How to Make Money from Apps - App Monetization Models

Mobile applications have become an integral part of our daily routines, serving diverse functions ranging from practical tools to sources of entertainment and gateways to information. 

However, for businesses, these apps have also evolved into potent avenues for generating revenue. 

In this comprehensive guide, we will delve into the realm of app monetization and explore the multitude of strategies available to companies.

The Modern App Landscape – Diversity and More

Because today’s business landscape is different from yesterday, businesses have found new ways to add to their revenue. Diversity is the cornerstone of any business’s success. 

Companies have shifted away from relying solely on a single revenue stream and are actively exploring multiple avenues to profit and monetize their apps. 

This shift allows businesses to tailor their approach to match their unique offerings and cater to their specific target audiences. However, no matter what, proper planning of everything is important.

The Importance of Planning

Effective app monetization doesn’t happen by chance; it requires careful planning and consideration of various factors. 

While conducting your research is crucial, seeking guidance from experts like ESP Inspire can provide valuable insights. 

With their experience and knowledge, they can help you navigate the complexities of app monetization successfully.

Key Considerations Before Embarking on App Development

Before diving into app design and development, several essential factors merit consideration. Here are some key aspects to keep in mind:

App’s Purpose

To know how to monetize your app effectively, you must first understand its core purpose. This clarity sets the foundation for your monetization strategy. 

To gain clarity, ask yourself these questions:

  • What issue does your app address?
  • What kind of software development services are necessary for building a successful app?
  • How might your app’s monetization impact the market?
  • How will your app benefit and serve your customers and their needs?

Once you have clear answers about your app’s purpose, you can select the right way to make money from it, like using subscription models for services and content-based apps.

Target Audience

The potential for your app to generate revenue is intricately tied to your target audience. It’s crucial to comprehend your users’ needs, preferences, and willingness to invest in your app’s offerings.

Competitive Analysis

Conducting a competitive analysis is vital when devising your app’s monetization strategy. Understanding the strategies employed by similar apps in the market and their profitability can guide your decision-making.

Technology Choices

The technology stack you choose for your app not only affects user experience but also influences your earnings potential. For instance, blockchain-based models may offer higher profit margins compared to traditional approaches.

How to Make Money from Apps – App Monetization Models

Now, let’s delve deeper into the various revenue streams available for mobile apps:

How to Make Money from Apps - App Monetization Models

In-App Advertising

In-app advertising is a versatile and widely used monetization strategy. It encompasses various ad formats, including:

  • Banner Ads: These unobtrusive ads are typically displayed at the top or bottom of the app screen, offering a steady income stream based on the number of ad impressions.
  • Interstitials: Full-screen ads that appear at natural breaks in the app’s flow, such as between game levels or while transitioning between screens. They often yield higher payouts due to their larger size.
  • Rewarded Video Ads: These ads offer users a reward, such as in-game currency or additional content, in exchange for watching a video ad. They effectively engage users and can generate substantial revenue.

Successful in-app advertising is based on having a balance between user experience and placement of the ad. The ad must not disturb the app functionality.

In-App Purchases (IAPs)

Freemium apps frequently turn to in-app purchases as their preferred avenue for revenue enhancement. IAPs can be further explored through:

  • Unlocking Premium Features: Beyond gaming apps, other app categories can employ this strategy. For instance, a photo editing app might offer basic filters for free while charging for advanced ones.
  • Virtual Goods: Games often sell virtual currency, skins, or items that enhance gameplay. Users are willing to pay for items that provide a competitive edge or enhance their enjoyment.
  • Subscriptions: Some apps offer subscription models, allowing users to access premium content or features on a recurring basis.

Effectively handling in-app purchases means ensuring users find value without being pushed to spend. It’s all about finding that sweet spot where users are happy to make purchases.


Subscription-based monetization is prevalent among apps that provide ongoing content or services. It can be expanded upon through:

  • Streaming Services: Music and video streaming apps like Spotify and Netflix offer monthly subscription plans for ad-free, premium content access.
  • News and Magazine Apps: These apps provide subscribers with exclusive articles, ad-free reading experiences, and the latest news updates.
  • Fitness and Productivity Apps: Apps in this category often offer premium subscriptions for advanced features and personalized workout or productivity plans.

Subscription models foster a steady income stream and promote user loyalty through regular content updates and enhanced experiences.

