IAA, IAP, or both? Why hybrid monetisation now dominates mobile apps

• Hybrid Monetisation is becoming the dominant model across multiple app categories
• Hybrid models allow developers to monetise their entire user base - paying and non-paying
• Many studios treat IAA as soft-launch monetisation, with IAP planned later

Query "how to monetise your mobile app" and you'll uncover dozens of articles debating between IAP and IAA. The model you choose significantly impacts your bottom line, determining your eCPM and ARPDAU. 

Hybrid monetisation is becoming the dominant setup across app categories. Hybrid models allow developers to monetise their entire user base, capturing value from both payers and non-payers alike. 

IAA is no longer just a monetisation choice; it is increasingly a market entry strategy. 

Hypercasual paved the way, but logic has expanded far beyond it. For casual, hybrid-casual, and even light midcore titles, ads now serve some critical functions at launch: 

By reducing reliance on immediate payer conversion, developers can generate revenue signals from early cohorts while testing retention, engagement and creative performance at scale. This makes IAA-friendly products far more tolerant of broad UA traffic during validation phases, accelerating learning cycles without overfitting the economy to a small group of early payers. 

In practice, many studios now treat IAA as a soft-launch monetisation layer, even if IAP is planned later. This allows teams to validate retention and engagement before committing to deeper economy design. 

However, pure IAA quickly hits a ceiling: both in ARPU and in player fatigue. This is where hybrid models begin to matter. 

The ad revenue mix and why it matters 

In core games where IAP is the primary focus, rewarded video typically dominates the ad revenue mix. Rewarded ads are user-initiated, similar to a low-value in-app purchase. Players choose to watch in exchange for something they want, so they can coexist with IAP without creating friction. In casual games with shorter retention windows, developers often employ a broader mix including interstitials. When users are unlikely to stick around for weeks, capturing ad revenue quickly becomes more important.  

The key insight: the first ad view from any user generates significantly higher eCPM than subsequent views. Smart developers focus on ensuring the highest possible percentage of users see at least one ad, rather than pushing multiple ads to a smaller group. 

For IAP-focused apps, users tend to be high-value and highly engaged. Even when ad revenue represents a smaller share of total revenue, improving ad monetisation efficiency can deliver meaningful incremental earnings. The key is implementing ads that complement rather than compete with your IAP economy. 

Emerging markets and the evolution of monetisation 

In emerging markets, IAP conversion faces structural challenges due to economic factors and payment infrastructure. This makes IAA a critical component of the monetisation mix. Developers who optimise their ad strategy for these regions can unlock significant revenue from large, engaged user bases that may not convert through traditional IAP channels. 

The evolution of hypercasual games illustrates the broader trend. Revenue growth is outpacing download growth across the industry, meaning every download needs to generate more value than before. This is why successful hypercasual publishers are moving products toward "hybrid casual": games that maintain broad accessibility while incorporating deeper gameplay loops and hybrid monetisation. The goal is to keep users engaged longer, which creates more opportunity for both ad revenue and potential IAP conversion. 

Looking ahead to 2026 

Industry observers note that ad revenue in mobile apps is growing at a healthy pace, with many analysts expecting continued expansion. Developers who master hybrid monetisation will be better positioned to compete for users and maximise the value of every download. 

GeeMee's ad solutions are purpose-built for IAA+IAP hybrid apps. Whether you're running a short drama platform, a utility app, or a casual game, GeeMee GamePlay Ads are designed to layer seamlessly on top of your existing IAP setup, creating incremental revenue without cannibalising paying users. Hundreds of developers across gaming and non-gaming categories have already used GeeMee to boost their ad revenue while maintaining strong user experience and retention. 

At the core of GeeMee's platform is AI-powered optimisation, our machine learning analyses user behaviour patterns in real-time, predicting which ad formats and creatives will resonate most effectively with each user segment. GeeMee's AI-driven approach enables hyper-precise targeting based on real user behaviour rather than broad assumptions, driving higher engagement and conversion rates. 

In 2026, GeeMee will continue to deepen our AI capabilities, helping developers unlock more value from hybrid monetisation as the industry evolves. If you're looking to add IAA to your existing monetisation mix or optimise your current hybrid setup, reach out to GeeMee today.