- We've Seen This Movie Before
- Benefits/Drawbacks of the Big Win and Steady Win Strategies
As an iPhone or iPad app developer you want to strike it rich selling your app to millions of customers, or at least tens of thousands of customers, to make your hard work pay off. Other equally ambitious developers hope to achieve a steady income and perhaps write apps full time and leave their other full-time jobs behind. While these goals are possible, it has become much more difficult over the past year to achieve such success.
There are several reasons. First, the sheer number of apps for sale on the App Store has made it much more difficult to stand out from the crowd. Instead of just a few similar apps in your category, there are likely hundreds, even thousands, vying for the buyer's attention.
You are competing against free and paid apps, some brilliantly written and some not even worth giving away.
Secondly, the intense pricing pressure causes many developers to start off at a low price or quickly drop their price to $0.99, a figure that makes it extremely difficult to break even much less make any profit. According to the website 148apps.biz, almost 42% of all apps (games included) are priced at $0.99. Figure 1.1 shows a range of apps, from free to $9.99, and their percentage totals on the App Store. You'll notice that 77% of all apps sold are at $1.99 or lower.
Figure 1.1 iPhone app prices tend to be bunched down at the $1.99 level and lower.
The sheer number of competing apps may seem daunting; however, these statistics are not presented to be discouraging. Rather, this chapter is designed to point out that the App Store has matured very quickly, and you have to develop a solid marketing strategy to realize success. The App Store is not running on Internet time, it's on mobile time! Your marketing strategy also has to be tuned to work with your buyer.
We've Seen This Movie Before
The App Store is much like your local supermarket. In the 1980s, the average supermarket carried about 7,500 items. Today, that same supermarket carries upward of 50,000 items! Every vendor is fighting for shelf space so more people will buy their products. Manufacturers want their products positioned at eye level or placed on their own display at the end of an aisle. They are willing to pay extra for this privilege. The supermarket makes its money through high volume turnover of its products. Those items that don't sell well are pushed to the bottom of the shelves or moved to another part of the store.
Amazon.com is no different; vendors are trying to stand out in a very crowded market. Not counting other items, its bookstore alone boasts well over 250,000 titles. Many authors hope to achieve fame and fortune by landing on the top 100 list on Amazon's book home page. Other authors hope to get their big break by being mentioned on Oprah.
The App Store has exploded from its introduction of fewer than 1,000 apps to well over 185,000 apps at the time of this writing. Just like the supermarket vendors, every app developer is vying for that eye-level virtual shelf space, hoping to get top billing so buyers will take a look. They are either hoping to make it into the top 100 sales for their category or get a mention in the "Staff Favorites," "New and Noteworthy," or "What's Hot" sections of the App Store. Table 1.1 shows the breakout of the different categories of apps available on the App Store. Approximately 450–600 apps are posted to the store each day! According to Apple, almost 10,000 apps per week are submitted for the approval process. At this pace we could easily see well over 225,000 posted to the App Store by the end of 2010.
Table 1.1. App Store Percentages for the Most Popular Categories on the App Store
Type of iPhone/iPad App
Percentage of Total Apps
As the App Store has grown, it has necessitated reconfiguration numerous times to further segment the apps into logical groups where buyers can more easily connect with sellers. Apple has improved the search capabilities of the store, added sub categories and added Top Paid Apps and Top Free Apps columns to each of the individual categories. As shown in Figure 1.2, the top paid, free, and grossing apps are displayed on the home page of the App Store.
If you drill down into a category such as Lifestyles, you see that there is also a breakout of the top 20 paid apps and the top 20 free apps. An example of this breakout is shown in Figure 1.3. Notice that this particular category has 275 pages of free and paid apps at 20 apps per page! I'll do the math. That's 5,500 apps in the Lifestyle category (at the time of this writing). If your app manages to sell enough copies to make it into the top 20, you will see your sales climb dramatically (as long as you stay on this list.)
Figure 1.2 Top Paid Apps, Top Free Apps, and Top Grossing Apps are shown to the right of the App Store's home page.
Figure 1.3 Each category on the App Store has columns for paid and free apps.
You can also sort the apps within each category by Name (A–Z breakouts), by Release Date, and by Most Popular as shown in Figure 1.4. Searching by Name is helpful if you're searching on a particular name of an app or your best guess as to its name. Release date is the default. Searching on Most Popular almost always brings up a huge list of free apps. No surprise there.
Figure 1.4 The App Store allows you to search by Name, Release Date, and Most Popular within each category.
The App Store will continue to make improvements to help strengthen and refine the search process and showcase apps in the best way possible. After all, Apple has a vested interest in your success. The more apps you sell, the more they make. Perhaps more importantly, the more apps that are sold, the stronger the iPhone brand. Apple doesn't publish App Store sales in its earnings results, but it has commented on earnings calls that it is slightly above breakeven on the App Store. However, no matter what it does to improve the store, the challenge will always be the same for you: how to get your app noticed.
