Angelina Lugova

@linosphere

App Monetization: Data vs. Ads

In the data-driven world, user data means A LOT. Armed with data, new industry players shake-up the established industries and transform traditional businesses into innovative ones with this new approach. However, not all companies are ready to deal with data monetization, but those who dare, boost their ability to compete.

App developers recently discovered that there is a lot of money in data. But how do you gather & transfer it correctly while also being trustworthy to your app users? Big companies, telecom operators and research institutes see user data as a strategic asset to further their business development, and app owners can provide them with relevant and actual data about the target audience they’re looking for.

While working with data monetization at Epom Apps, I have gathered the top-5 questions regarding data monetization. If you are looking for a sustainable alternative to ads in your app, data monetization may definitely be the answer.

What is app data monetization?

Data monetization is the process of gathering, analyzing, transferring, and the segmentation of non-personal information about app users.

Advertisers, marketers, research institutes, and telecom companies need quality data to make better business decisions or to improve their products. App owners have a lot of data they operate with during the internal optimization. And data collectors simply connect the dots by bringing app owners and demand together.

Data Monetization has enough pros to give it a try:

No risks of unsold inventory

By Monetizing your data through data intermediaries, you eliminate the risk of unmonetized inventory. Data monetization companies have exclusive partnerships with dozens of companies and pay for all of the user data they receive.

Weightless and non-interrupting SDK

The truth is that the data monetization SDK is only 50Kb and uses no battery and memory consumption, which means that the entire process of data monetization runs smoothly.

Higher CPMs

Since the competition in quality data is not as enormous as in mobile advertising, CPMs are higher. Data monetization intermediaries offer the highest payouts for some geos and pass the data further to the telecom companies, marketers, research institutes, etc.

Simple-to-implement

It has a simple mechanism: you add one lightweight SDK, prepare a user consent form, and after the user agrees to share non-personal data, you transfer it to the data collector.

Data collectors don’t gather sensitive or private information. As a result, all users stay anonymous and protected.

Okay, I have enough data to monetize. Who can I transfer it to?

Let’s define how much “enough” is. The “earlier — the better” rule doesn’t work with data monetization. The same trick is used with advertising: only the minority of app developers are happy with the results after trying it for the first time.

The story is as simple as that: the more DAU you have, the higher your revenue. So if you have less than 10k DAU you should keep growing your user base. When your app reaches 50 000+ DAU it’s time to try data monetization.

Working with data collectors directly, you face the risk of not selling your inventory, as big companies are usually one-time buyers. As data monetization works with non-personal data, data collectors are usually interested in buying it in bulk. 
Here’s why you need monetization intermediaries: they usually have exclusive partnerships with the global companies and handle all the risks securing you with timely payments. They gather data from 10–15 relevant apps and transfer it in bulk to data collectors.

Data intermediaries don’t gather private information: in fact, you are the one who controls how much data is to be transferred.

The internal process is as simple as that:

1. You evaluate your DAU;

2. Partner with data collector or data intermediary

3. Sign the IO and setup a price for every user;
4. Add the following permissions to your code:

<uses-permission android:name=”android.permission.INTERNET” />
<uses-permission android:name=”android.permission.ACCESS_NETWORK_STATE” />

5. Download the SDK

6. Prepare the User Consent

7. As soon as User Agrees to share with you their non-personal data, you’ll start earning.

Here’s how the user consent form will look like after downloading SDK on Android:

And here’s the form the user will see after opening your app:

Data monetization is absolutely worth trying as some of our app developers earn 30% more with data when compared to what they had with ads.

Which information is to be gathered during data monetization?

Nowadays, information from different sources is combined to give a 360* overview of the business goals. Data used for high-quality analytic reports shouldn’t always be private or personal, i.e. information allowing to identify the real person behind it. The more non-personal data put together, the more accurate it becomes.

For the sake of innovation, the company doesn’t need to know the user’s name — its the user’s behavior that interests them most.

Here’s a small reminder about what personal data to consider:

The basic non-personal parameters that data collectors usually gather include:

  • Device type;
  • Device version;
  • Screen size;
  • Mobile Operator;
  • Network type;
  • CPU Core number;
  • RAM, ROM;
  • Country;
  • IP address.

The best part of data monetization is that the app developer gets paid for the same users over and over again. The more DAU you have, the more appealing your app is to investors. The process will only move forward when your users allow you to collect their data. So don’t forget to ask before moving ahead.

Can I completely drop off ads in my application?

It had been argued a lot on forums, whether data monetization can be a worthy alternative to in-app ads in terms of revenue. The answer is: YES, but only if done right. 
If you’ve surpassed the mark of at least 50 000 DAU, you will be able to notice a significant effect from data monetization.

User Monetization SDK is 100% compatible with any other SDK you have. As data collection takes place in the background, the process of data monetization doesn’t affect the usage of your app.

According to Epom Apps stats, app developers who dropped ads completely, haven’t received any subsidence in-app revenue with data compared to what they had with ads. Test user monetization & ads SDK for a couple of weeks and see which one performs better in your app.

I’ve read multiple stories about user data leaks. Who’s responsible for that? And what can I do not to be among these unreliable apps?

Data privacy was the reason for big hype, not only because of GDPR but also because users finally understood that they were not able to protect their personal data from being gathered. Users still do not read the long and complicated privacy policies, but they at least should have a choice to opt-out from gathering their data.

For app developers, keeping the balance between data privacy, UX and app stickiness is a real challenge. Some of them drop the privacy while developing new features.

The most important thing to remember: you have to ASK users for their permission before gathering and transferring their non-personal data. For this, you’ll need to show the user a consent form in your app. Users will decide whether they allow sharing of their data or not.

Data monetization requires minimal or ZERO efforts and time invested. As long as the user agrees to share the data, you will keep getting payments from data collectors. Keep your app UX friendly and remember, that ads are one of the many monetization options.

Originally published at apps.com

Share your thoughts on the app monetization in comments for a fireside discussion. If you enjoyed this article, feel free to hit that clap button 👏 to help others find it.

More by Angelina Lugova

Topics of interest

More Related Stories