As of this article, there are over 490,000 mobile games on the Google Play Store and 208,000 games on the Apple App Store. If you want your mobile games to be profitable, then you need a strategy.

This guide will help you demystify the arts and monetize mobile games at will. You’ll learn everything from understanding the different models and strategies to creating a holistic approach that works just right for your game. 

Grasping the Concept

grasping monetization model concepts

Monetization can make or break your mobile game. Grasping a thorough understanding of monetizing your project is vital before you can call your project a successful one. We’ll now discover what game monetization means. 

What is Mobile Game Monetization, and Why Does it Matter?

Game monetization models are all about generating a reliable and steady income. They can include downloads, player engagement, and other sources.

They are the vital life-support system for your game, which can fuel your future projects and support continuous improvement. 

Even the most popular games could go flat without a solid strategy. Some games can be a super hit at launch; others need time to bring revenue. The key tactic in this journey is how well you strategize your monetization efforts from the beginning. So, let’s dive deeper.

Setting the Stage

As you’re busy crafting the mechanics for your upcoming mobile games, you must also consider how you will make money. Monetization is not something you can add whenever you want; it must be part of your game design.

one does not simply create money from games

The model you select is as critical as your game’s structure, graphics, difficulty levels, storyline, and features. A well-thought-out strategy can be the main difference between your project losing money or becoming highly profitable.

So, make sure you design the foundations, decide on your monetization KPIs, and ensure that your gameplay and monetization model blend perfectly in the earliest stages of development.

Unraveling How Mobile

mobile games profit plan

Games Make Money

Many paths lead to success when you want to generate revenue from mobile games. Free-to-play or F2P titles dominate the modern-day gaming landscape by generating income through microtransactions.

They can also collect ad revenue from in-game advertising like banner ads. Another option is to require a subscription fee for exclusive ad-free gameplay and unique content.

Further still is the option to implement a hybrid model combining two or more strategies. 

So, how do you pick the right monetization mix? Knowing your players and their preferences will come to your aid. 

Glimpsing into the Earning Potential of Mobile Games

Do you ever want to learn how much money your mobile game can make? The short answer is that earnings can range from modest to remarkable. While you can aim for an enormous payoff, remember that such success is not guaranteed. Instead, it largely depends on creating an exceptional game and implementing a well-thought strategy. 

Let’s take a look at the leaderboard toppers of 2022. Honor of Kings made $1.65 billion; Genshin Impact earned $1.25 billion, and PUBG Mobile raked in $1.12 billion. Even our old favorite, Candy Crush Saga, produced a billion dollars. 

While these are some quite impressive figures, they result from various factors. The game’s widespread popularity, a well-targeted demographic, and an impactful monetization model all played their roles. 

Relatively few games will reach this level of success. But your title can go big if you couple it with the right approach. Let’s explore these models in more detail.

Models for Mobile Games

mobile game models

As we further explore game monetization models, we must assess their effectiveness. Game publishers directly impact gameplay and player experience – two critical elements for monetization success. Let’s look at these methods, beginning with in-app purchases.

Exploring the Realm of In-App (or In-Game) Purchases

In-app purchases are one of the best strategies for monetizing a game. Simply put, players can buy virtual goods or extras within the game to enhance their gameplay experience or get ahead of their peers.

Consider PUBG Mobile, a game that has utilized the model successfully. The game offers a variety of in-app purchases such as costumes, weapon skins, and ‘UC’ (Unknown Cash), its in-game currency, that can be used to buy these extras.

This leads to a more immersive and personalized mobile gaming experience for players. It also serves as a substantial revenue stream for the developers.

Spotlighting Features for In-App Purchases

While offering in-app purchases, you want to provide players value without making the gameplay experience depend solely on these purchases. They can range from:

  • Extra Lives: Players enjoy another chance to continue gameplay after they’ve run out of lives, health, or fuel. Any player who wants to maintain progress will often happily pay for this added benefit.

  • Power-ups: These special abilities or boosts help players advance rapidly or overcome challenging game chapters or sections. Players use power-ups to get a temporary boost of their in-game abilities.

