020
The pandemic stalled applications’ releases, lowering the number of applications to 2016’s levels. At the end of 2020, however, we could see a recovery tendency and now the number of apps surpassed 3 billion.
3. Which Apps are the Most Popular?
What types of apps do people use the most? 97% of people use Communication and social apps, followed by Shopping, Entertainment, and Search, which are used by 95% of users and over 60% of users have a Gaming app on their phones.
It is not a surprise then, that social apps like TikTok and Instagram were the most downloaded in 2020. Communication apps like Zoom and Messenger following close as most people rely on them while working from home or remotely.
4. Over a half of web traffic is coming from mobile devices
The percentage of people using their mobile phones to access the Internet has skyrocketed in the last years. On February 2021, over half of all Internet traffic came through mobile phones, compared to 42.9% of desktop traffic and a mere 2.85% from tablets.
5. Mobile Ad Spending is increasing
With more than half of web traffic coming from mobile devices and growing, it is no surprise that mobile ad spending is increasing too. According to Statista, mobile ad spending will surpass desktop ad spending by 2022. From $189 billion in 2019, we can expect companies to spend over $240 billion by 2022.
In-app advertising is a market in expansion. In fact, Mobile in-app advertising revenues are projected to reach over $900B by 2023. This provides a great opportunity for app developers and marketers to tap into the market.
Why is this? Because In-app advertising works. In-app ads have a 10% higher engagement rate than mobile web apps, according to a recent report. In addition, the click-through rate of interstitial ads is 18 times higher than that of web ads.
While banners are the cheapest, they also are the less effective. Interstitial display ads are more expensive, but the CTR is much higher. Native ads have also higher conversion rates. Therefore, if you want your app to convert, in-app advertising can be the solution. True, it is a very competitive market, but let’s explore how you can actually make money from your app with in-app advertising.
What Is In-App Advertising?
In-app advertising refers to the type of ads that you find in mobile apps. It may include banners, videos, and images that are displayed right when you play the app.
How In-App Advertising Works
To use In-app advertising, you dedicate a portion of your app’s digital real estate, installation or workflow to advertising. To do this, you pair up with an advertising network specialized in in-app advertising.
There are three key steps to start monetizing your app using in-app advertising:
- Choose an ad network
- Select the type of ad
- Choose the right ad monetization model
Types of ads you can find in an app
The right type of ad can make or break your monetization strategy. According to the add type you choose, you can drive clicks or annoy users. You can use video or image ads, text, and interactive. As we saw above, native ads and interstitial ads perform better than banners. Let’s see which types of ads are the most popular.
You can include these ads in any kind of app. They can appear at pre-defined moments when the person is using the ad or during transitions. You can set them to appear triggered by opening the app or when doing a specific action.
- They get noticed
- They give a quick way to convert.
- They can annoy the user
- They can cover the actual content
Besides the detractors, pop-up ads actually work. According to a study by SumoMe: The average conversion rate for pop-ups is 3.09%, with the top 10% highest performing averaging a 9.28% conversion rate.
These ads appear when the user transitions between screens. For instance, if you enter your breakfast data in your calorie counter, you may get an add promoting healthy receipts.
Pros of transitional ads
- They get users at the moment they are in between tasks
- They keep the user engaged in the app.
Cons of transitional ads
- The ad needs to be relevant to the action being performed in the app
- If too promotional, it can annoy the user by being “too salesly”
Text ads can appear everywhere in the app. When the cursor hovers over a text or at any place in the app screen.
Pros of text ads
- They are unobtrusive
- They are easy to set up
- They can be anywhere.
Cons of text ads
- Be careful not to overuse them.
- They can be boring to the user.
A mobile screen is too small to fit a full size banner ad. However, you can be creative and use these ads strategically. Place it at the header or the footer, whichever it stays more visible to the user.
Pros of banner ads
- They stand out more than other types of ads
- Bigger visual impact
Cons of banner ads
- Can be too small to read the text inside
- Ensure the app screen allows the banner to be seen.
