App Monetization: Which Ad Format Works Best For Your App?

We get it, monetization can be tricky for developers—balancing the need to make money and maintaining the integrity of your app and user experience. One of the toughest decisions in the process of monetizing your app is deciding which ad formats work best for your app. Luckily, we’re here to help. We’ll run down the the biggest factors to consider with the four most popular ad formats.

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Banner Ads

Banner ads are still the most popular ad format in mobile. This small and versatile ad placement at the bottom or top screen uses the least space and is the least intrusive to your app experience. However, users still find banner ads extremely annoying. In fact, in a 2014 study by Adobe, 33% of users reported banner ads as being intolerable. Sixty percent of all mobile banner clicks are accidental, according to a 2016 survey. In the same study, after accidentally clicking on banner ads, 68% of users reported feeling annoyed, 45% reported feeling frustrated and 22% reported feeling angry. While banner ads seem like the most simple and tasteful way to incorporate advertising into your app, your users might feel differently.

Video

Video is the most engaging of all ad formats, that’s why mobile video ad spending is growing faster than any other digital advertising format in the U.S. According to a Millennial Media study, mobile video is 5x more engaging than banner ads. This is great for eCPM’s, but video is also the most intrusive of all ad formats, especially if it occurs in the middle of app gameplay. In a Teads study, 41% of users cited pre-roll video as one of their reason for downloading adblockers.

There are, of course, workarounds to solve the problem of running off users with intrusive video ads. Kiip offers developers the option of rewarded video, offering users in-app virtual currency in exchange for watching sponsored content. This value exchange not only makes video ads tolerable, but welcomed to your app users. Another industry trend is vertical video, thanks to apps like SnapChat, we now know that users are tremendously receptive to this format (Kiip offers vertical video too!).

 

Native Placements

Native placements appear as additional content, with the same aesthetic as the rest of your app. These seamless and highly integrated ad placements help to maintain a superior user experience. Users are extremely receptive to native placements as they appear as additional content, adding to your app experience instead of detracting from it. According to a 2013 study, users were “25% more likely to look at a native ad than they were at a banner, and they looked at them 53% more frequently, checking them out 4.1 times per session on average, versus 2.7% for banners”.

Though users are more receptive to native ads, because of their seamless integration, native placements can often be overlooked, leading to lower engagement rates and lower eCPMs than more traditional ad formats. Another issue with native placements are that they can often feel misleading to users. According to one study, 86% of users felt deceived by native placements. All of these are factors to consider when considering native placements in your monetization strategy.

Interstitial

Interstitial ads overcome mobile’s biggest hurdle – limited real estate – by consuming the entire screen. Unlike banner ads, interstitials force users to interact by clicking out or clicking through the ad. Due to these actions, interstitials grab users’ attention and maintain high conversion rates. Interstitials advertisement is an often undervalued placement because they can be extremely intrusive if done incorrectly, however, they receive extremely high engagements and eCPMs when done the right way.

Kiip’s interstitial placements are offered to users in the form of a reward during natural pauses in-app that we like to call moments. Rewards including coupons, discounts and free items are often welcomed by users. Placing our reward interstitial during moments, make users much more receptive, according to our study with IPG.

Though monetizing your app can be stressful, this overview of ad formats is a good start building your monetization strategy. If you want to discuss monetizing your app with Kiip rewards, reach out to us at hello@kiip.me!

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