What is In-App Advertising (IAA) for Mobile Apps?

What is In-App Advertising (IAA)?

In-App Advertising or IAA is a method of ad monetization, where money is made through showing advertisements inside a mobile application.

There are two main methods of mobile app monetization today, namely: in-app purchases (IAP) and in-app advertising (IAA). And mostly, a combination of both methods is used. IAA is the main driver of the freemium app market, as it gives mobile developers the incentive to offer their apps for free. Users can then use the app for free, but still be shown advertisements. These advertisements are paid for by ad buyers who pay per impression or engagement.

What are the benefits of In-App Advertising (IAA)?

In a world where most mobile app users are reluctant to make in-app purchases, the benefit of in-app advertising is clear. IAA allows mobile developers to make money from a free product. It is also beneficial to the end users because they can now use an app for free, while the app developer also has a financial incentive to keep developing apps.

How do you implement In-App Advertisements (IAA)?

The first step to implementing IAA is to map out your user journey and identify advertising opportunities within your app. Then, you can contact a mediation provider to help connect you with ad buyers, and you can decide on a bid based on geography, ad placement, etc. Next in line, would be to choose the ad format. There are several different ad formats to choose from, such as, banner ads, video ads, interstitial ads, rewarded ads, native ads, and playable ads. It is crucial to choose an ad format mix that is suitable for your app genre. Most IAA heavy apps are mobile games, utility apps, or streaming apps. For example, gaming apps might benefit the most from playable ads that keeps the user engaged, or rewarded ads where the user is compensated for viewing the ad voluntarily. While utility apps tend to employ more banner ads that don't interfere with the functionality of the app. Streaming apps usually run video ads.

The most important thing is to choose spots where the advertisement is not so intrusive. It is important to strike a balance between the frequency of showing ads, and user retention because users who are shown too many ads in a short period tend to churn. Growth FullStack has a number of plug n play queries to help you strike a good balance between ad frequency and user LTV. If you’re interested in learning more about these queries, reach out to info@growthfullstack.com.