Adding a search feed to your app gives users a useful tool to improve their experience. In-app search ads allow your users to search from inside your app. The more active the users of your app, the more you generate ad revenue.
Pros of search feeds
- They are convenient
- Enhance the user experience
Cons of search feeds
- They are not fit for all types of apps
Best 5 Advertising Networks For Publishers
Choosing a network is one of the critical steps to ensure your success with in-app advertising. Here we did the hard work for you and listed the 5 best in-app advertising networks for publishers.
CodeFuel is a complete platform that allows you to monetize all your digital properties effectively. You can leverage search, ads, shopping, and news to monetize your app by using intent-based monetization.
This excellent ad platform is geared specifically with publishers in mind. There are over 1.1 k publishers with 9billion annual searches, so you’re sure your digital property will be monetized.
- Presents relevant display ads inside your app.
- You can add a search feed based on user intent that presents shopping ads
- Enhances the user experience.
- Increases conversions by keeping the user engaged.
- Integrates with Microsoft Bing, Google AdSense, and Yahoo.
- Performance tracking and analytics.
- CodeFuel also offers search mediation if you want to link to other networks.
CodeFuel is a versatile ad network that gives you the flexibility to monetize your app with search feeds and relevant display ads while enhancing the user experience. The platform presents ads offering multiple ad formats, including banner, interstitial and native ads.
AdMob is the mobile version of Google AdSense. AdMob includes ads automatically offering multiple ad formats, including banner, video, and interstitial ads.
- Multiple ad formats
- Ad mediation
- It is suitable for beginners and Google AdSense users
- However, it has limitations on ad placements.
- It is focused mostly (and logically) in Google products.
Smaato is a mobile ad platform for publishers and advertisers that focuses on matching publishers with relevant advertisers.
- Real-time bidding for ads auctions
- Allows video, interstitial, banner, interactive, and rewarded ads.
- Allows ad mediation.
The downside of Smaato is that it works only as an intermediary, for ads not dealing with user experience or search feeds.
Unity is a monetization network specifically for mobile games by using video ads. If your app is a game, Unity is your solution.
- Compatible with iOS and Android
- Compatible with all game engines including Marmalade and Adobe Air.
- You can set up in-app purchases.
- They support interstitial, video, or banner ads through CPM or CPI campaigns.
- Target demographics segmentation
- Almost real-time reporting.
MobFox is an independent mobile ad network for app monetization for publishers, app developers, and advertisers.
- Works with all advertising formats, like Unity, Cordova, AdobeAir, and GameMaker.
- You can target your audience by location, carrier, channel, and demographics.
- Allows for native, interstitial, banner, video, and rich media ads.
- Provides analytics and reports.
The downside: it seems focused on gaming monetization. It also doesn’t offer mediation or search feeds.
Why In-App Advertising Works better than Interruptive Advertising
Interruptive advertising is any type of advertising that gets in the way (interrupts) what a person is doing. It is very common, and you are most likely familiar with this type of advertising. Think about TV commercials and radio ads, for example.
While interruptive advertising has been around for a long time, it is not very effective for the digital world. When you interrupt the user, you “cut” their engagement with the app.
In-app ads are presented in the context of an app and tend to be more relevant, and therefore, more effective. Since the user is already engaged with the app, in-app advertising blends seamlessly with the user experience.
When you integrate the ad with the app experience, for example, by giving recommendations, the ad gives value instead of pushing a sale.
So, why should you use in-app advertising? Here are 3 reasons:
1. You can guide the user experience by mixing different in-app formats
When you use in-app advertising, ads are contextual and don’t look like ads, but like helpful suggestions. By doing so, you can enhance and guide the user’s journey. Mix ad formats, for example, video, interactive, and text, so it is more engaging for the user.
2. The user spends more time in-app
Engaged users spend more time using the app. Therefore, providing relevant and helpful in-app ads increases the possibilities of conversion.
3. You can target ads accurately
An ad network platform can help you segment and target ads according to different groups, locations, and demographics. This helps your ads stay relevant to the customer’s journey and intent.