  • Unique Character Skins: Cosmetic changes like character skins don’t impact the gameplay but give players a more personalized gaming experience. Many players may enjoy this chance to stand out in multiplayer settings.

  • Access to New Levels: Allowing players to unlock new levels or game areas can motivate them to purchase or subscribe. Especially games where progression and exploration are crucial elements based on the gameplay have a higher chance of benefiting from it.

  • Bundles: Bundles bring together various in-game items, like power-ups, skins, or healths, and offer them at a discounted price to each item’s total cost.

  • Monetized Wait Timers: Here, players can pay to bypass wait times or speed up processes within the game. This appeals to the player’s desire for instant gratification and can be an effective strategy in time-sensitive games.

  • Time-Limited Offers: Special offers available for a limited time create a sense of urgency, prompting players to make quick purchase decisions. These can include discounts, exclusive items, or seasonal content.

When choosing in-app purchases from the available mobile game monetization strategies, remember that purchases should be appealing and optional to progress in the game. A compelling mix of consumables, non-consumables, and savvy pricing can bolster your game’s revenue potential.

If you want a deep dive into in-game purchases, we wrote a guide to give you all the do’s and don’ts of successfully implementing this strategy.

Understanding In-App Advertising

In-app advertising is a go-to monetization model for developers, offering a steady income stream through displaying ads within games. This works particularly well in free-to-play games, as no upfront payment is required from players. Now, let’s take an in-depth look into how it works and explore the range of ad formats available.

Mechanics Behind In-App Advertising

The concept here is simple: advertisers pay to display their ads within your game, and you receive revenue each time players view or interact with these advertisements. 

This mutually beneficial model monetizes your game, allowing advertisers to engage their target audience. Yet, you need to find the optimal ad frequency for a smooth user experience and avoid irritating players.

Mobile Game Ad Formats

You can implement various ad formats within your mobile game, each with unique features and benefits.

  • Interstitial Ads: These full-screen ads typically appear at natural breaks or transition points in the game. While they offer high visibility due to being full-screen, use them cautiously to prevent disrupting the player’s experience.

  • Rewarded Video Ads: User-initiated ads offer players in-game rewards for watching a short video. Because of being less intrusive, these video ads often lead to better engagement and acceptance among most users.

  • Playable Ads: This innovative format allows players to try out a mini-version of another game or app. It’s a highly interactive format that offers a sample experience of the advertised game or app, boosting the likelihood of user acquisition.

  • Banner Ads: These small ads appear at the top or bottom of the screen. While they’re less intrusive, they also tend to have lower engagement rates.

  • Offerwalls: These are dedicated spaces within the mobile game where players can engage with various ads in return for in-game rewards. Users can control and choose, leading to this option’s rising popularity. 

The Subscription Model

subscription plans

Subscriptions are an excellent way for developers to secure a regular income while providing players uninterrupted access to the game’s content or special features. You can also use a subscription to award in-game currencies, which players can use to make an in-game purchase.

Various subscription models for monetizing your mobile game include:

  1. Individual Subscriptions

Here, players pay a recurring fee to access certain benefits within your game. This could include ad-free gameplay, access to exclusive content, or special status. Your most dedicated players will love the ongoing value they get from your game.

  1. Umbrella Subscriptions

Many game developers have multiple games under their banner. An umbrella subscription allows players to access premium features across all these games for a single recurring fee, increasing the perceived value and encouraging higher engagement across multiple games.

  1. Battle Passes

Players will find time-bound offers upon progressing, accomplishing specific tasks, or reaching levels. Games like Fortnite contributed to its popularity. The exclusivity and time sensitivity can drive subscriptions.

All subscription models come with various benefits for players – ad removal, priority access, exclusive content, and more, making it a win-win for developers and gamers alike. A compelling value proposition can make the recurring expense worthwhile for players.

Leveraging Meta Layer Monetization

mobile game ad revenue

Meta layer monetization is gaining traction in the mobile gaming industry, offering a unique way to interact with and generate revenue from games. The approach involves introducing an extra layer of activities that increase players’ engagement and provide them with added value and more immersion.

