Article

Eli Mandelbaum
Eli Mandelbaum 1 September 2016

A Look Into The Future Of App Monetization

With an endless stream of mobile apps being introduced to the world every day, it is no surprise that mobile advertising continues to grow rapidly.

A 2015 analysis by Nielsen, revealed that while the number of apps the average American has on their phone stayed relatively the same over a two-year span, the time spent on those apps increased by 63%.

So, how are these apps making money? PluggedIn BD gathered a group of industry professionals from ad networks, monetization platforms, and app developers to discuss app monetization at a recent roundtable. As many shared their experiences, including their various failures and successes, they all agreed that there is an exciting future on the horizon. Read on to find out what three trends had everyone buzzing.

 Augmented Reality

Whether you love it or hate it, Pokémon Go cannot be ignored during a discussion about app monetization (at least right now). Though many believe its star is already beginning to fade, in this overnight sensation, Niantic capitalized off a combination of “old and new” — old being the nostalgia of a “retro” game and new being the use of augmented reality. 

As one panelist pointed out, Pokémon Go may be the game responsible for officially bringing augmented reality into the mainstream and that is something to get excited about. Augmented reality literally opens a whole new world (or worlds for that matter) to advertisers. It is easy to see that the possibilities in this space are incredibly promising — the question is, who will be the first to take advantage?

Bots

Will bots replace apps? The general consensus among the participants was: “No, BUT they can certainly complement them.” With so many different types of apps, there are a plethora of potential use cases for bots. One example shared during our discussion focused on the Domino’s Pizza app. In the app, users have the option of creating highly customized orders, but for someone who typically uses the app for the same order, having a Domino’s bot to quickly pull up their “usual” as soon as the app is opened, could prove to be a very useful component.

As with augmented reality, bots have not become part of the mainstream in this industry yet, but they are not far behind. A constant theme among the participants was that value to the user is essential to an app’s success and bots introduce an opportunity to improve the value and user experience of an app — therefore, they will be an important area of focus in the near future.

Increased Budgets

This is not necessarily a trend, but something to look forward to nevertheless. Budgets are finally shifting to mobile in a big way, though they do not come close to the budgets allocated to other industries just yet. Though our panelists agreed that the budgets will continue to shift in favor of mobile, there was some debate as to where the additional money would come from. Some believe that because the targeting capabilities are much more robust than TV, the budget would come from traditional media. On the other side, are those who believe that the budget will come from other digital marketing channels.

As cliché as it may sound, it truly is an exciting time for the mobile app industry and in terms of app monetization specifically, these trends will be part of the “mainstream” before we know it.

What are your predictions for the future of app monetization?

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