3 ways to boost your mobile ad monetization strategy
We’ve all been there – you read about a new app online, go to download it, and once you realize that you need to pay upfront, you close the page never to return. This is a situation that no developer wants to encounter – and why many companies decide to offer their apps for free. However, even if you have millions of users for your app, you still need a strong strategy in place to see a meaningful monetary return.
According to a study conducted by CivicScience, 71 percent of respondents said they have not and would not consider paying for an app, nor would they consider making an in-app purchase. While this number is surprisingly large, it is important to take a deeper look into the data and understand where the market is going. According to App Annie, the app economy is expected to double in size to $101 billion by 2020, and if we segment out the CivicScience data, it shows that the younger demographic is more receptive to opening up their wallets for an app. Over 40 percent of the respondents willing to pay for an app or in-app purchase were Millennials.
Depending on the demographics an app is looking to reach, paid apps and in-app purchases may have a place in an overall ad monetization strategy; however, the benefits of advertising should not be overlooked. While mobile advertising was once considered a gamble, it’s now becoming a preferred method for advertising. According to ZenithOptimedia, “mobile will overtake desktop to become the primary Internet advertising medium in 2017, a year earlier than previously forecast.”
Thinking about adding ads to your app? Here are a few ideas to get you started and make sure you’re optimizing your ROI:
1.Look to native advertising
Alok Goel, managing director at SAIF Partners, recently attended DU Ad Platform’s inaugural developer event in Bangalore and was quoted as saying, “The boundary between the ad world and the transactional world is fading away. Native advertising is the next big thing.” Goel’s comments are backed up by a recent IHS Technology study that was commissioned by Facebook's Audience Network. The research found that 63 percent of all mobile display ads will be native by 2020 – and for good reason. Some of the benefits of native ads compared to standard banner ads include more engagement, less user churn and ad fatigue, and higher retention rates.
2.Be mindful of ad placement
It is important to maintain the soul of an app – its “feel”. Poor placement of ads can have a negative impact on customer experience. Ads should not interfere with the use of an app – because if they do, there’s an increased risk of alienating loyal users. However, there are certain formats that can boost ROI while reducing consumer concerns. According to a recent study by the Interactive Advertising Bureau, a “scroller,” which is a native ad format that appears as a full-screen window as consumers scroll down on a web page, are seen as less invasive by the consumer because they can scroll right past them. Another added benefit is that it reduces the amount of clutter on the screen because there’s only one ad showing at a time.
3.Provide the right ads for your audience
Just as ad placement is a critical aspect to consider when adding advertisements to an app, showing ads that are relevant to a target audience is another way to create a better experience for the user. Including ads that are aligned with the interests of an app’s core audience will likely leave the audience more engaged and advertisers more satisfied with the return. In order to make this a reality, a developer must have access to the right data to fully understand their audience, as well as what types of ads they will be most amenable to.
As mobile continues to dominate the way people interact and stay connected, advertisers will increasingly look to apps as a major platform for reaching potential consumers. The key is for developers to establish a customized monetization plan by doing their research, looking to see what has worked in the past, and continuing to tweak the plan after implementation.