What is Meta Layer Monetization?

Meta layer monetization provides an extra dimension to gaming, with features such as leaderboards, tournaments, and social interactions that draw players in beyond the basics. 

These extra elements don’t necessarily affect core gameplay. Instead, they make for a more profound and immersive gaming experience. Such an experience can often lead to greater user engagement and longer user retention.

Meta Layer Monetization Examples

Fortnite is an excellent example of meta-layer monetization in action. You can construct structures and form clans, which are not part of the core gameplay but add to your gaming experience. 

Meta layers within Fortnite incentivize players to stay longer and spend more, making the game even more enjoyable. Moreover, global events allow users to engage with fellow Fortnite gamers and further their gaming journey.

Strategies for Implementing Meta-Layer Monetization

Here are a few strategies for implementing a successful meta-layer strategy.

  • Adding Social Features: Incorporating social features, like chat functions, clans, or shared objectives, can enhance the sense of community within the game. They promote player retention and in-app purchases.

  • Competitive Elements: Adding leaderboards, tournaments, or in-game challenges can stimulate player engagement. Consequently, players find it desirable to invest time and money into the game.

  • Exclusive Content: Providing access to exclusive content or experiences through the meta layer can serve as a strong incentive for players to make in-game purchases.

Blending the Best of All Worlds: Hybrid Monetization Strategy

Do you want to have your cake and eat it too? Turn to hybrid monetization. It allows you to leverage the strengths of different monetization models, ensuring you cater to a diverse group of players and providing multiple revenue streams.

In-App Purchases + In-App Ads

This combo can help you earn from paying and non-paying players. Here you keep the in-game purchases central to the model and in-game ads as a supplement. Opting for user-friendly ad formats, like rewarded video ads, would be an intelligent choice.

In-App Purchases + Subscriptions

This model targets players willing to spend money on mobile games. While in-app purchases provide various ways to enhance gameplay, subscriptions can appeal to most dedicated players looking for premium benefits.

In-App Purchases + In-App Ads + Subscriptions

Many developers combine all three models to tap into a broader player base and diversify for multiple revenue streams. In-app purchases usually take center stage in this setup, with ad revenue and subscriptions providing supporting layers. 

Monetization Strategies and Selecting the Right One

selecting mobile game monetization models

There are so many game monetization approaches to choose from. Getting this right involves several key considerations. Here are a few vital pointers:

  • Understand Your Audience: Know their preferences, spending habits, and tolerance for ads or subscriptions.

  • Analyze Game Mechanics: Ensure your game monetization aligns seamlessly with its game’s mechanics and does not disrupt the flow.

  • Test and Learn: Implement A/B testing to see what works best. Constantly gather and analyze player feedback to improve your monetization strategies.

  • Think Long-term: Consider the sustainability of your chosen monetization model over time. Balance immediate revenue with long-term player retention.

  • Focus on the Main Model: Your primary monetization model should integrate smoothly with the core game experience. Additional models should enhance and not overshadow this.

Monetizing mobile games is more than choosing the suitable model; it requires a strategic approach to unlock your game’s earning potential.

Importance of Early Stage Strategy

chess clock for early mobile game strategy

One of the critical aspects of successful game monetization lies in its incorporation during the early development stages. By embedding monetization into the core of the game design process, you ensure a seamless user experience.

Rather than being an intrusive add-on, it becomes a part of the game that complements and enhances the gameplay.

An effective monetization plan starts during development, stressing player retention and avoiding game design shortcomings such as pay-to-win systems. A/B testing can also help you discover which strategies are most successful in generating revenue.

The Role of Player Retention in Game Monetization

Keeping your players engaged over an extended period is fundamental to optimizing game monetization. The longer a player stays, the more chances arise to rake in revenue via in-app purchases, ad impressions, or subscription renewals.

Using Churn Rate as an Effective Retention Metrics

The flip side to retention is the churn rate – the percentage of players who stop playing your game within a specific timeframe. More specifically, the churn rate indicates the rate at which existing and active users have left your game through uninstalling or unsubscribing. 

