Thursday, July 21, 2011

Developing Effective Multi-Store App Pricing Strategy – Free Report By Research2guidance

From Research2guidance

Average best-selling application prices vary greatly in different stores.

Berlin, July 21st – Mobile app developers nowadays face new challenges regarding the distribution of their apps such as setting a price for a download, comprehending the individual needs of their potential customers and the market of online stores.

Developers can take advantage of existing users’ willingness to pay more for apps in these stores. Our research shows that there are applications that cost a significantly higher price in independent app directories, compared to the original MNO stores.

The latest edition of our free “Android Market Insights” includes a comparison of alternative stores for Android application distribution. It shows that full-catalog stores have a much higher average price for their best-selling apps, whereas prices and users’ willingness to pay are much lower in Android specialist stores than in the Android Market.

Interestingly, the average price of Top100 paid apps in Android Market is twice as high as the overall average selling price, US$6.47 compared to US$3.07 in June 2011. This means that many users do not mind paying a substantially higher price for what they think is a good application.

Similarly, developers should not overlook pricing trends within different app store categories. Users would not pay more than US$1.50 for a ringtone, but they do pay US$4 for a book in the Android Market. Furthermore, users of independent stores pay as much as US$11.56 for best-selling books. Clearly it makes sense for developers to take a deeper look into the user habits of different app categories. Selecting the right category in the app store, with potentially a higher price, could create higher revenue streams.

There are two dominant types of independent stores where developers can alternatively submit their applications:

Full-catalog stores: independent stores that provide applications for all major mobile platforms, including Android, BlackBerry, Symbian, Windows Mobile, etc. Notably, full-catalogue stores are the incumbents of the app market, some having been launched way back in 2000. Back then the average app selling price was as high as US$20, with very few apps being given away for free. We have found that users of these stores are more accustomed to the idea of paying for apps, and the stores themselves are generally more focused on improving developer monetization opportunities, and offering a range of additional app promotion options, particularly when compared with MNO stores.

Platform specialists: niche stores concentrating on the distribution of applications only for a selected platform. These stores are relatively young, and only came into play within last two years, following the Apple App Store paradigm shift. They promote interaction among developers and users in their forums and offer lower average prices of Top100 paid apps than full catalog stores.

Developers should create individualized business models in terms of pricing, distribution, special promos and content in order to benefit the most for themselves and their clients. Some stores are better at distributing free applications, some are better at highlighting discounted apps and special promos, while others work best for high-priced, high-quality content.

Please take a look at new research2guidance report “The Market For Mobile Application Development Services: Selling The Spades For The App Gold Diggers”, released in July 2011.

Free Android Insight report: Download the free monthly report here – “Android Market Insights (June, 2011)”

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research2guidance is a Berlin-based market research company specializing in the mobile industry. The company’s service offerings include comprehensive market studies, as well as bespoke research and consultancy.

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