Our guest writer Valentine Cem Aseyo is the SVP of Product at Bandsintown, the #1 concert discovery platform that connects 40 million fans with their 450 thousand musicians. Valentine has a very unique background: before Bandsintown, he spent 8 years working at Facebook in Ireland, India, and US spanning many roles from User Experience to Advertising Products, to Marketing & Sales, which made Valentine an international Tech Expert and Innovator. Prior to that, he worked at IBM and Colgate & Palmolive. Valentine has built many products, apps, and services throughout his career: B2C, B2B, internal products, advertising solutions, and more. He’s always interested in sharing his best practices and contributing back to the growth of Product Managers.
Congratulations on building a state of the art mobile app! Most probably, you’re now scratching your head to figure out how to make some money out of it. Don’t you fret, it’s actually simpler than you think. Here’s a crash course on the most common ways to monetize your mobile app.
1: Classics don’t die: email, push, sms
I understand the desire to innovate. You want fireworks, bells and whistles. You built an awesome app and you would like your monetization strategy to be on par with it. However, there’s nothing wrong with starting simple and tapping into more traditional monetization techniques in the beginning. I can’t say this will be a sustainable way for you to generate enough revenue in the long-term but it’s certainly a good way to start.
Make sure to collect some basic information (e.g. age, gender, etc.) during sign up so that you can have additional targeting capabilities on top of your internal data. Once you have a decent size of user base, this will give you the ability to run email, push, sms marketing campaigns for your partners. The key here is creating an alignment between the core topic of your app and the product/service being advertised. For example, if you have a music app, then it’s fair to send them emails on music-related products, services, events, etc.
2: Unlock the power of the content
No matter what your app is about, content will give you the keys to the kingdom. If you are a gaming app, then have content for game lovers. If you are a music app, then there’s an ocean of music news. Once you have a content platform/tab within your app, you can create paid editorial content partnering with brands that are aligned with your subject. Depending on your user base and active users, these may bring you the highest revenue since you set the price yourself.
3: To sponsor or not to sponsor; that’s the question
No matter what product or service they provide, brands constantly look for highly targeted and focused audiences to advertise because this is the best way to reach their core customers and increase the return on ad spend. Determine your niche audience. How do you differentiate yourself from other apps or social media? What’s so special about your user base? This will be the base of your value preposition.
If you’re a running app, that means your audience loves running and most probably, they are regular or competitive runners. For a sports shoe brand, your app is the best place to acquire potential customers. Your app is far more suitable to run their ads than any other app out there. No matter what your app is about, you’ll have a product category that matches your audience. The key is to identify the uniqueness of your audience and outline the list of products/services that speak to these people. Once you distinguish these two things, you got the upper hand in your conversations with advertisers and you’ll have the opportunity to set a higher price.
4: Ad networks to your rescue!
If you don’t have the resources (time, budget, manpower) to build in-app ad units or you don’t have the means to generate demand, then ad networks come to your rescue. There are many options such as Facebook Audience Network, Google AdMob, Mopub, etc. Essentially, you’re leasing the real estate within your app to people who can provide impressions for you. Unfortunately, it’s a competitive area with high supply so the profitability is rather low. Be very careful about the ad quality as these networks are bound to have lower quality ads that may appear to be spammy to users.
5: Do it yourself: native ads
If you have the resources and the client base to generate demand for your supply, building your own ad units may be an option. It goes without saying that you have to have enough impressions for these ads to be profitable. Otherwise, you’ll spend a lot of time and money on ad units that won’t get the eyeballs they need. Here are typical examples of in-app ad units:
Display ads: ideally, these ad units would be placed in idle spaces within your app. For example, you have a tab where the content is at the top and there isn’t anything to scroll down for — it may be a good idea to fill that blank space with an ad unit.
Banner ads: these are usually found at the top or bottom of the screen and can be somewhat distracting than other forms. They can also irritate your users, so think twice before agreeing to incorporate one into your app. It’s always a good idea to put an “X” icon at the top right of these units so that people can close them if they’d like to get rid of it.
Interstitial ads: these are full screen ads and usually placed at natural pause points, like when moving between menus. These are very tricky because if they’re not placed correctly, it may ruin the user experience. Make sure the user’s actions is not interrupted by these invasive screens in the middle of a flow. Place them in the beginning or the end of a flow. For example, you can show a quick interstitial when app opens, or you can show it once an action is completed such as achievement unlocked, item purchased, etc.
Capture forms: these offer incentives (e.g. points, tokens, coupons, etc.) for users who enter their personal information such as email addresses. You’ll most often find capture forms in mobile games or e-commerce apps.
Notification ads: These pop up in the mobile device’s status bar and make users more aware of the ad’s presence. Be warned, these aren’t the most well-loved ads out there, and could damage your app’s reputation.