Use In-App Advertising to Monetize More Effectively
When you put the right ads in the right context, it gives users an experience that is more relevant to their needs. As mentioned above, this increases CTR, engagement, and conversion rates.
The key to using in-app advertising for monetization is implementing the right monetization solution. This will get you an increase in ROI. How do you do it? Here are a few tips:
- Pick the right solution for your app. Not all ad networks are the same. Some solutions focus more on banners, others are more directed to gaming apps. Make sure the monetization solution offers ads that match your audience.
- When choosing the ad format, choose the most relevant and put them in front of the target audience within the app workflow. The less an ad seems like an ad, the better.
- Find a vendor that works for your business. Keep in mind which platforms do you display the app on and find a vendor that works with all of them.
Strategies for Mobile App Advertising
The right network and ad type need to align with your strategies for mobile app advertising. Here are a few pillar strategies to succeed:
It helps to blend the advertising with the app experience. This feature lets you offer value and advertising at the same time, preventing disengagement problems like banner blindness. Display ads can be tricky in mobile advertising and disconnect the user from the app. By contextualizing, you tie the ad to the app function.
Understand and Target the User Intent
What’s user intent? The term describes what is the user’s intention and purpose in using the app. For example, a user that downloads a taxi app is probably looking for rides.
A user playing a game wants to enhance their gaming experience, so you can offer in-app purchases. When you understand the user’s intent, you can target the advertising towards specifically this intent.
Improving the user experience and adding value
People use apps because they are looking to solve a problem with them. However, ads not always help with the purpose. Ads need to bring value and support the user experience. The more relevant and contextualized the ads, the higher the chances of converting.
Still, first, you need to promote your app so it can reach your target audience. How do you do it?
Getting the Word Out: Advertising an App
To get the word out in a saturated marketplace — remember they are over 3 billion apps only in the Google Playstore—, you need to be on target with your audience. To do that, start by asking the following questions:
Who are you advertising to?
Try to get as specific as possible with your audience. Chances are you already have a lot of information from when you created the app. Find out demographics, location, interests, and age group. The more you narrow the niche, the most effective your marketing.
For starters, you can work with the info you had to create your app. Once you begin advertising, you’ll get data through your ad network you can use to refine your campaigns. Learn what worked and what didn’t and re-target if necessary.
Where are they online?
If you are advertising an app, you need to reach your audience where they spend time online. Using the demographics and target audience profile you created on the last step, find out where your audience hangs out online.
- Create buyer personas and use this data to find out which social media channels they are more active on.
- Search on sites that cover your audience’s interests. Use social listening tools, search forums, or question-and-answer sites like Quora.
- Look at your competitors. Where are they promoting their apps? Chances are you have a similar audience.
- Survey your customers. Add a small survey after downloading, or in the middle of the app, workflow to check where your customers hang out online.
- Search Facebook Groups. Groups are a great source of information and offer you a ready-packed audience that is interested in what you offer.
How do you reach them?
Now that you know who is your audience and where they are, it is time to find the optimal way to reach them. You can promote your app via social media platform ads, through buying advertising space, or using an ad network.
You’ll want to find ad networks that target your audience where they spend time online. For instance, if your target is professionals, LinkedIn will be more effective than Facebook, if your target is young people, try Instagram or Tiktok.
Find the right advertising solution
You can be as creative as you need to get the word out about your app. Some innovative advertising methods include smart installers, pay-per-install solutions, and bundling. Affiliate marketing, for example, lets you recruit online marketers to promote your product.
Advertising an app is not an exact science, you need to measure and refine your campaign until you get results.
Cool and Unusual Ways to Advertise your App
In the age of social media, you want the app to get the most exposure possible. You want everybody to know about it and use it. Here are some out-of-the-box ideas to advertise your app.
Collaborate with Influencers
What is influencer marketing?
Influencer marketing is when companies partner with influencers in order to increase brand awareness or conversions among a specific target audience. (Bigcommerce)
According to a study, the ROI of influencer marketing can be 6 to 1, meaning for every $1 invested in influencer marketing, you can get $6.5 in return.
