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Mobile Marketing

Top 5 Reasons Mobile Developers Fail to Monetize

Guest Blogger  //  December 6, 2013  //  5 min read

Calculating Your App Revenue is essential to app monetization

Developers are constantly looking for ways to increase revenue streams and turn a profit on their apps. There are only have a few options that are really viable, but most are rarely profitable. In fact, 59% of developers don’t even make enough money to recoup the original costs of developing an app. If you have developed a great app that’s providing lackluster results, these five reasons are the likely culprits.

 1. Lack of a Monetization Strategy

Many developers start creating an app without having a monetization strategy. They know they will have some ads and maybe make it a premium app, but that’s about it. Their main focus is on the actual product, which is good. However, apps that are designed with monetization in mind tend to do a lot better. Perhaps ad space is worked into the design, such as interstitial ads or special ad areas. However, if a monetization campaign isn’t integrated into an app so that it fits seamlessly with the user’s experience, it can be less effective. If you’ve created an app that wasn’t optimized ahead of time, there are some options to consider.

First and foremost, there is Poll To Pay. It works as long as there is some available paid content in your app. You just need to integrate the SDK and place a “Poll” button somewhere visible. This allows customers to take a poll in exchange for the paid content, and Poll To Pay will pay you for the content that was given to the customers. People are more likely to part with their time instead of money making this strategy more effective than many ad campaigns.

Second, you can use sponsorships. This is similar to ad-supported monetization, however, it works much better with apps that weren’t originally designed for ads and places more control in the hands of the developer. This is because each advertisement can be custom designed for your app, tailoring the experience specifically for your audience. The idea of sponsorship is to find individual businesses or events to advertise on your app. It works best with industry specific apps that are related to your mobile application. This often results in a higher eCPM because of the contented is related to the app.

2. Not asking for help

Publishers and developers often overlook simply asking their monetization platform for help. The goal of these platforms is to make money, and in return, make you money. Chances are, they have had developers with the same challenges as you, and they know how to help. This can include:

  • Deciding on the right ad format
  • Choosing ad placement
  • Understanding and improving eCPMs
  • SDK challenges

They have access to a lot more research, experts, and experience in monetizing apps and can offer great advice for your specific app. Don’t be afraid to reach out to them, even if you don’t have a problem but just want to monetize smarter.

3. Misunderstanding eCPM

A popular way to judge the effectiveness for an ad campaign is by paying attention to eCPMs or Effective Cost per Mille. This is the ad revenue made per 1,000 impressions. In order to calculate this, follow this simple equation to find out how well your app is monetizing:

How to calculate mobile app advertising eCPM ad monetization

This is a great way to compare ad campaigns and services. However, this is a tricky metric and should  be seen as a tool and not as the sole way to measure monetization success. Many times the eCPM doesn’t tell the whole story.

For example:

Advertiser “A” gets 10,000,000 impressions in a week. You earn $10,000 which gives you an eCPM of $1.

Advertiser “B” only had 1,000 impressions and paid you $2.50. This means the eCPM was much more for “B” at $2.50.

This makes it so that Advertiser “B” has a higher eCPM and so it seems to be a better place to build up your inventory, where in reality the revenue from advertiser “A” was much better.

4. Maintaining Identical iOS and Android Apps

In order to be successful in the app world, it is almost always necessary to have iOS and Android platforms for your app. However, maintaing identical iOS and Android ad campaigns is a problem a lot of app developers have. These platforms have very different technology, and what works for one operating system might not work on the other. For example, iOS doesn’t allow Notification Push ads on many ad networks, so advertising campaigns have to adjust for this.

The demographics and habits of the customer bases for the iOS and Android are also very different, and can dictate what works best. For example, highly social interstitial ads may work on iOS, whereas simple call to actions on a loading screen may work better for Android. This is always evolving so testing many different options for ad services, ad models, and monetization options are crucial to find out what works for each operating system.

5. Failing to Integrate Ads

When it comes to ad space in an app, things can literally get ugly. It is a shame because designers work so hard to make an app beautiful, right down to the spacing of your font. Mobile ads can really stick out like a sore thumb and this hurts monetization. However, in a CPI model, publishers can help correct this by creatively optimizing ad placement with many services such as AppFlood, MobileCore, or Appnext .

Many ad services allow publishers to create their own banners, buttons, and items to seamlessly fit into the user interface. This looks better and you can make an advertising menu button for customers to see other apps they might like, which will feel as though it is part of the app and not an annoying ad.

These 5 areas are important to focus on when you are questioning your own monetization strategy. Always improve your product, but take a closer look at your monetization plan and don’t fall into one of these traps. If you have other insights into what holds apps back from monetizing successfully please share below.

About the author:
Elliott Morrow is a blogger and writer from San Francisco. He relocated to Russia to participate in the growing tech scene, to assist fellow bloggers, and to battle bears on the weekends.

The Math of the App Business Guide

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