What Is a Game Monetisation Model?

A game monetisation model is the strategic approach a developer or publisher uses to make money from their game. Whether you're releasing a premium indie title or a free mobile app, monetisation is more than just an afterthought—it’s a fundamental part of game design and business planning.

The gaming industry has evolved far beyond the days of one-time purchases. Today, multiple revenue streams exist, and picking the right one is crucial to the game’s success. 

This blog unpacks the most effective game monetisation models, provides real-world context, and breaks down the critical factors every developer should weigh before deciding how to earn revenue.

What Is a Game Monetisation Model?

In simple terms, a game monetisation model defines how a game earns income. It's not just about adding ads or selling skins—it’s about building a financial structure around your game that aligns with user behavior, genre expectations, and platform constraints.

It determines:

• How users access your game (free, paid, subscription)

• How and when players are encouraged to spend

• How you balance free vs. paid valueHow you maintain profitability over time

Choosing the wrong model can lead to high churn, low engagement, and frustrated players. Choosing the right one builds long-term player satisfaction and sustainable revenue.

Why Game Monetisation Models Are Essential

Before we get into the models, it’s important to understand why monetisation matters—not just financially, but for the entire ecosystem of your game.

1. It Impacts Gameplay and Design Decisions

A monetisation model is directly tied to how a game plays. For example, if you're using a freemium model, your game must be designed in a way that encourages players to spend over time without making them feel disadvantaged. That could mean introducing daily challenges, time-based rewards, or progression curves that reward grinding and payment accordingly. 

Designing for a premium model, on the other hand, means focusing on delivering complete, polished content up front. Players expect full access with no interruptions, so the design must prioritise depth, polish, and satisfaction in a single experience.

2. It Shapes Player Expectations

Players interact with your game differently depending on how it's monetised. If they’re downloading a free app, they expect either optional purchases or ads. If they’re paying $30 for a console game, they expect a high-quality product with no microtransactions.

Failing to align monetisation with expectations can result in poor reviews, high uninstall rates, and revenue loss—even if the game itself is solid.

3. It Affects Marketing, Retention, and Long-Term Success

The right monetisation model gives your marketing team something clear to promote. Is it a high-value, premium experience? A free-to-play game with unique cosmetic options? A subscription that gives players exclusive content every month?

The structure you choose also determines how you'll retain players. Ad-based games need high session counts, freemium games need whales (top spenders), and subscriptions rely on consistent value delivery.

Types of Game Monetisation Models

Here’s a breakdown of the five most common monetisation models, how they work, and what you need to succeed with each.

1. Premium Model (One-Time Purchase)

Players pay once to access the full game. There are no ads, no in-game purchases, and no recurring charges. This model is typical for console, PC, and certain indie mobile games.

How It Works

• Game is sold for a fixed price (e.g., $9.99, $29.99)

• All content is available immediately

• Additional revenue may come from DLCs or expansions

Advantages

• Clear and transparent for players

• Encourages high-quality, polished experiences

• No monetisation friction during gameplay

Challenges

• High upfront cost may reduce reach

• One-time payment limits long-term revenue unless DLC is planned

• Success depends on strong first impressions and reviews

Best For

• Story-rich single-player games

• Indie titles targeting niche audiences

• PC and console platforms

Example: Hollow Knight earned critical acclaim and revenue through a pure premium model by offering deep gameplay and polished mechanics.

2. Freemium Model (Free-to-Play with In-App Purchases)

The game is free to download and play, but players can purchase optional content, items, or upgrades inside the game.

How It Works

• Base game is free

• In-app purchases (IAPs) include cosmetics, currency, power-ups, and premium features

• Often includes dual currencies: one earned, one paid

Advantages

• Low barrier to entry = large user base

• Allows flexible revenue streams

• Scales well with player engagement

Challenges

• Requires careful balance to avoid pay-to-win complaints

• Non-paying users may strain server and support resources

• High churn rates without a retention strategy

Best For

• Mobile games

• RPGs, strategy, and casual games

• Games with strong social or progression systems

Example: Clash of Clans uses freemium mechanics with optional purchases, encouraging users to spend without forcing it.

3. Ad-Based Monetisation

Revenue is generated by displaying ads in-game. These can be shown at natural pauses in gameplay or offered as rewards for user interaction.

Types of Ads

• Rewarded ads: Users watch videos for in-game rewards

• Interstitial ads: Full-screen ads between levels or retries

• Banner ads: Persistent, non-intrusive display ads during gameplay

Advantages

• Monetises non-paying users effectively

• Easy to implement with ad networks like AdMob or Unity Ads

• Works well in short-session games

Challenges

• Excessive ads can frustrate users

• Lower revenue per user compared to IAPs

• Requires high user volume for meaningful profit

Best For

• Hyper-casual or idle games

• Games with simple loops and short sessions

• Audiences that are price-sensitive

Example: Crossy Road popularised rewarded video ads that players voluntarily watched to earn characters, boosting both engagement and ad revenue.

4. Subscription Model

Players pay a recurring fee (monthly or yearly) for continued access to premium content, exclusive features, or a better experience.

How It Works

• Subscription unlocks additional perks

• Often includes daily rewards, premium currency, or exclusive content

• Can offer ad-free gameplay or early access to features

Advantages

• Predictable, recurring revenue

• Encourages long-term engagement

• Adds structure to content delivery

Challenges

• Requires consistent content updates

• It can be hard to justify if the benefits are unclear

• High cancellation risk if users feel value is missing

Best For

• Games with regular updates or seasonal content

• Platforms offering premium memberships (e.g., Apple Arcade, Xbox Game Pass)

• Community-driven or live-service games

Example: Roblox Premium offers exclusive currency and developer tools via a monthly plan, helping both players and creators.

5. Hybrid Monetisation Model

Combines two or more monetisation strategies—usually freemium + ads or freemium + subscriptions—to maximise reach and revenue.

How It Works

• The base game is free

• Includes optional purchases, subscriptions, and rewarded ads

• Users can choose how they support the game

Advantages

• Monetises different user segments (free, paying, high spenders)

• Increases revenue potential across player types

• Flexible and scalable with content

Challenges

• Can overwhelm users if not clearly structured

• Requires constant testing and optimisation

• Must avoid perceived unfairness between tiers

Best For

• Games with large, diverse audiences

• Competitive or PvP titles with seasonal models

• Games with live events, updates, or UGC elements

Example: Call of Duty: Mobile uses a hybrid model with free content, paid skins, battle passes, and rewarded ads—all presented in a clear, balanced system.