I'll never forget the day I made $47.
It was 2019. My first mobile game had been live for three months. I'd spent nine months building it, poured my savings into development, and launched with dreams of passive income. That day, $47 hit my account from ad revenue. I remember thinking: "This is it. This is working."
Then I checked my user metrics. I'd lost 2,000 daily active users that week. At my current churn rate, I'd be at zero within two months.
I was monetizing my app to death.
That experience taught me the first rule of app monetization: revenue without retention is a countdown to zero. It also started my obsession with finding the strategies that actually work—the ones that make money while keeping users happy enough to stick around.
Seven years and hundreds of apps later, here's what I've learned.
The Strategy That Saved My First App
Rewarded Video: The Exchange That Works
After the $47 disaster, I stripped out all my ads and started over. The first thing I tried was rewarded video—ads users choose to watch in exchange for in-app rewards.
The difference was immediate. Completion rates hit 92%. Users weren't annoyed—they were grateful. They were opting in, not being interrupted. And my retention stabilized overnight.
- Average eCPM: $10-50 depending on geo and vertical
- User sentiment: Generally positive when you get the exchange right
- Best for: Games, utilities, and any app where you can offer meaningful rewards
The Format I Used to Hate (Then Learned to Love)
Interstitial Ads: The Timing Is Everything
I used to think interstitials were evil. Full-screen ads that interrupt whatever the user is doing? Recipe for uninstalls.
Then I watched how successful games used them. Not randomly—strategically. After completing a level, not before. At natural breaks, not mid-action. With frequency caps that respected the experience.
- Show after completing a level or action, never before
- Implement frequency caps—no more than 1 per 2-3 minutes
- Use skip timers appropriately (5-7 seconds)
Done right, interstitials feel like breathers between sessions, not interruptions during them.
Native Ads: The Ones Users Don't Mind
In my news aggregator app, banner ads converted at 0.3%. When I switched to native ads that matched the content feed's design, that jumped to 1.8%. Same inventory, six times the engagement.
Native ads work because they don't fight against your app's experience—they become part of it.
The Benchmark That Matters
Top-performing apps using a combination of rewarded video and interstitials see ARPDAU (Average Revenue Per Daily Active User) of $0.05-0.15 in tier-1 geos. If you're below that, you're leaving money on the table. If you're way above it, check your retention—you might be squeezing too hard.
The Strategy That Created My Best Month Ever
In-App Purchases: Where the Real Money Lives
Ad revenue is great for scale. But my highest-revenue month came from a game where 3% of users spent money—and those users drove 70% of total revenue.
The key is offering purchases that genuinely enhance the experience:
- Consumables: Lives, coins, boosters—things they'll buy again
- Premium content: New levels, features, content packs
- Cosmetics: Skins and customization—pure margin
- Ad removal: Let users pay to remove what they don't want
Subscriptions: The Revenue That Keeps Showing Up
There's something magical about recurring revenue. You wake up on the first of the month already knowing a baseline of what you'll make.
But subscriptions only work when you deliver continuous value. Users won't pay monthly for something they got all the value from in week one.
- Free trials boost conversion dramatically—let them feel the value first
- Annual plans with discounts improve retention and cash flow
- Your value proposition must be crystal clear and continuously delivered
The Approach That Made Everything Click
Hybrid Monetization: Meet Users Where They Are
The breakthrough came when I realized different users want different relationships with my app. Some will never pay anything. Some will happily pay to avoid ads. Some will spend hundreds on cosmetics.
The best apps serve all of them:
- Free users: See ads and can watch rewarded video for bonuses
- Light spenders: Purchase consumable IAPs when they need a boost
- Premium users: Subscribe or pay once to remove ads entirely
Everyone gets value. Everyone monetizes. Nobody feels forced into anything.
"I used to think I had to choose one monetization strategy and commit. The most successful apps don't choose—they offer options. Let users self-select into the relationship they want with your app."
Offerwalls: The Engagement Engine
Offerwalls get overlooked. They present users with tasks—surveys, app installs, purchases—in exchange for in-app currency. The eCPMs are lower than video, but the users who engage are incredibly active.
Think of offerwalls as an engagement tool that happens to make money, not a monetization tool that happens to drive engagement.
What I Wish Someone Had Told Me on Day One
After seven years, these are the principles I'd give to anyone starting out:
- Test everything: Ad placements, pricing, timing—your instincts are probably wrong
- Watch retention religiously: If retention drops, revenue is next
- Use mediation: Let platforms compete for your inventory and maximize fill rates
- Respect the user: Short-term revenue extraction destroys long-term value
Finding Your Mix
There's no universal formula. Your monetization strategy depends on:
- Who your users are: Their spending power and preferences
- Your category: What works in games doesn't work in utilities
- Engagement patterns: How often do users come back? For how long?
- Competition: What do users already expect from similar apps?
Start with one or two strategies. Measure obsessively. Iterate based on what the data tells you, not what you assume.
That $47 day taught me the most valuable lesson of my career: the goal isn't to extract maximum value from each user today. It's to build a sustainable business where users want to stick around—and some of them want to pay you.
Get that right, and the money follows.