Partnering with an influencer can spread the voice of your app very quickly and on target. After all, almost half of the people look for an influencer recommendation before making a purchase.
Here are some tips to make the most of influencer marketing:
- Find an influencer that caters to your target audience.
- If your product is very specific, try a micro or medium influencer.
- Look for an influencer with great rapport and steady relations with followers.
Nowadays, most consumers are using social media platforms before deciding whether buy something. You should advertise in the channel where your customers are. Over half of apps are discovered outside the app store.
Here are some tips to promote your app on social media:
- Use paid ads on social media platforms.
- Encourage user-generated content
- Ask for reviews and ratings.
- Tease your audience and create anticipation with tweets.
A viral marketing campaign is designed to generate the most buzz around your app possible. The whole point is using the public as your medium to spread the word.
How do you generate the buzz? You can create a giveaway, a contest, or an event. You can use clever tweets, combined with a funny and memorable video in TikTok.
Provoke your audience, encouraging them to spread the word. A viral marketing campaign should be interesting enough that people would be compelled to share the video. Adding a freebie, for example, in exchange for shares can attract attention.
How to Optimize Your In-App Advertising Strategy in 10 Steps
In-app advertising helps brings a steady income, so you’ll want to do it right. The more effective your advertising, the more users will want to download and use your app. Below find some tips to monetize effectively with in-app advertising.
1. Put the User First
A user-centric approach in all your designs, from the user interface, to your website and ads, will help give a consistent user experience. Focus on giving a seamless user experience throughout all the elements that the user comes into contact with.
2. Test New Ad Formats
There are new ad formats appearing every once in a while. If it seems your current ad formatting is not working, mix it up. Test different formats to see which ones work better for your users, and increase conversion rates. Mix expandable ads, mobile video ads, recommendation engines, and interactive ads are some of the formats you can try.
3. Optimize What You Have
Sometimes you cannot go over budget for every new strategy. If you’ve hit the ceiling of what new trends you can try, optimize what you’ve got. Keep re-testing and improving your existing strategy.
4. Use a One-Stop Mobile Marketing Shop
You can be tempted into signing in to every ad network and monetization program under the sun to maximize your returns. However, this can result in spreading your efforts too much, first, and you’ll end analyzing data and ROI from a hundred sources.
Instead, sign up for a monetization and promotion platform. You can then manage all your analytics and monetization solutions under a centralized dashboard. A platform also integrates different ad networks giving you a unified solution.
5. Make Engagement a Priority
Downloading your app and using it are two different things. In-app advertising can work only if you got your user’s attention. Create a high-value app they want to use again and again. Then, integrate ads seamlessly into the app so they will stay engaged.
6. Focus on Usability If You Want Conversions
An app that is difficult to use can put off users after they download the app. When you design an app, remember:
Designing for conversion = Designing for Usability
The easiest to use is your app, the better the user satisfaction. Sometimes, flashy graphics and heavy downloads make the user experience cumbersome. Whatever the goal of your app, ensure that your user can achieve it seamlessly. The more usable interface, the longer people will use it.
7. Don’t Slow Things Down
Speaking about stalling user journeys, ensure your app is easy and fast to download. The same happens with ads. If your interstitial ads take too long to download and display, users may leave the app.
8. Add Incentives
You want ads that convert immediately, so you can add immediate incentives for action. You can include limited-time discounts, giveaways, or bargains, as a way to get users to act immediately.
Another way is to add in-app upgrades, tied with an affiliate offer, and it will likely jump your conversion rates. Or, add incentives for social sharing if you want to promote your app.
9. Add Strong Calls-to-Action
Sometimes you cannot design the ads that appear in your app. But if you do, include strong calls to action. Add triggers like “Act Now” or “Click here for your discount”. This can influence a user to complete an action, which will increase your conversions and revenue.
10. Understand Your Users
Understanding what your users want is the best way to give them a great user experience. Conduct user testing through surveys, A/B split testing, and interface optimization. The secret to a soaring monetization strategy is to find out what your users really need and give it to them as seamlessly as possible
Should You Use a Big Network or a Niche Solution?