A lower churn rate is always desirable. On the other hand, a high churn rate suggests checking if any functionalities or crash issues within your game app are causing players to leave. 

Importance of A/B Testing in Monetization

Just as game design requires continuous iteration and improvement, so does monetization. Employing A/B testing allows you to compare the effectiveness of different monetization strategies and make data-driven decisions. You can test various aspects such as: 

  • Ad placements, 

  • Types of in-app purchases, 

  • Pricing tiers for subscriptions, and 

  • Frequency of ad displays. 

This continuous optimization ensures your strategy remains effective and profitable over time.

Pay-to-Win Mechanisms

Danger Will Robinson, danger! Devs navigating the realm of game monetization must be wary of the following pitfalls associated with pay-to-win mechanisms:

  • Alienating Players: Games that allow players to buy significant advantages can risk pushing away those who prefer free gameplay or smaller purchases.

  • Unbalanced Gameplay: Pay-to-win structures can disrupt the game’s balance, as they often benefit players willing to spend more.

  • Negative User Experience: This mechanism may lead to negative user experiences, deterring players and negatively affecting your game’s reputation.

  • Player Retention Challenges: If non-paying or low-spending players consistently lose against high-spenders, they may abandon the game, causing retention issues.

Timing Your Monetization Efforts for Enhanced Effectiveness

The timing of your monetization efforts can significantly impact their effectiveness. For example, introducing monetization features too early in the game can alienate players, whereas waiting too long may mean missed revenue opportunities. 

So ensure your game offers enough value to warrant monetization and that such features are introduced at an appropriate stage in the user journey. Regular testing and adjustment of your monetization timing can optimize your revenue potential.

Evaluating Your Monetization Strategy

evaluating your monetization strategy

Once you’ve implemented a strategy for your mobile game, evaluating its effectiveness is essential. Let’s walk through a few ways to assess your game monetization techniques through various KPIs. 

KPIs for Ads

When you’re running paid ad campaigns, the Effective Cost Per Mille, commonly known as eCPM, stands as a pivotal KPI (Key Performance Indicator) for gauging the revenue efficiency of ad campaigns. It quantifies the revenue generated per thousand ad impressions. 

The formula is pretty simple. Divide the total earnings by the number of impressions, then multiply by 1000. This metric provides a clear lens into how efficiently your game ads turn views into revenue.

Deciphering CPM vs. eCPM

While CPM (Cost Per Mille) and eCPM relate to ad revenues, they serve different purposes. CPM is the cost an advertiser pays for a thousand views of their ad, whereas eCPM represents the actual earnings from a thousand ad impressions, regardless of the pricing model (CPC, CPI, CPA, etc.). eCPM is especially useful for comparing the performance of various ad campaigns and monetization strategies.

Determining a Good eCPM for Your Game

A “good” eCPM can vary greatly depending on several factors: 

  • Type of mobile game, 

  • Target audience, 

  • Geographical location, and more. 

You can gauge whether your revenue strategy is effective by tracking your eCPM over time and comparing it with industry benchmarks. Remember that while high eCPM is generally positive, it should not come at the cost of user experience.

In-App and Subscription KPIs

Understanding your KPIs enables you to maximize your in-app purchase and subscription revenue. By tracking these metrics, you can gain valuable insights into the performance of your game and fine-tune monetization strategies to ensure optimal profitability. Here are some relevant KPIs that stand out:

  • Average Revenue Per User (ARPU): Pretty straightforward as its name suggests, this KPI offers a snapshot of the revenue generated from each active user over a given period. 

  • Daily Active Users (DAU): Game publishers want to measure their game’s engagement and popularity. DAU is the go-to metric. It tells you how many unique players interact with your game daily.

  • Average Revenue Per Daily Active User (ARPDAU): This is a combined KPI. You’ll get an in-depth look at daily income relative to user count. The data is invaluable for tracking daily monetization performance.

