An average person spends nearly 5 hours on their phone every day, and 89% of that time is spent on scrolling through mobile apps to make purchases, read news, and browse through content.
Mobile apps have become an ideal environment that fosters great potential for revenue growth. However, this is a completely different landscape compared to web publishing.
This guide explains the key differences between in-app monetization and web monetization, and outlines practical strategies app publishers can use to maximize revenue without sacrificing user experience.
What is in-app monetization?
In-app monetization refers to the methods app publishers use to generate revenue from users within a mobile application. This can include advertising, subscriptions, in-app purchases, or hybrid models that combine multiple revenue streams.
Unlike web monetization, in-app monetization operates within closed ecosystems such as iOS and Android, which introduces unique technical, measurement, and user experience challenges.
In-app monetization vs Web monetization: Key differences
User environment and technical control
Web monetization takes place in open browser environments where publishers have more flexibility over ad placement, tracking, and integrations. In contrast, in-app monetization is governed by operating system rules, app store policies, and SDK-based integrations.
For app publishers, this means they have:
- Less control over tracking compared to web
- Greater dependence on SDK performance and compatibility
- Stricter compliance requirements, especially around privacy
User behavior and engagement
App users also demonstrate distinct behavioral patterns compared to web users.
They typically spend more time within each session and return to the app more frequently. At the same time, their expectations are higher, especially when it comes to smoother performance and faster load times.
As a result, aggressive ad strategies can quickly lead to uninstalls or negative app reviews in an app environment.
Ad formats and inventory structures
Web monetization typically relies on display banners, native placements, and video units embedded within pages. In-app monetization, however, centers around formats designed for full-screen and immersive experiences. A few examples include:
- Rewarded video
- Interstitial ads
- Native in-feed ads
- App open ads
These formats often deliver higher eCPMs than web display ads, but only when implemented carefully and thoughtfully.
Interested in exploring more ad formats and see which one matches your needs? Contact us via: gi-marketing@geniee.co.jp
Measurement and attribution
Web monetization has traditionally relied on cookies, browser-based tracking, and well-established attribution models to understand user behavior and measure performance.
Meanwhile, app publishers measure and understand app monetization through analytics SDKs, attribution platforms, and mediation tools that track revenue metrics like ARPU, LTV, and eCPM. These replace traditional web methods by focusing on mobile-specific events such as installs, in-app purchases, and ad impressions.
Which are the most well known models for in-app monetization?
The most popular approaches are in-app advertising and in-app purchases, with the recent introduction and growing popularity of hybrid in-app monetization. With these models, app publishers can offer free access to drive user scale before proceeding to generate income through ads, recurring payments, or optional upgrades.
What is in-app advertising?
With in-app advertising, publishers display advertisements in their app products to generate yields. Commonly chosen formats include banners, interstitials, rewarded videos, or native ads. This approach best suits high-volume free apps because it can achieve scalable and sustainable revenue growth without substantial upfront cost.
What is in-app purchase?
Commonly used in gaming apps, this approach allows users to buy virtual goods, currencies, or features. Thanks to these buyable privileges, this method is highly scalable and can bring significant yield growth. However, publishers can risk facing backlash and user loss if monetization is done too radically to the point of being perceived as pay-to-win.
What is hybrid in-app monetization?
Hybrid in-app monetization combines multiple revenue streams like ads, subscriptions, and in-app purchases within a single app to diversify income and capture value from varied user behaviors.
With this approach, app publishers can reduce reliance on one single method and customize their monetizing approaches by combining the advantages of multiple models.
Proven success factors for in-app monetization
Ensuring monetization strategies are experience-first
Retention is a core driver of in-app monetization success. Therefore, ads that interrupt key user actions, slow down app performance, or feel overly intrusive can reduce lifetime value and negatively impact long-term revenue, even if they deliver short-term gains.
As a result, app publishers achieve better results when ad experiences are designed to fit naturally within the user journey. Limiting excessive interstitial frequency, using rewarded ads with a clear and transparent value exchange, and testing placements across different user segments all help ensure monetization support while enhancing the overall app experience.
Optimizing ad mediation and demand sources
In-app monetization relies heavily on mediation platforms to manage multiple demand sources efficiently. Unlike web monetization, where publishers often have more direct control, mobile app monetization requires continuous oversight of mediation setups.
Therefore, it is important to regularly optimize waterfalls or bidding configurations, adjust floor prices, and evaluate ad network performance. These practices help maintain competitive eCPMs and ensure inventory is allocated to the highest-performing demand partners.
Leveraging contextual and first-party data
Contextual insights and first-party data are critical insights that enable effective in-app monetization. App context, such as content type and session behavior, combined with first-party signals like engagement levels and usage patterns, provides valuable guidance for ad delivery.
Testing, measuring, and improving
Similarly to web monetization, In-app monetization is not a static setup but an ongoing optimization process. Continuous testing of ad frequency, format mix, placement timing, and overall impact on user flow enables publishers to respond to changes in user behavior and performance trends. Even small, data-driven adjustments can result in meaningful improvements in both revenue generation and user retention over time.
Conclusion
In-app monetization is fundamentally different from web monetization in terms of technology, user behavior, and revenue mechanics. While apps offer higher engagement and premium ad formats, they also require greater care around user experience and performance.
For app publishers, the path to sustainable growth lies in understanding these differences, choosing the right monetization mix, and continuously optimizing with both revenue and retention in mind. When executed correctly, in-app monetization can become a powerful and scalable revenue engine.
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