In order to create a winning sales and marketing strategy for your app, it's important to understand the dynamics of the App Store and understand that there are several strategies that you can employ. Most developers are trying to knock their app out of the park. They want the grand slam and think anything less is failure. A number of developers give up, thinking there's only two possible outcomes: the big win or no win. But, there are actually three possible outcomes: the Big Win App, the Steady Win App, and the No Win App. All apps fall into one of these three categories. Over time, and without marketing or product updates, all apps will eventually slide from one category to the next one below.
The Big Win—Grand Slam
The Big Win apps or Grand Slams are generally characterized by explosive sales from their launch. Games, by far, make up the majority of the Big Win apps. Why? Because games take advantage of the impulse buy which occurs directly from an iPhone. Games are the most likely app to be bought on impulse. The impulse buyer doesn't care about reviews. Sometimes, a community of people is familiar with a particular development company and is hungry to purchase its new app. Some companies have made their app successful by porting an already successful PC or Mac game over to the iPhone platform.
Big Win apps have been positioned by large development companies with huge followings. Their aim is to achieve quick sales on apps that are priced in the games sweet spot from $0.99 to $1.99. At this price point, the impulse buyer is looking for something to occupy his time. The longevity of this type of app may be short, lasting only months. Then the same company releases another app and focuses its attention on that. Some winning apps are designed in such a way to bring the customer back over and over again with paid add-ons or frequent updates. One of the most popular game apps to provide frequent releases is Pocket God shown in Figure 1.5. Pocket God refers to its updates as "Episodes" and has built a very strong community of users that keep the game in the spotlight. User suggestions for new features keep the game fresh and exciting.
Figure 1.5 Pocket God has done a very good job keeping customers engaged with its frequent new "Episodes," or product updates.
Another common element for Big Win games is that they are usually simplistic in their premise. The masses of iPhone users purchase games that are easy to learn. Low on learning, high on enjoyment is the rule of thumb for the quick win Big Win games. The typical game buyer doesn't want to learn tons of rules to a new game. They want to understand the point of the app immediately.
The Big Win apps can also come from independent developers (Ethan Nicholas of iShoot Fame) whose military tank battle game is a classic example of independent developer success. However, the big wins for independent developers are happening less and less due to the number of games on the App Store and because game quality is going up while the time to market is going down. Larger companies have the development staff that can bring apps to market more quickly without sacrificing quality. It simply takes an independent developer longer to create a high powered, high quality game app. iShoot continues to do well, although its sales are not as strong as they used to be. However, once a following is created and the app is updated frequently, you will continue to attract customers and positive reviews as shown in Figure 1.6.
Figure 1.6 Positive reviews continue to roll in for the infamous iShoot App.
The last characteristic of these apps is that they often get a big break from the press as being an app to look at. Tom Clancy achieved remarkable success with his book Hunt for Red October when Ronald Reagan praised the book after he read it while on vacation. After Reagan's comments, sales of that book skyrocketed. If an iPhone/iPad app gets a lucky break from a major news agency, it can serve as the catalyst to get sales moving in a big way. Word of mouth takes it from there.
Some other apps that fall into this category are shown in Figures 1.7 and 1.8. These apps have achieved phenomenal success. Flick Fishing continues to stay on the best seller list due to its amazing graphics, simple play premise, and huge following. Koi Pond also hit the mark with its relaxing and amazing graphics, and, according to its developers, being in the right place at the right time when the App Store was launched. And who can forget Bejeweled and Bejeweled 2 shown in Figure 1.9.
Figure 1.7 Flick Fishing has achieved Big Win success with well over 1.3 million downloads. They also offer an add-on pack for additional play, adding to their revenues.
Figure 1.8 Koi Pond achieved early success with its incredible use of graphics and simple premise of design.
Figure 1.9 Bejeweled is the runaway best selling game from PopCap Games, Inc. It is on Apple's Highest Grossing App list.
The Steady Win—Base Hits
The next category of iPhone/iPad apps is the Steady Win, also known as base hit apps. This category may be overlooked by some app developers who focus solely on the Big Win. The majority of new iPhone/iPad apps land in this category even if the developer has intentions of his app making it into the Big Win group. These apps rely on app reviews, positive blog posts, and making it onto the App Store's "wall of fame" where the app is placed in the "New and Noteworthy" of "Staff Picks" sections for a time. These placements are definitely helpful and will boost sales noticeably while you remain on that list.
These apps also rely on good, old-fashioned, consistent marketing. The revenue with this type of app can be more predictable when the seller understands what marketing activities work for him. With a good app, the right marketing mix, and product updates, your app can achieve success on the App Store. It may not be multimillion dollar success, but it can be decent. It may be enough to compel you to write multiple apps, build a brand, and truly make a business out of your efforts.