Selling Merchandise

eCommerce apps can diversify their revenue streams by selling products or services within the app. This can include:

  • Online Stores: Retailers can create a mobile app extension of their online store, making it convenient for users to shop on mobile devices.
  • Exclusive In-App Deals: Offering exclusive discounts or limited-time offers within the app can encourage users to make purchases.
  • Sponsored Products: Partnering with other brands to showcase their products within your app can generate additional revenue through commissions.

eCommerce apps should prioritize providing a seamless shopping experience and excellent customer support to boost sales.

Affiliate Marketing

Apps can engage in affiliate marketing by promoting products or services and earning commissions for successful referrals. Key considerations include:

  • Selecting Affiliate Programs: Choose affiliate programs that align with your app’s niche and target audience.
  • Effective Promotion: Craft compelling content and promotions to encourage users to click on affiliate links and make purchases.
  • Tracking and Analytics: Implement tracking mechanisms to monitor affiliate link performance and optimize strategies.

Affiliate marketing can be lucrative when executed strategically and provides a way to monetize without relying directly on user purchases within the app.

By exploring these revenue streams in-depth and tailoring them to your app’s unique offerings and audience, you can maximize your app’s earning potential. 

Remember that successful monetization often involves a combination of these strategies and a deep understanding of your users’ preferences and needs.

How Much Money Do Apps Make Per Download

Generally, it could be anywhere between $0.06 and $1.20. The amount of money generated per download varies. It depends on factors like the kind of apps, frequency of usage, and the number of clicks on the advertisements displayed in the app. 

Choosing the Right App Monetization Method

Choosing the Right App Monetization Method

Finding the most suitable method to monetize your app is a key factor in your business’s success.

Building a Path to Monetization

Start by identifying your target audience and creating a pathway to convert your app’s traffic into revenue. 

For instance, if you have a language learning app, begin with engaging features like fun games, mini-challenges, and daily quizzes. As users become more involved, gradually introduce more advanced and monetized features.

Choosing the Right Platforms

Collaborate with an experienced mobile app development company to determine which platform suits your app best. 

Factor in the costs associated with Android app development and iOS app development. In many cases, businesses opt for both platforms to reach a wider audience.

Leveraging Native Extensions

Consider extending your app’s functionality over time. For instance, you can add new levels to your gaming app or introduce more advanced lessons in your learning app. 

This method allows you to provide a no-cost version of your app while earning revenue via in-app purchases or premium feature subscriptions.

Factoring in Local Influences on Pricing

When determining your pricing framework for in-app purchases, subscriptions, or funding, consider local elements that can profoundly influence your app’s earnings. 

Take into account disparities in living costs, rivalry from other apps, and the pricing strategies of nearby competitors.

Analyzing User Statistics

To make your chosen monetization model successful, analyzing user statistics and app metrics is essential. Gain insights into your users’ purchasing habits, average revenue generated per user, the ratio of new to returning customers, and more. This data empowers you to make informed decisions and ensure a positive user experience.

Keep in view that the way you make profits from your app can influence users’ sentiments when they interact with it. Therefore, ensuring user happiness is vital for its ongoing success.

How to Make Money from Free Apps

Imagine you have an exceptional free app, and you’re wondering, “How can I generate income from it?” This comprehensive guide will break down various strategies as if we’re in a classroom:


Think of sponsorship as having a friendly partner supporting your app, similar to a sports team having a sponsor. Here’s how it works:

  • Companies pay you to feature their products or services within your app.
  • You promote these products or services, and in return, you earn money.
  • Users access your app for free, and you receive payments from sponsors.

How to Do It

  • Identify potential sponsors aligned with your app’s niche or target audience.
  • Reach out to these companies to propose a partnership.
  • Discuss sponsorship terms, including the content or products they want to feature in your app.
  • Implement sponsored content or products within your app, ensuring seamless integration.

In-App Purchases

In-app purchases are akin to opening a store within your app. Imagine you have a game, and players can buy cool outfits or extra lives. Here’s the breakdown:

  • Users download your app for free.
  • They can enjoy basic features without payment.
  • However, they can purchase extra goodies or features within the app.
  • You earn money when users make these purchases.

How to Do It

  • Identify in-app items or features that users would value as purchases.
  • Implement a secure and user-friendly payment system within your app.
  • Clearly communicate the benefits of these purchases to users.
  • Monitor user engagement and adjust in-app purchases based on user preferences and feedback.

Freemium Apps

Think of freemium apps as a trial period. You deliver a free app version with features limited, and users can unlock the entire experience through a payment if they find it satisfactory. 

