PRICING STRATEGIESPRICING STRATEGIESPRICING STRATEGIESPRICING STRATEGIES

COMPETING AGAINST FREE APPS

•If your app does more than free app, you can charge

•Free apps can (yours or another) drive sales

•Free app as an introduction, charge for more advanced app

•Best to keep free app free and develop a paid version

Pros ConsBuild brand name & a

followingLots of ads

Customers look for free first then buy

Charging after offering free apps.....downloads drop

dramatically Build free apps to

showcase your skills for your app development company

You may never get customers back

Build a free app to support other products you are selling

Difficult to maintain two apps: paid and free

The more free downloads, the closer to getting in the

TOP APP CATEGORY

TOP APP CATEGORYCATAPULTS SALES

FREE APPS

PAID APPS

Pros Cons

Best for tech and business categories

Not enough revenue to sustain business model

Customers are more willing to pay for apps that solve a problem

Buyers are not price sensitive up to $14.99

Strategies•Build free and paid apps simultaneously - establish following from the start - get sales along with free downloads•Conversion rates from free to paid is 1% - It takes a 1,000 free downloads to generate 10 app sales

•Make in-depth app for a fee and disable features for free app

Some free apps generate thousands and thousands of downloads........

Potential for revenue can be huge!

Strategies

• Accurately and strategically describe your app with keywords....to facilitate searches

• Create a catching icon..... Think about memorable logos.....

• Use search engine optimization techniques so you get top listing

• Get other sites to link to your site• Link to complementary sites• Issue press releases

• Make your app easy to use• Use professionally designed graphics• Create tutorials• Provide some technical support-- online chat

tech support....• Develop good reputation for customer service• Go viral......

Strategies

Pricing Misconceptions

•You see a lot of downward pricing pressure on App Store and think you shouldn't price your app too high

- Many apps are selling 2 to 4 times the .99 price

point•You think customers will only pay .99•You think pricing at .99 will help you make it into the top 100 sales category

•You think lower prices will attract thousands of buyers even if they have no use for it

• Adopting any one of the mindsets or dropping your price too soon will result in lower revenue

•Many apps are being sold at two to four times .99 price

•Base your price on the time and money you put into it and the size of the buying market

•At .99 there is no guarantee that you'll make it into the top 100 apps category

•Making it into the top 100 category gets more difficult by the day as more and more apps are added to the store

•Be patient--it will take time to build a brand and start making money

Setting Your App's Price

Price high initially and measure results....pick the high end of a price range....have the features to justify price

Research price range in your category and price yours somewhere in the middle

Price low and make it up on volume

BREAK-EVEN ANALYSIS