game monetization

So you have a loyal player base. But what about your game’s revenue? Without a game monetization strategy, you might be missing out on serious income. Various game monetization models out there have been tried and tested by the best game developers in the world. So why not join them and maximize your game’s profitability too?

What is game monetization?

Game monetization is how developers transform player engagement into revenue. Multiple game monetization strategies can drive a game’s financial success. 

We’ll focus on four key game monetization strategies: In-game advertising, in-app purchases, subscription models, and premium paid models.

4 Game monetization models for mobile games 

Let’s run through each key game monetization model to help generate income for your mobile games.

1. In-game advertising

This common model generates revenue by presenting ads within games. Different ad formats are used for different purposes, each with its pros and cons.

A comparison table of in-game ad formats

In-game ad formatHow it’s usedProsConsGames that use(d) it successfully
Banner adsSmall ads fixed at top/bottom of screen throughout gameplay.Non-intrusive and doesn’t disrupt gameplay.
Good for brand awareness and testing creatives.
Generates lower revenue compared to other ad types. Can be easily ignored.Candy Crush Saga, Clash of Clans, Sudoku, 2048, FIFA Mobile, NBA Live
Interstitial ads Full-screen ads appearing between game stages.More engaging and attention-grabbing. Can generate higher revenue due to full-screen format.Can frustrate if used too frequently. Interrupts gameplay, leading to potential negative experiences.
Flappy Bird, Subway Surfers, Temple Run, Final Fantasy Brave Exvius, King of Avalon
Rewarded video adsPlayers watch short video ads in exchange for in-game rewards (e.g., power-ups, extra lives, currency).Provides added value to players, boosting engagement. Builds goodwill by offering something in return for ad views.Too many rewards can damage gameplay. Players may skip ads, reducing effectiveness.
Mobile Strike, Toon Blast, Homescapes
Playable adsInteractive ads letting users play another game’s demo.High engagement rates and conversions due to interactive nature. More immersive ad experience.May not appeal to players interested in other games.
Can disrupt game flow if not implemented strategically.
Clash Royale, Rise of Kingdoms, Coin Master, Angry Birds 2, Alto’s Adventure
Integrated adsAds incorporated into game world (e.g., branded in-game items, billboards).Adds realism to game world.
Can blend seamlessly without disrupting gameplay.
Players might not engage with branded content. Can feel like product placement.
Asphalt 9, Need for Speed No Limits, FIFA Mobile, eFootball, The Sims Mobile
Native adsAds designed to match look/feel of game’s content/interface.Can result in higher engagement.
Smoothly fits into game’s UI.
Design might feel inauthentic.Lineage 2: Revolution, Elder Scrolls: Blades, FarmVille, Words with Friends

Revenue potential

According to Statista, global in-game advertising is projected to reach $169.40 billion by 2029. So the potential is huge. Revenue from in-game ads can vary significantly by format. Banner ads generate lower revenue ($1-$10 CPM), while playable and rewarded video ads offer higher financial results ($10-$60 CPM). 

2. In-app purchases

This popular game monetization model allows players to download and play a game for free. However, they are given opportunities to pay for extra in-game content to customize their version of the game. A few proven types of in-app purchases include:

  • Consumables: Items that can be “consumed” or used once, before being repurchased (in-game currency, energy boosters, and extra lives).
  • Non-consumables: Items that are purchased once, but remain permanently available (levels, new characters, and premium content).
  • Exclusives: Items that are only available to players for specific purchases (exclusive levels, special power-ups, and VIP access).
  • Cosmetics: Items that are specifically for customizing characters and features (skins, costumes, weapons).

It’s important to weigh out the advantages and shortcomings that come with implementing in-app purchases as a game monetization model.

Pros of in-app purchasesCons of in-app purchases
Generating revenue from a wide range of players, including those not interested in paying upfront. In-app purchases can be too expensive for certain players and can even put them off from your game altogether. 
Providing a diverse range of content for players personalizes their experience and gives them more reasons to return.Too many in-app purchases can come across as aggressive and even overwhelming. You run the risk of alienating them from the game.
IAP revenue helps sustain game development, raising budget opportunities for new updates, content, and optimizations.IAPs can risk damaging their game’s reputation if players start overspending, causing negative experiences, refund requests, and bad reviews.

Revenue potential: Varies widely depending on user base, genre, and types of IAPs. Well-balanced models can bring in monthly revenues ranging from hundreds of thousands to several million dollars. 

Games that use (or used) IAPs effectively: Clash of Clans, Candy Crush Saga, Fortnite, PUBG Mobile.

3. Subscription model

Often associated with streaming platforms like YouTube and Netflix, subscriptions can be a successful game monetization model for mobile. Almost like an in-app purchase, subscriptions offer players regular access to special features like new content and ad-free experiences for routine fees.

While some would argue that subscription models in mobile games are a type of in-app purchase, their unique game mechanics make them stand on their own.

  • Weekly: Paying a small weekly fee for short-term benefits like faster progress and daily rewards.
  • Monthly: Paying a recurring monthly fee for regular access to premium content.
  • Seasonal/event-based: Paying for limited-time features that are linked to specific seasons and events.
Pros of subscription modelsCons of subscription models
Players are more likely to stay engaged with the game as subscriptions build commitment and loyalty.Subscriptions can come across as forced when players feel like subscriptions are the only way to enjoy a game.
Players often get exclusive content and features from subscriptions, improving player satisfaction.Players could cancel a subscription if they feel like they’re not getting much long-term value from it.
Subscriptions provide steady, reliable income streams, making them ideal for future planning and optimizations.Players can experience fatigue if they are offered another subscription and already have multiple others.

Revenue potential: Subscription models in games offer steady revenue through recurring payments. This can range from $1 to $20+ per month. 

Games that are (or were) subscription-based: Fortnite, World of Warcraft, Apple Arcade, Marvel Snap, Apex Legends Mobile, Pikmin Bloom, Minecraft, Genshin Impact.

4. Premium paid model

With a traditional paid model, players simply make one, upfront payment to access the entire game. This model caters to players looking for a gaming experience free of ads, that is strictly gameplay from start to finish, and where they aren’t bothered by constant offers.

Pros of premium paid models:

  • Developers receive instant revenue from one-time purchases
  • Publishers can easily recoup their investment and turn a profit.
  • Allows for an uninterrupted gameplay experience.

Cons of premium paid models:

  • Can be challenging to convince players to pay upfront.
  • Paid games can have shorter lifespans than F2P games.
  • Players might become disengaged from no new content.

Revenue potential: Players can pay one-time fees ranging from $1 to $60 per title.

Games that have (or had) premium paid models: Stardew Valley, Monument Valley, Grand Theft Auto: San Andreas (Mobile), Slay the Spire, Balatro, Terraria.

Pick the right game monetization model (or combine a few)

Every developer implements different game monetization models to generate revenue. While you could use one model, it’s normal to implement a hybrid model. This involves combining multiple models simultaneously. 

For example, you could use IAPs and in-app ads to cater to paying and non-paying players. Or you could combine IAPs with subscriptions, solely focusing on enhancing gameplay for paying players.

Ultimately, successful game monetization balances revenue generation with player retention, creating high long-term lifetime value for your user base and game.

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