As more and more people are turning to their mobile devices for entertainment, news, and other resources, it makes sense that the advertising industry has started to take notice. Ads have long been a part of both the radio and television industries as a way for networks to earn money. Obviously, advertising space is sold during certain hours of the day and the price is largely determined by how large of an audience that particular time block receives. This is why an ad for the Super Bowl can cost millions while an ad on a local TV station might only cost $100. But, in terms of mobile advertising, how is the cost-per-ad determined?
Cost per Impression
For app developers, this is one of the best and easiest ways to monetize an app. An impression is essentially a tally of how many times the ad has been viewed. For instance, if you’ve got a monetized Android app and you are paid on a cost per impression basis, you will be paid every time someone sees the ad on your app. So, let’s say you have a nice little game app that has seen a marked increase in downloads in recent months. Any time someone plays your game they will obviously see the ad, and you will see some money.
Cost per Click
This is perhaps the most common way of receiving money via mobile monetization. Unlike cost per impression tactics, the cost per click formula requires users to actually do something other than look at the ad. On a mobile device, this is going to manifest itself in “click-throughs” from the app often to a mobile web browser or an app store. Using the same example from above, your Android game app will have a few ads here and there. Let’s say that one of those ads is for another game. Clicking on that ad will take the users to the Android app store where they can download the advertised game. You will, again, be paid for this click-through (even if the user does not download the other game).
Cost per Download
One of the newer ways to earn money with apps is with a cost per download formula. This method is a bit more convoluted than the other two but it isn’t any less effective. So, let’s say with your Android game, you’ve manipulated the Android developer tools to include special in-game features. With these features, your game might have a sort of virtual currency (for instance, chips in a blackjack game). If the user runs out of virtual chips, they can either buy more with real money or download another app (usually for free). Anytime the app is downloaded, the user gets more of the virtual currency and you get a little bit more real currency.
Mobile advertising is really one of the best ways to monetize your app. You can even use it in the reverse sense to promote your app in other apps. Android advertising is probably the easiest promotional platform to earn money because Google emphasizes monetization to the utmost. In any event, it’s clear that advertising and monetization on any mobile platform will be one of the most reliable forms of marketing going forward.
Marty Scott is an aspiring app developer for both the Android and iPhone market. His expertise is in the field of mobile monetization.