We have spent a great deal of time working with mobile app publishers, developers and marketers on optimizing the price of their paid apps in order to maximize downloads and revenue. Here are our key rules on developing your own price marketing strategy:
- Repeat Frequently: All paid apps should look to go on sale, on average, at least once per month. With the corresponding price increase, that makes 24 price changes per year. More experienced app developers and marketers can look to do more to maximize downloads, including intraday changes to target specific countries or types of users, but 1 per month is a good start for most apps.
- Allow Settling Time: Price changes can take anywhere from 20 minutes to more than 15 hours to spread throughout iTunes’ storefronts (New Zealand is usually one of the first then it follows time zones to reach European storefronts and the US). In addition, it can take time for users to discover the new price, either directly or through a third party site like AppShopper. So unless you are looking to make multiple price changes a day, which is rewarding but requires constant attention and/or the right tools, most publishers should let their app’s sale breathe for 48 to 72 hours.
- Focus on Down Cycles: Given the cyclical nature of downloads and ranks, price changes should generally not be made when the app is experiencing a growth spurt. Instead, the price change should be timed with an app’s slowing downloads or sagging rank.
- React to Competition: If your app is a soccer app at $2.99 and EA’s FIFA 2014 goes from $4.99 to $0.99, you need to react immediately, in order protect your positioning and sales. If this example does not directly apply to you, remember that competitors are not just direct competitors. They may also be apps ranked just above you in your genre or category, or those appearing before you in key searches on iTunes.
- Avoid Predictability: Varying the times, days of the week and the amounts of your price changes will avoid predictability that could be gamed by both competitors and users.
- Test Often: Every price change should be an opportunity to test a new price and new price steps. That may not always be possible if you are at $0.99 and going free. But even then you should be testing various target prices (the price you go to after a sale). Here are examples of variations in price changes:
- The price of your app is lowered to varying tiers in 1 or 2 steps (e.g. $3.99 -> $0.99 or $3.99 -> $0.99 -> $0.00)
- Then the price is increased in 1-3 steps (e.g. $0.99 -> $3.99, $0.99 -> $4.99 -> $3.99, $0.99 -> $1.99 -> $3.99)
Pricing changes are a simple, effective way to get your app in front of people. You can make these changes yourself, or if you’re looking for some extra assistance, let us know.