I have been reading some articles and thinking recently on the popularity of iOS applications. Most smartphone or tablet users can agree that iOS has built a very stable backbone for the future. Mobile software developers are constantly working harder and harder to churn out good products. But at what cost is this affecting the App Store as a whole?
While more people get into the market by releasing apps for free, or just undercutting competitors, there is a growing distance to capture large bases of customers. Many people are still happy to pay for apps but often under $5.00. Lots of fullscreen iPad apps or games will charge more, but how many of these applications are truly catching attention or dramatically improving our world?
The Growing Expansion
Smartphones and the iPhone especially are granted more power through the use of applications. Any device with Internet access to download applications may now extend the default functionality with the help of developers around the world. This also brought in a new wave of startups which were built on the sole idea of users becoming the product, leaving almost no room for customers.
A recent article from this past April on the value-shift in iOS apps brings up many similar arguments. Free apps have almost turned into startups in their own right. Not saying this is completely unwarranted – I mention ideas like Vine and Directr which are pushing the limits of modern technology. But with teams of people all fighting for this startup dream it creates a bubble much like we see in the global economy today.
But instead of a looming debt-bubble, the app store is facing an already-bloated product bubble. Founders can showcase the download stats and user acquisition numbers all day but if the app is free, how will it make money? There are some wrong answers to this question but also plenty of right ones.
Consider charging users for in-app purchases, or even selling a pro version with more features. Recurring subscription fees would also be an option. There is no bad reason to release your application for free. But why not charge something for all your effort? Especially if you think that users would be willing to pay.
Using a Price Tag
It is completely fair to state that some applications should be released for free. A developer may want to test the waters and simply doesn’t feel their first release is worthy of any price. The point is that there will always be free applications and it is senseless to fight against the market.
Instead plan out solutions for your ideas before even coding them. Think up a business model and more importantly a revenue model which could work. Flow is a good example where the iOS application is free to download, but in order to keep your account active it will cost a monthly fee. There are more than just a few ways to earn money in the app marketplace, so brainstorm ideas when you have time and what you come up with may be quite surprising.
The reason a price on your mobile software is so crucial is because of perceived value. Customers assume that free applications were released to build publicity, or because the developer feels they are not worth charging for downloads. When people see a $9.99 application there is a perception that this software may be worth $10. Regardless of your total downloads, it will show just how many customers are willing to buy your product at a certain value.
The iOS store is full of people who use an Apple account and might leave money in there for downloading new music or movies. It wouldn’t be odd to assume these same people may be willing to shell out a bit of cash on applications, too. Find that perfect line between value and price to officially determine how many users would be willing to pay for your product.
A Possible Solution?
Another Medium article published in September brings to light a new solution to pricing applications. The point is made that iOS apps are software regardless of limitations in screen size or functionality. Buy nowadays we can just download software instead of purchasing the physical installation disc. Unless you plan to build freeware this concept is worthy of scrutiny.
The basic premise is to release each new application at the $0.99 price. Each day the price will rise higher until we reach a day with no sales. Then the price is frozen, statistics are measured, and a new average is determined based on fair market value. Basically we let the consumers in the free market decide what they are willing to pay for mobile software.
It provides a chance for early-adopters to download your app for $1 when it could raise up to $10 or more in the future. Those who are looking for a free solution will probably go looking elsewhere no matter what you do. This methodology can truly get developers motivated, providing value to your customers while also paying your own bills.
I am certainly not predicting any future events but I do love to analyze market trends. I have been toying with Objective-C for many years now. Paying the $99/year entry fee has been my personal deterrent from releasing any official applications. Apple takes a good portion of the earnings for each sale along with the licensing fees. I just see a huge market dominance which is going to be tough to break away from. How things may go 2-3 years from now I truly can’t say with accuracy. But I will be watching closely along with other curious mobile app developers.