  • Time To First Purchase: Do you want to know how long users can make their first purchase? This metric reveals the average time to convert from players to paying customers. You can easily quantify the impact of your in-game offers for monetization. 

Meta Layer KPIs

If you’ve decided to leverage the meta layer of gaming, where deeper interactions and social dynamics come into play, different KPIs come to the forefront:

  • Session Length: This KPI is an excellent measure of user engagement with your mobile game. Longer sessions mean that the game offers captivating content and gameplay elements.

  • Session Interval: This metric identifies the gap between players’ gaming sessions. You’ll get an understanding of player engagement frequency. Short intervals indicate that players come to the game shortly after leaving it due to its addictiveness or unique meta-layer features.

  • Session Depth: These are the interactions within one session, such as levels, challenges, and interactions. They reveal how deeply engaged players are with the mobile game. 

  • Social Shares: They reveal how often content and achievements are shared on social media. As a result, you’ll understand the communal aspect of your game’s meta layers. A surge in shares generally leads to more visibility and organic growth.

Aiming for an Increased Customer Lifetime Value

These KPIs and monetization strategies aim for a single goal: boosting the Customer Lifetime Value or CLV. CLV represents the total revenue you can expect from a single player throughout their interaction with the game.

  • Why CLV Matters: Beyond just a metric, CLV offers a lens into players’ long-term value and loyalty. A higher CLV indicates not just immediate profits but a sustained user base. This is highly valuable for the game’s longevity and consistent revenue stream.

  • Driving Strategies with CLV: Customize each of your tactics to enhance CLV. Whether prolonging the session lengths, optimizing paid campaigns, or increasing social interactions, the end goal is always to ensure that players find continual value in your game. This will ultimately lead to increased spending.

  • Holistic Overview: CLV is not about short-term gains; it’s about crafting a captivating game experience. Ultimately, the engaged players will invest time and money long-term.

Final Thoughts: Recommendations to Maximize Revenue

Optimizing your mobile game monetization strategies is the art of combining excellent gameplay, aligning players’ expectations, and leveraging suitable approaches.

To wrap up our discussion, here are some recommendations to help you maximize your mobile game revenue:

  • Exploring Mobile Ad Networks: Unity Ads, AdMob, and WebEye offer various ad monetization to help boost revenue. But be careful. Too many ads can have the opposite effect. 

  • Paid Games Aren’t Going Anywhere: While free-to-play games are popular, don’t discard the value of one-time purchases. There is a reason why big game publishers like Valve and Activision/Blizzard still use paid games; they offer significant upfront capital.

  • Leveraging Subscriptions: Offer worthwhile perks and exclusive content to entice players to subscribe. A consistent revenue stream is sexy.

  • Embracing Rewarded Ads and In-app Ads: Rewarded ads are generally well-accepted by players and can significantly boost engagement and monetization. But remember not to overdo it.

  • Evaluating the Effectiveness of Playable Ads: Playable ads can be a hit or a miss, depending on the ad. Try to find a partner with ads that align with your game. A/B Test different ones!

  • Optimizing In-Game Purchases: Make in-game purchases exciting and valuable. Regular updates, seasonal content, and limited-time offers can increase the players’ willingness to spend.

  • Mixed Game Monetization Strategy: When considering a hybrid model, try the following to diversify your revenue streams.

    • Direct Deals: An advertiser buys ad space in your game. Compare it with inviting a friend to put up a sign in your yard. The approach eliminates any middlemen like ad networks and generates more revenue.

    • Merchandising: You can create and sell cool game-related stuff. It could be anything from t-shirts, mugs, posters, or even items and characters from your game. You can build a loyal fan base and get some extra money.

    • Branded content: You can add brands to your game to enhance the player’s experience. The cool and creative way to make some extra bucks can add a touch of realism to the gameplay.

Stay tuned with industry trends, listen to your gamers’ feedback, and be ready to customize your strategies as needed. Don’t forget to check out these alternative indie developer game monetization strategies. And remember that you don’t have to do this alone. Here at Zalance, it’s easy to start adding payments, item catalogs, and in-game stores.