Here’s the way it functions:

  • Users get to try your app for free and discover its value.
  • To access premium features or remove ads, they make a payment.
  • It’s like a trial that leads to a premium experience.

How to Do It

  • Identify premium features or content that users would be willing to pay for.
  • Offer a free version of your app with limited access to these features.
  • Implement a seamless upgrade process for users to unlock premium content.
  • Use notifications and prompts strategically to encourage users to consider upgrading.

Affiliate Marketing

Think of affiliate marketing as being a matchmaker. You familiarize your app users with products or services, and you earn a commission upon their purchase. Here’s the process:

  • You partner with companies or brands.
  • You promote their products or services within your app.
  • When users click on those promotions and make purchases, you get a percentage of the sale.

How to Do It

  • Research and select affiliate programs or products relevant to your app’s niche.
  • Create compelling content or placements within your app to promote affiliate products.
  • Ensure that affiliate links are properly tracked to attribute sales to your app.
  • Regularly analyze the performance of affiliate marketing campaigns and refine your strategies.

In-App Advertising

In-app advertising is akin to renting space within your app for ads. Companies pay you to display their ads to your users. Here’s how it works:

  • Advertisers want to reach your app’s audience.
  • You provide space within your app for their ads.
  • When users engage with these ads, you earn money.

How to Do It

  • Explore advertising networks or platforms compatible with your app.
  • Implement ad spaces or banners within your app’s interface.
  • Ensure that ads are relevant to your audience to maximize engagement.
  • Monitor ad performance and optimize placements for improved revenue.

Remember that the method you select to earn money from your app has its own benefits and drawbacks. 

For instance, if your app caters to gamers, in-app purchases could be an effective choice, but for a news app, advertising or subscriptions might be more fitting. Therefore, weigh your app’s user demographics and revenue goals when deciding.

Scope of Making Money from Apps for Companies – A 2024 Perspective

As we venture into 2024, the landscape for making money from apps continues to evolve, offering exciting opportunities for companies. Let’s explore the scope of app monetization in this new year.

Diverse Monetization Models

Companies have several monetization models to choose from – from in-app advertising and in-app purchases to subscription-based services and affiliate marketing. The diversity allows companies to tailor their approach to match their app’s nature and audience.

Targeted Advertising

In 2024, the advertising landscape within apps becomes more sophisticated. Companies can use user data and AI to offer highly targeted ads. This not only enhances the user experience but also increases ad revenue.

Subscription Services

The subscription model gains even more prominence, especially in content-heavy apps like streaming services, news publications, and productivity tools. Companies can offer premium content or features on a recurring basis, ensuring a steady income stream.

Microtransactions and In-App Purchases

Companies are discovering the potential of microtransactions within their apps. Users are more willing to make small, frequent purchases, such as virtual goods or add-ons. This microtransaction model can be a lucrative source of revenue.

Emerging Technologies

In 2024, emerging technologies like augmented reality (AR) and virtual reality (VR) offer new avenues for app monetization. Companies can develop immersive experiences and charge for premium AR/VR content or services.

Localization and Global Expansion

Companies can tap into the global market by localizing their apps and considering regional pricing strategies. Recognizing local factors, like income levels and competitor pricing, can significantly impact revenue.

Enhanced User Analytics

Advanced user analytics tools provide companies with deeper insights into user behavior. Companies can leverage these insights to refine their monetization strategies, making data-driven decisions for better results.

User Engagement and Retention

Companies understand the importance of keeping users engaged and retaining them. Effective engagement strategies, combined with a strong focus on user satisfaction, lead to higher user retention and, consequently, increased monetization opportunities.

Ethical Monetization

Companies are increasingly conscious of ethical monetization practices. Striking a balance between revenue generation and user well-being is crucial. Transparent and ethical monetization methods build trust and loyalty among users.

Competition and Innovation

The app market remains highly competitive, driving companies to innovate continually. Staying ahead often requires creative approaches to monetization, user-centric design, and constant adaptation to industry trends.

In 2024, the scope for companies to make money from apps is vast and dynamic. Success lies in understanding user preferences, embracing innovation, and adopting monetization strategies that align with both business goals and user satisfaction. 

Companies that navigate this landscape wisely are poised for significant growth in the world of app monetization. ESP Inspire is a professional mobile app developer company. We help businesses like yours, design and develop optimized apps.

These apps help them generate more income and invest in their business’s success. Hire app developer now!

How Much Money Can You Earn Through An App?

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