Blog Post

Cold Hard Truth of the App Store

The design of Apple’s (s aapl) App Store has been receiving a fair bit of criticism from both developer and customers alike. I’m not here to rehash all of that, but rather, to point out the results of a pricing experiment that App Cubby founder, David Barnard performed.

To give a quick backgrounder, a few weeks back David decided to run all of his apps for 99 cents and let users donate what they thought the apps were worth after using them for some time. Well he’s crunched the numbers, and has now posted his thoughts on the experiment.

It’s a great read, and I definitely suggest you check it out in its entirety, but here’s the quick look. Essentially, Barnard has come to the realization that for the most part, the well thought-out and well-developed applications tend to be somewhat niche in nature. These apps are a gamble in the current iteration of the App Store, and represent the developer’s love for his craft, more than a realistic expectation of getting rich from the sales.

While the realities of the experiment may be a bit sobering (not just to David), App Cubby will forge ahead. David has decided to continue to support his well-crafted ‘Cubby apps, release near-term updates as well (as Lite versions for free evaluation), and price all three (Trip, Gas, and Health Cubbys) at $9.99. These steps may seem drastic, but he’s identified his audience and doesn’t care to scrimp on his design goals. A read of his post to see what the road map for App Cubby looks like are surely in order whether you’re a developer of potential customer of App Cubby’s.

David’s next steps seem bold, but clearly he has his customers in mind, as he’s considered the transition from Lite to Paid, with regards to bridging the user data. As I said when I profiled App Cubby a few months back, the prices may seem steep, relative to the rest of the App Store, but David knows the audience he’s targeting, and believes in his product. I think that’s a great stance from a solid developer.

The other side of this coin represents those developers who aren’t willing to duke it out, and turn out the kinds of apps they are truly passionate about. Many a great idea, as David relates in his post, may go unrealized in place of apps that produce a quick laugh but no utility. I’m not sure I fully believe this stance, as there are a lot of young, hungry, talented developers out there who will likely try their hand at the App Store. Their early attempts may be used as the trial from afar by more experienced and proven developers, or just maybe they’ll nail it themselves. Either way, I do agree that the current state of the App Store definitely has its flaws which will make it a longer, more difficult process for the great iPhone and iPod touch apps to shine. But until that changes, I wish David and other great developers like him, good luck as they forge ever forward in their battle to develop and sell quality applications.

6 Responses to “Cold Hard Truth of the App Store”

  1. @ Galley:

    IMO “well-designed” is a baseline that is to be expected in any app I use, so in a sense well-designed is not worth anything at all. The utility is the important thing and an app would have to be truly very, very useful to me to be worth $9.99. I’m not sure at this writing what the appCubby apps are, but in terms of utility $9.99 would leave out pretty much any game or one trick pony etc., and would have to be something I use almost every day for a long period of time to be worth it.

    I have yet to read the original article, but if the summation here is correct, this developer might have spent a lot of time just to identify a “sweet spot” of people who are rich enough (or foolish enough?), to pay a high price for his work. If the people likely to need or purchase the app were depicted as a cloud he might be just drawing a circle around the densest part of this cloud. This is not the same thing as saying that this is his audience, or the sum total of folks that need/use the app, or indeed would pay something for it. It’s just a description of the group that would pay what he wants them to pay or who agree with his assessment of the intrinsic worth of the application.

    I can see how this is very helpful to him, but I don’t immediately see how this is really helpful for his potential customer base, developers in general or is a particularly deep or insightful analysis.

  2. Gosh… there are plenty of devs making money from the Appstore! And there are plenty of those that dont, so what? there are companies that make money and there are those that dont, its a fact of life, go study marketing…
    Product, Placement, Price, Promotion… all you care about is Promotion…

    Have you thought that maybe its not promotion’s fault or the other 99c apps?
    How can you blame the other 99c apps? There are comparitively very few 99c tracker apps, there are way more fart apps, and they seem to be selling very well.

    SO the only conclusion, maybe very few people are interested in milage/budget trackers? I really dont care how much my car guzzles.

    So now you gotta think, keep the price point at 10 bucks, or lower it to 99c and try to get those impulse buyers who really wouldnt use your app in the first place to click the buy button.

    Theres only so much promotion can do… you keep blaming promotion, apple not putting your app in the hot list, magz not reporting and sales go down, well duh…
    Thats why you pay for them.
    And thats why sometimes cruddy product sells.

    What I suggest is, instead of putting more money, complaining and mulling over these tracker app, go make a game, or make a fart app…
    Which brings me to the other concept of marketing, the 4Cs…
    one of them is CUSTOMER…

    Find out what your customer wants!