Some apps that have achieved solid success that are not necessarily iPhone games are shown in Figure 1.10 and Figure 1.11. These apps have been achieving a steady revenue stream for their developers albeit not millionaire levels. They have strong value propositions and their products resonate with their intended audience. These apps are focused on saving money and getting healthy, topics that interest almost everyone.
Figure 1.10 Save Benjis is an app that allows you to do price comparisons. They also offer an up-sell to their product, a newer app with the popular bar-code scanner feature.
Figure 1.11 iFitness is a long time selling app that helps you track and learn how to do more than 200 exercises.
Since most apps fall into the category of Steady Win, the bulk of this book is focused on helping you achieve ongoing success through a complete marketing approach. These apps generally command a higher selling price and can have more predictable revenue streams. Independent developers will most likely be playing in this category whether they realize it or not.
The No Win—Strikeout
Sadly, a large number of apps on the App Store are DOA. After working months and months or paying someone else to write your app, you post the app to the App Store and anxiously await its review and approval. After a few weeks you get the word back that your app has been approved. The app is posted within a few days of approval and your expectations soar! You can see the checks rolling in from Apple. You've already bought the swimming pool (remember Christmas Vacation). Then, you wait. You check your sales stats. A few sales here, a few sales there.... What has happened? Where are all my buyers? What happened to the 10,000 downloads overnight? You thought people would be breaking down the doors to get at this new app. You are discouraged and think you've wasted your time. You've probably thought about dropping your price. Surely there must be something wrong with the App Store to cause this.
Sometimes, even very well written apps end up unnoticed and ignored. An app that sees 0 or 1–2 sales a day is not going to cut it to reach your break even. At the time of this writing, there are almost 12,000 apps that are inactive and no longer for sale on the app store. So, what does a person do who finds himself in this predicament where his app is not doing well? It's time for a total app makeover. Ask yourself the following questions, and be brutally honest:
Is there really a market for my app? Did you come up with your app idea while sitting around with a bunch of friends and thought you had stumbled onto something that was incredible? Or did you do some solid competitive research to see if there were similar apps already posted, especially in the Free category? Nothing wrong with creating a competing app if you can make it better, but it's got to be better! Often, whenever we think we have a great idea we need to really analyze whether it's viable or not. Ask some family, friends, or coworkers if they would be willing to pay for such an app. Find out if you have a market (and its potential size) for your app before you start coding or launch into an expensive project with a developer.
Is your app extremely well written? A number of apps on the App Store are poorly written. They have bugs or some of the features don't work. This is a surefire way to get a one-star rating on the App Store by a disgruntled buyer. Even at $0.99 people will take the time to point out that your app is crap and not worth the money on the customer reviews. One of the outcomes of competition is that prices fall and quality goes up. Customers expect an app to work just as well at $0.99 as they do at $29.99.
Have you done any marketing? As we will mention time and time again in this book, marketing is not posting your app to the App Store. You've had your app approved by Apple, and that's a great accomplishment. Now the second half of your work starts. Selling iPhone/iPad apps is not a passive activity if you intend to make money at it. A few other questions to consider: Does your app's icon convey what the app does? Icons that don't convey what the apps does or at least what category the app is in are missing a marketing opportunity. Does the name of your app communicate the value of your app or help tell the story of what it does? Does your web copy match your product website in terms of crisp well-written content? All of these things combined help you to tell the story of your app and communicate its value. Figure 1.12 shows some sample icons that do a good job of communicating their value.
Figure 1.12 These icons communicate very nicely what the apps do. This is an important part of your overall marketing.
Taken together, these three components are the pillars of your app's success as shown in Figure 1.13. Failure to address all three of these areas well means the likelihood of your app succeeding in the market is slim. I know there are stories of some apps seemingly not addressing these areas and yet achieving wild success. There are always examples of people achieving success in books or movies that, for some odd reason, defy all understanding.
The same goes for iPhone/iPad apps. But, even the successful apps that achieve (perhaps) undeserving success have done at least two of these three things right. They definitely have a market for their app, regardless of how stupid or pointless their app may be. They may claim to have done no marketing, but word of mouth (a form of marketing) has propelled them to success. There is never an explanation why an app is not successful. The answer is always there with a little digging.
Figure 1.13 Three pillars of iPhone/iPad app success: a market, well-written app, and deliberate marketing.
If you should decide that your old app should rest in peace, at least you have a better understanding of what you can do the next time around to help you achieve success. Don't kid yourself when you answer any of these questions. If you truly believe you have a great idea for an app and you've done your homework, then go for it. If you have written a great app and know it without a doubt, then apply some marketing and get those sales moving.