Mobile App Monetization Strategies: Maximize Revenue in 2025

So, you’ve built the next app sensation. It’s intuitive, it’s engaging, and packed with features to attract users. Now, it’s time to figure out how to monetize an app.

Putting a price tag on the app itself is likely a no-go. According to a Statista report, 97% of Android apps and 95.37% of iOS apps are free. In the app market saturated with free offers, most users won’t be ready for paid app downloads unless they see the immediate value of the purchase. 

Other, more effective ways to earn from your app exist. 

In-app purchases, in-app advertising, subscriptions, freemium, or hybrid models – let’s review the most effective mobile app monetization strategies and see which one might be the perfect fit for your app. 

How to Monetize an App? 6 Proven App Monetization Models

1. In-App Advertising

In-app advertising has become one of the most effective and lucrative forms of monetization for apps, with global mobile ad spend set to hit a whopping $390 billion in 2025 and $45.53 billion in Europe alone. 

In-app advertising (IAA) is the display of ads to users within a mobile app. These ads can be rewarded ads, banner ads, interstitial ads, video ads, native ads, or playable ads. 

The big question: Which ads drive the most revenue?

For app owners, showing more ads may seem tempting. After all, everyone’s fighting for a slice of that sweet advertiser pie and higher eCPMs. 

So more ads = More revenue …Right? Ehh, goes the buzzer. 

Excessive ad exposure can ruin the user experience and do more harm than good. To monetize your app, you need to target the right users and serve the best ad formats, creating deep engagement funnels and profits.  Let’s examine which in-app advertising formats actually help monetize your app. 

Interstitial Ads

Interstitials are full-screen ads that appear during specific moments within an app. Interstitial ads are good for raising brand awareness and testing creatives for user acquisition. 

App developers increasingly choose interstitials over banner ads as in-app ad alternatives. Why? Because it mitigates banner blindness and offers higher CTRs, advertisers are willing to pay more for interstitials than traditional banner ads.

The average eCPMs for in-app interstitial ads in the United States fluctuate between $12 and $15, based on the device (Android or iOS). These rates vary depending on factors like your app’s niche, engagement metrics, and geo. 

But don’t overdo it

Excessive or poorly timed interstitials can disrupt the natural user flow, leading to high app abandonment rates, while technical errors like slow load times can impact user experience. 

When to use interstitial ad formats? 

Interstitials work well with natural breaks in the user journey. Examples include gaming apps, news apps, or utility apps that have easy transitions. The popular game Candy Crush uses interstitials to display ads between game levels.

Some other variations include native ads that blend with the app’s content and mimic its appearance. If designed well, native ads seem non-intrusive and appear as part of the app’s interface. 

Playable ads are interactive advertisements that allow users to engage with a mini-version of a game or app before downloading. The ‘try before you buy’ approach enhances user engagement and can lead to higher-quality ads.

Rewarded Ads (Playtime edition) 

Rewarded ads are the triple handshake win-win-win for app owners, advertisers, and end users. But we’re adding a slight twist to this strategy. Instead of a one-off reward, we’re embedding deep-funnel engagements that go beyond the initial install. 

With adjoe’s Arcade and Playtime solutions, users engage with ads in exchange for rewards they care about – like in-game currency or exclusive perks. Instead of low-quality, annoying ads, users discover top-rated games and relevant apps they’re eager to try, all within your app. 

By continually engaging with these offers, users earn your app’s currency or special perks, which means more engagement, more retention, and most importantly, more revenue for you. 

Just ask Macadam, who saw a 15% boost in eCPM and a 30% increase in ARPDAU thanks to adjoe Playtime.  

2. In-App Purchases 

In-app purchases (IAP) occur within the app, allowing users to buy digital items, features, or services. It’s the app version of “Hey, you want fries with that?” IAPs come in three flavors:

• Consumables: Items used once and can be repurchased. 
• Non-consumables: Items purchased once and used indefinitely.
• Subscriptions: Recurring payments for exclusive content or services.

Examples of in-app purchases:

• Games: In-game currency, power-ups, extra lives, or new levels.
  
• Fitness Apps: Training programs or premium content.
  
• Dating Apps: Extra swipes or premium features.
  
• E-commerce Apps: Virtual items or exclusive merchandise.

In 2024, global in-app purchase (IAP) revenue on iOS and Google Play reached $150 billion, according to SensorTower’s report. Which means if you get it right, users are happy to shell out and enhance their in-app experience. 

But what’s the catch for the in-app purchase model?

Both Apple and Google levy app store commissions to publish apps with in-app purchases, around 15-30% of your revenue. Some developers see it as unfair, especially compared to apps monetized through in-app advertising or subscriptions. 

It’s no surprise that giants like Netflix and Spotify are bypassing app-store purchases and directing users to website subscriptions to avoid the fee. 

🧐 Questions to ask yourself before jumping on the IAP bandwagon 

•  Will the IAP model improve user experience, or create friction?
  (Forced paywalls risk churn.)

