We make iPhone apps because we love to, right? Right! But we also need to pay the bills.  Many apps are either partly or solely supported by ads.

So if your app is ad supported, what are your possibilities for generating advertising revenue?

 
Here is what I think are your options:

1) Use just one ad partner
2) Try an ad aggregator
3) Build your own ad platform

Let’s look at how each solution works, as well as the pros and cons.

Use Just One Ad Partner

To add a single ad partner, you simply add their SDK to your app.  An SDK is a bit of code that calls the ad network for a banner to display to someone using your app.

Admob, Millennial Media, and Quattro all have SDKs that they would love for you to add to your app. Of course, if your app is already in the app store, you’ll need to submit an update to Apple after you’ve added ads to your app. Say that 10 times fast!

The pros to this solution are as follows:

• Fast -  it should take a few hours/days to implement
• Low technical – it will take technical resources, but less than other options
• Your making money – always a good thing

The cons?

• Single revenue source – what if their eCPMs* are really low?
• Fill rate – what if you serve 20,000 ads in a day and they can only fill 50%. You lose revenue and your users see a blank space where the ad should be displayed
• House ads – you typically can’t run any of your own ads

You can see by the cons, that a single ad partner, may be the way to start, but it is not a good long term solution.

*eCPM = effective cost per thousand impressions. If you have an eCPM of $1 that means you are earning $1 for every 1,000 impressions you show.

Try an Ad Aggregator

If you don’t have the resources to build your own ad server, you can turn to an add aggregator. Recently, a number of companies have started offering these services.

They include: AdWhirl, Mobclix, Mojiva, Tapjoy, and others. Here are types of things you’ll want to look for.

Ability to:

• Connect to all the ad networks you require
• Roll over from network to network when no ad is returned
• Set a % for each network or have them auto optimize for you
• Run your own house ads

Other questions:

• What is the cost: set up and ongoing?
• How difficult are they to integrate with?
• Do other app developers use them and like them?

Pros:

• You don’t have to build it!
• Better eCPMs
• Much richer features that you can probably initially build
• Roll over from network to network when no ad is returned

Cons:

• Giving up a piece of your revenue. I know AdWhirl doesn’t charge at this point, but won’t they need to eventually?
• What if any of these go away?
• Issues with Admob (perhaps this doesn’t matter or will blow over)
• Loss of control (perhaps building it yourself gives you an advantage)

NOTE: You could try to integrate with major web players like DoubleClick and/or Atlas, but I think it’s a big mistake. I’ve seen and heard very little to suggest it won’t be anything but a big headache.

Build It Yourself

Another option is to build your own ad server.  You put all the ad networks SDKs on your app and build a server to interact with them all.

This is a great option if:

• Ad serving is somehow core to your business
• You run the #’s and you’ll have a better ROI in the end
• You’re leery of how new the ad aggregators are
• You have expertise & resources that can do this
• You have very unique banner ad needs

These are all good reasons to build your own ad server. 

Pros:

• Some as with the agreggators, you’ll have better eCPMs
• You won’t be giving up revenue to an aggregator
• You can build it how you want it

Cons:

• You will have to build it!
• It may take a long time or take you away from building great apps
• It could cost too much money

It feels like we are in the “early days” of app advertising revenue, but things are progressing.

Have I missed any options? If so, let me know.

Photo credit: rob lee, drcorneilus, doug88888, colros