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Apps are big-league money makers for publishers. Revenue from mobile apps reached nearly $582 billion in 2020. By 2023, global app revenue is expected to top $935 billion.

With that kind of revenue potential, many publishers are eager to get in on mobile apps. In 2021, you have plenty of app revenue models to choose from, but one of the most popular and lucrative is in-app advertising.

To help you decide whether in-app ads are the right choice for your business, we have put together this guide to in-app advertising revenue generation.

Let’s get into it.

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Read Now: Take a deep dive into app monetization for publishers.

Types of In-App Ads

When you are trying to decide what kinds of ads you want to include in your app to drive revenue, you need to understand the available types. Of course, most publishers have two main goals: to earn the most money possible and preserve the user experience. With the right combination of ads, you can accomplish both goals.

There are several types of in-app ads to choose from:

  • Banner ads
  • Interstitial ads
  • Native ads
  • Gamified ads
  • Rewarded ads

Banner Ads

Banner ads typically sit alongside your content for the entire time the user is viewing the content. They appear as images, animated images and clickable assets and are used by advertisers that may want to drive brand awareness or produce a call to action. You can pick out the sizes that suit your app and complement your content. 

These ads look very much like traditional desktop web publishing ads. While they can be easier than some other mobile app ad types to implement, they also tend to offer the lowest CPMs.

Interstitial Ads

Welcome to full-screen takeover: interstitial ads happen between phases of an app user’s journey, appearing very differently than banner ads. In a mobile game, the user might, for example, complete a level of the game. And, before the next level loads for the user, a full-screen interstitial ad appears, motivating the user to engage with the ad in the game’s absence. 

Interstitial ads can be text, images or video. Using videos in this format can help generate great CPMs. In fact, video ads usually offer some of the highest available CPMs for app publishers.

Native Ads

These are ads that look like a natural part of the app and provide little interruption to the user’s experience. While they may be marked as ads, their look and feel are very much like the rest of the content inside the app.

Gamified Ads

What’s more engaging than a video game? Almost nothing. That’s why gamified ads have become so popular in mobile apps. These ads, which yield the highest in-app ad CPMs for publishers, present the user with a game to complete within the ad.

It could be as simple as M&M’s viral Eye-Spy Pretzel game or as complex as a platform scroller game — but it has to be custom. You won’t be able to sell gamified ad inventory programmatically. These are direct-sell ads, which is part of why they generate such high CPMs.

Rewarded Ads

With rewarded ads, you incentivize ad views by giving perks or bonuses after the app has launched. The reward could be in-app currency, coupons, more lives in a mobile game or anything that has value to the user. 

Rewarded ads come up in cases where the user's experience is fully interrupted. The user knows ahead of time that they will get something in exchange for viewing (e.g., when playing a game, a rewarded ad may provide the user extra lives in exchange for watching a video ad).

How to Pick the Right Ad Format for Your App

You know the types of in-app ads. But how do you decide which one is right for your app?

This is a tough decision that many publishers have to make. It’s all about looking at your app and understanding where you can feasibly place ads that will be effective and preserve the user’s experience. 

Is your app a first-person shooter with levels? Perhaps you would want to go with interstitial video ads between levels. Have a chess or board game app that maintains a continuous screen throughout? Banner ads beside the content might work nicely. Does your app offer lives, levels or in-game currency? Rewarded ads could be the right fit.

Here’s the point: In-app advertising revenue generation is not one-size-fits-all. It’s unique to your app and your preferences. A good mobile app advertising partner will walk through your app with you to look for ad opportunities that could work well for you. 

But at the end of the day, it’s about what you feel comfortable with. The process of adding ads to your app should be collaborative and leave you with a full picture of the revenue potential for each iteration of your strategy.

Challenges of In-App Advertising

Publishers who are new to in-app advertising often face some obstacles as they try to bring in revenue. That’s because it’s a lot harder to get started with in-app ads than with ads on your website.

On your website, you can make changes and see them live in real time to make sure they work. You can change up your ad inventory layout and offerings with little effort. 

But in a mobile app, you face some unique challenges as you try to implement or change your ad strategy:

  • You have to ensure that all of the software development kits (SDKs) you and your ad partners are using work together. 
  • You have to make changes to your app in a testing environment.
  • Then, you have to resubmit your app to the major app stores for approval.

After you have resubmitted your app and gotten it approved, you then can see whether your changes were effective. If this sounds inefficient, that’s because it is. It takes a lot longer to get mobile app ads up and running and a lot longer to make changes to them.

Working with Mediation Partners for In-App Ad Revenue Generation

The above challenges are a big part of the reason why many publishers work with ad mediation partners.

Ad mediation is an app monetization solution that allows developers and publishers to handle multiple ad networks through a single SDK. If consolidation of revenue reporting and engagement metrics on a single dashboard is important to you, you’ll also be pleased to discover that these monetization efforts can be quickly scaled.  

When a mobile ad mediator manages the available ad space from your app, it will automatically send your supply to every network you are working with for you. Mediation partners are another way to tap into more advertising demand.

Your Partner in In-App Ad Revenue Generation

Generating revenue from in-app advertising can be confusing — even overwhelming — for publishers who would much rather spend their valuable time creating world-class content. 

At Playwire, we understand that. That’s why we have built our platform to be the easiest way for publishers to boost app revenue. From header bidding mediation to direct ad sales, we can solve your in-app advertising problems and boost your revenue. To work with us, call 1-561-206-4621 or contact us online.