• Is my app’s category proven to monetize well via IAP?
  (Gaming, fitness, and productivity work—others may not.)

• Can I scale monetization faster with IAA instead?
  (IAPs require high ARPU or big volume to outperform in-app ads.)

• Are users willing to pay, or are they just looking for free content?
  (IAP relies on user intent; if users expect free apps, conversions may be low.)

3. Freemium

Freemium apps give users a taste of your app (think a trailer for your app-movie), where users dip their toes into your app’s basic functionality for free. 

Examples include listening to your favorite Spotify playlist with ads. Or reading the New York Times’ 10 free articles per month, or Evernote, where you jot down up to 50 notes for free.

The premium features hide behind the paywall, accessible only once the payment is made. The real value comes when users upgrade to access premium features, like ad-free experiences, exclusive content, or even a subscription for continued use.

A benefit of the freemium app monetization model is acquiring users at scale, without requiring them to pay upfront install costs. 
App owners can increase potential revenue with hybrid monetization models, offering in-app ads or in-app purchases to freemium users. 

You can allocate resources based on a customer’s lifetime value (LTV), offering additional support to premium users. Whereas, the monthly active users (MAU) on the free version of the app are prospects for future paid users, driving more loyalty and engagement. It gives users extra options and you extra revenue. 

Let’s take Spotify’s case: With a hybrid monetization model (freemium, in-app ads, subscription), the music-streaming giant’s monthly active users reached 675 million. 

Spotify’s free-tier (with in-app advertising) drove an 11% YoY rise in paid subscribers to 263 million, boosting the total generating revenue to € 4.2 billion.
Hybrid monetization models are becoming a best practice to diversify your monetization portfolio.

4. Subscription Apps Model

There’s nothing better than recurring payments giving you steady, dependable in-app revenue.  

The subscription-based model is becoming a popular strategy for monetizing apps, with 82% of non-gaming apps opting for it in some form, along with app advertising. 

In 2024, only about 4% of total mobile apps used a subscription model, yet they accounted for 45% of global app revenue, mainly from top apps like Disney+, YouTube Premium, and Netflix in content-rich categories like entertainment.

It’s important to note that the majority of apps that adopted a subscription model do not achieve similar financial success. RevenueCat’s report reveals a stark disparity in earnings among subscription apps. The top 5% of earners garner revenues 200 times more than the bottom 25%. 

Should you use subscription-based monetization? 

• Single-Purpose Utilities: Apps that serve a one-time function (e.g., calculators, flashlight apps) rarely justify a recurring fee. Users often prefer free or one-time purchase options.

• Limited Ongoing Content: If an app doesn’t offer regular updates or new content, users may not see value in paying monthly for a static experience.

• Games: While some games with ongoing updates or multiplayer features succeed with subscriptions, most rely on in-app advertising formats like rewarded ads or IAP (for virtual items, currency, or removing ads) for revenue.

5. Sponsorships, Partnerships, and Affiliates 

Sponsorships allow a single company to exclusively advertise to your engaged app users. The benefits include targeted reach for a specific audience, brand exposure, and cross-promotion. However, finding the right sponsor is the main challenge for this model. 

For example, a fitness app could partner with a sportswear brand and offer users discounts on products. Or an event app prominently features a sponsor’s logo on the event schedule. 

Strategic partnerships with advertisers can be your ticket to new revenue streams. There are many creative ways to integrate your app partnerships.

• Integration partnerships
• Cross-promotions
• Sponsored content 
• Co-marketing partnerships
• Data licensing in similar app categories 

Potential drawbacks? 

Getting sponsorships right is a bit like matchmaking – finding the right partners requires careful research for mutually beneficial collaborations. Otherwise, it’s like mixing oil and water. 

Conflicting goals or priorities between parties can slow down the monetising process. 

Major tech companies like Google, Apple, and Microsoft offer app affiliate programs where developers promote other apps. While commissions are low, choosing relevant apps can strengthen brand association. 

It builds brand ties, but faces high competition, risks trust, and requires time to manage affiliates. Plus, you’re at the mercy of third-party partnerships, which means less control, but it has a lower entry threshold. 

Niche applications can use this type of monetization to promote products or services connected to the user base. 

That said, don’t put all your eggs in the affiliate basket; consider it as part of a diversified monetization strategy. Check whether your app aligns with other quality apps, as promoting reputable apps can enhance your brand image. 

Which App Monetization Model to Choose for Your App?

The Road to Revenue: Monetize Your App the Right Way

Now that we’ve examined different mobile app monetization strategies, it’s all about finding the right balance – making money without losing the magic that makes users stick around. 

With results like 25% higher ARPDAU for gaming apps and 272% more frequent daily sessions for fintech apps, Playtime makes app monetization effortless. 

Excited to learn more? Talk to adjoe experts on how Playtime can work for you!