How Do Free apps make money?

With the mobile app, businesses can sell their services and products directly to customers. It is a source of income for every business. However, there are other application monetization techniques that can help you earn extra bucks. Therefore, investing money in app development is never a bad idea. Explore these methods to understand how you can impact them for your business.


The easiest way to make money through the app is by using a third party ad network. It’s very simple. You, the app owner, should display ads on your app and a third party will pay you for it. You get paid whenever an ad is displayed or when a user clicks on it or downloads it from a given ad. To display ads in your app, you can choose any of the 4 main types.

Interstitial Ads:

These are full-screen popup notifications that are displayed when a user completes an action or a specific time. Interested users can click the cross button to stop viewing this type of ad.

Banner Ads:

Banner ads are small strips, usually displayed on or below the app screen. These ads place more emphasis on not interrupting the user experience.

In-app video Ads:

Video ads are usually used as a gift to the user. For example, a video can be the user’s watch when he/she completes a level in any game to unlock the next level.

Native Ads:

Local ads are different from other ads because they look like a natural advertising element. This type of advertising does not annoy the user, which is why they are the most popular ads. However, you should be aware that the revenue generated by these ads is usually lower than other advertising.


Consumers rely heavily on the digital world for their daily news, entertainment, and connectivity. This made the subscription-based model a success. Subscriptions are a common application monetization strategy used by app publishers on a large scale. Users subscribe to a type of content on a monthly, quarterly, or annual basis and pay a certain amount. Most apps initially offer free content so that the user has enough time to decide whether he/she wants to pay in the long run.

Memberships are typically used by cloud-based services or apps that provide audio and video streaming. News apps also generate a lot of revenue from subscriptions.


To earn those extra bucks, your app needs to be an e-commerce addition. You can sell merchandise through the app while also offering other services. To make things easier for small business owners, Amazon has come up with a service called Merch by Amazon that takes care of payments and deliveries.

This method is not applicable to all types of business but can generate good returns if implemented in the right way.

In-App Purchases:

The in-app purchase method is used to earn credits within ownage prank’s Prank app. There may be some features available to customers only after they are purchased. In games, it can be powerups, lives or certain levels and in other applications, it can be premium features that the user can buy. According to Forbes, in-app purchases give app makers the highest revenue.

Most games prefer this method because they have virtual currency. Other applications adopt this method to convert their unpaid users into more paid users. If this is the case, then it is the responsibility of the app owner to retain customers, so keep paying.

Referral Marketing:

Over the past few years, digital marketing has introduced new methods for different platforms. Referral marketing is one of the primary in-app marketing techniques. App publishers promote other third-party products or services to increase their ROI.

Here are a variety of referral models:

Cost per Acquisition (CPA):

In the CPA method, app publishers can promote other apps or use pop-up ads.

Cost per click (CPC):

CPC is a click-based app monetization method that displays the text and ads required to join networks such as app publisher Adfonic or Google’s AdMob.

View Per View (CPV):

The CPV model charges users based on the number of ad interactions or video views.

Cost to Install (CPI):

The cost of each install is relatively new. The app publisher pays for every install from the ads displayed in his app.


Sponsorship is used by some app publishers because not everyone knows about this method. In this method, you need to create your target audience community around a specific niche. Once you have successfully built this community, you will get sponsors who are similar to your app’s target audience. Therefore, you should have a list of companies and entrepreneurs who will be your future sponsors.

Collect and sell Data:

Companies are becoming data-driven every day. This has increased the demand for user data that can give insights into behavior, demographics, and columns, and how you can use your app to make money.

App publishers have access to user details such as email addresses, social media, and certain personal interest details. First, you need to understand your customers in a good way. Second, all the data you collect can be earned by selling it to some company that needs it. The more relevant data you have for a company, the more you will benefit from it.





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