When you try to monetize your app, finding the right network is critical. There are top companies you can use such as Microsoft, Google, and Facebook, that boast massive reach, but is it the right thing for your app?
Pros and Cons of Big Networks
Giant networks like Microsoft, Google, and Facebook offer a few benefits for developers that advertise with them.
- Massive reach: The main benefit is the large user base these companies have. For instance, Google’s AdMob reaches millions of users around the world.
- Cross-platform: Most big companies offer advertisers to present ads in-app, search results, social media, and other channels.
- User targeting: Facebook, for instance, draws from its social media data to target and optimize ads for users.
- Multiple types of Ads: Major platforms offer many types of ads, interstitial, display, and contextual ads.
- Lack of specialization: Major platforms reach everyone, which means they market to the masses. If you have a specific app for a defined niche, a big network cannot do the trick.
- Too much to chose from: Large networks offer a lot of options, sometimes, too much. This can be overwhelming for startups.
Pros and Cons of Niche Solutions
Niche solutions come in where large networks result impractical. You can still benefit from large user bases, but ensuring your app stays focused on your target audience. The goal is to reach the right users for your conversions to increase.
- Specialized Advertising Methods: Niche solutions give you the types of ads that the large companies are too big to deal with. For instance, marketing texts, recommendation engines, and video ads. If your niche is specific, then out-of-the-box ads may work better than generic ads from Google.
- Niche Audiences: Let’s say you want to reach software users of a certain platform. It would be better if you use an ad network that reaches the users of that platform. You can use pay-per-install programs since they are already installing software. Recommendation engines can deliver relevant ads to users that search for something specific.
- Innovation: Since niche networks are more nimble than large networks, they often dedicate resources to innovative creative approaches to monetization and advertising.
- Not suitable for everyone: There are, however, apps that do require massive generic reach, and a niche solution wouldn’t be enough.
Best Practices for a Successful In-app Advertising Strategy
Now that we covered the basics of in-app advertising, there are some best practices advertisers should consider:
In-App Advertising Formats
Maybe you are wondering which is the right ad format or a mix of them that will give you results. To do that, first, you need to understand how the different types of ads work. Here we explain the most popular types:
Source: Amazon appstore
Interstitial ads cover the entire mobile screen, generally at a size of 320 x 480 pixels. This size allows to display more content and the call to action becomes clearly visible. Other sizes include 300 x 400 or 300 x 250 pixels.
They are good to catch a user’s attention and to place in games in between levels, as they minimize the disruption for users. Beware of interrupting the user experience, so don’t push an interstitial ad in the middle of a game.
Video ads are increasingly popular, as they catch and retain the attention of the user when engaged with the device. However, if the video is intrusive, it may backfire. It’s important that the video ads are short (less than 30 seconds) and placed at natural breaks in the user experience.
Native ads can be of different forms and sizes, but what they have in common is that they are presented in a way that fits the publisher. Therefore, the ad blends with the app content.
They appear as part of the app’s content, thus are not intrusive or interrupt the user experience. The ad is relevant to the context of the app, making them highly effective.
This type of rich media ad, is a combination of a banner and an interstitial ad. It starts with a 320 x50 pixels banner as a teaser, then when the user taps on it, it displays in full screen. It has the advantage of being less intrusive than full-screen interstitial ads, but presenting too many can be annoying for the user.
Mobile Websites vs. Mobile Apps
Users access both apps and mobile websites via their mobile devices. Some companies wonder if is worth it to create an app, after all, they have a responsive mobile website. However, they are different things and the impact they have on the user is different too. Let’s examine the differences of mobile websites vs mobile apps.
How CodeFuel Can Help Monetize Your App
CodeFuel is a complete platform that leverages search, ads, shopping and news to monetize your application. It offers different types of ads and integrates with major search engines and networks for a complete solution. By adding user intent monetization, the platform ensures viewers get the most relevant ads in-app, enhancing conversions.
Are you ready to increase your app ROI? Learn more about how CodeFuel helps.