How to make money on the App Store

Despite what you may think, one do not need to be a computer geek or programmer to create an iPhone app and make money from it. With reasonable commitment, anybody – from the absolute beginner to the the aspiring entrepreneur on a shoestring budget – can easily build simple and functional apps for the iPhone, iPad or iPod Touch, and still make money from it.

 You've made a fantastic iPhone and iPad app. What next? In this article we discuss the various strategies you can use to market an app successfully on the App Store: how to get to the top of the App Store charts, how to sell more in-app purchases, and what price you should set for your app. We even discuss the problem of app cloning, something that afflicts every successful iOS app.
iOS development and marketing is a tough gig, make no bones about it. Recently a number of devs have revealed their revenue and cost figures, and it's become painfully clear that small indie devs, the lifeblood of iOS innovation, face a huge battle edging out the larger software companies and their swollen marketing budgets. (We discuss this in Why Apple should pay more attention to indie developers in the App Store.)

But don't despair. Small app developers can make good money on the App Store, provided they've got a great app, a strong marketing strategy and a bit of luck. We'll do our best to help with the second of those in this article - and big app developers may learn a thing or two as well.

How to get your app approved by Apple

We'll assume you've designed a great iOS app. (Easier said than done, obviously! For help getting started on that path, take a look at How to get started with Apple's Swift app programming language and Best Mac for app development) So get reading - but expect headaches anyway. But the first step on the road to marketing your work successfully is for some developers the most intimidating: you need to get your app approved by Apple. Which means treading carefully around Apple's curatorial restrictions: sex and religion are mostly off limits, for instance. Francesco Zerbinati, an Italian indie app developer, found the approval process relatively painless, but stressed to us the importance of doing your preparation and striving to understand Apple's rules and regulations.

You need to take this part of the process just as seriously as the design of the app itself. "First, I read the iTunes app review rules before sending my app," he said. "Then, when the app got reviewed the first time, it was rejected because in the screenshots there was an image of a Kindle (it's called Price Radar - you use it to monitor price changes of Amazon items). I had to re-upload the screenshot images and wait another 7 to 10 days for the review to be completed. It was the only time my app was rejected. "I would recommend to any new dev to read the rules very carefully."

A key part of app marketing is cracking the App Store charts (charts that show which apps are shifting the most downloads, or making the most money). Enough people download apps on the strength of an appearance at the top of the charts to make this largely self-sustaining: you get to the top, you pick up lots of new users, and this helps you stay there, at least for a while. This is why so many app developers will do anything to get lots of downloads when their app launches: price promotions, paid-for adverts, everything they can think of. But which technique is best, and are they worth the effort? Jonah Grant was 13 when he developed his first mobile application, Pong, a homage to the original video game from Atari.

Two years later, it’s not on the app store any longer, but that hasn’t stopped him from developing. Now a freshman in high school in a Chicago suburb, Grant has recently added “BookYap,” a book recommendation app, to his growing list of iPhone/iPad apps on Apple’s App Store. He’s gotten so much experience developing apps on a whim and for practice that companies are now approaching him to design their apps for them. While many of his own apps are free, he’s learned enough to help solve others’ app design problems. Out of his 5,000-student high school, he knows only one other student who dabbles in apps, but Grant has more experience. And he’s learning how to make money with iPhone apps.

 

Here are others under his name:

• Walkie-Talkie 3000 – selling for 99 cents, this app turns your iPhone and iPod Touches into a walkie talkie using the devices’ Bluetooth connections for all of your secret missions.
• Commandments – the original tablet app offers the original tablets – the 10 Commandments from Moses – for your iPad. “At the end of the day, the iPad is a tablet. It’s the latest in a long generation of tablets. All these cool apps are flowing out of the app store. Why not try out the first-ever tablet,” reads the promotional wording for the app.
• Balloon Popper – fly into the sky: For 99 cents, pop balloons floating in the sky and send them back to earth. “Minimal, yet entertaining,” reads the app’s description.

Grant learned how to develop code by playing around with sample code online, and meeting people online who could teach him things or help him when he had a problem. He said his app ideas on the app store now were mostly developed on a whim, although he’s done some comparison to see how he can improve his own. He charges for apps depending on how long it took to make and who he thought would be buying it.

The apps he’s developed for both himself and clients have been downloaded more than 300,000 times, he said. “It’s really not that hard. Set a price, give the app to Apple and the next thing you know, money is flowing into your savings account,” Grant wrote in an e-mail interview. While apps have always been around in one form or another – on the computer, the web and now on mobile devices, Grant has some advice to those interested in learning how to make an iPhone app that will make money or be successful on mobile devices.

1. “Think mobile. Your user doesn’t have a lot of space on their screen. Don’t overload the user with information, and don’t waste space,” Grant wrote in the e-mail interview.
2. “Speed. In this day and age, lagging and crashes just aren’t acceptable. You need to make your software as speedy as possible,” Grant continued.
3. “Beauty. Please, please don’t make your apps’ user interface look straight out of Windows 95. Invest in a good designer and make a piece of art.”

The In-App Purchase

Another popular option for making money with iPhone apps these days is what’s known as the “in-app purchase.” This method is becoming the dominant way that new developers are using to monetize apps, said app developer and author Dave Wooldridge in an interview. “It enables developers to offer a true try-before-you-buy model,” said Wooldridge who is author of “The Business of iPhone and App Development: Making and Marketing Apps that Succeed” as well as the founder of Electric Butterfly (www.ebutterfly.com) that specializes in iOS app development.

Free apps get you downloaded onto many more devices, and then the more they like it, they’ll want more features, he said. “It’s a much more convenient and seamless user experience than the older free Lite and Paid versions scenarios,” Wooldridge said. There is a programming challenge associated with using in-app purchases to make money with your iPhone/iPad apps.

It requires learning how to use the Store Kit framework in your iOS app, he said, adding he explains that process in his book. “The extra consumer convenience and sales/marketing advantages it (the in-app purchase feature) provides far outweigh any development burden of implementing it,” Wooldridge said. Advertisements Another way that you can make money with your iPhone/iPad app is through advertisements.

Through Apple’s Software Development Kit, or SDK, Apple offers what’s called the iAd Network, which is a network from Apple that does the advertising work for you. Although you run the risk of alienating users who don’t like seeing a lot of ads on the apps that they’ve paid to download, it is another revenue stream when you’re trying to make money with iPhone apps. A lot of app developers, like those behind the popular Words With Friends Game from Newtoy, Inc., offer free versions of their apps which come with ads. Then, users enjoying the free apps but tired of ads popping up can opt to buy the full version without any ads.

 

A Passion For Your App

However you decide on how to make money with your iPhone app, don’t create apps just because you think it will earn you some cash. “Create apps that you’re passionate about,” Wooldridge said. “The best apps are ones that reflect a true commitment and attention to detail from the developer. 

Take the time to craft a truly beautiful app! No amount of marketing can help sell a bad app.” Our indie dev contact Zerbinati managed to briefly get his app to the top of the Spanish App Store chart, and made the Italian top ten. But his experience is interesting for the things that didn't work just as much as the ones that did. "First: Facebook and Twitter ads don't work if yours is a paid app," he told us, "even if it costs less than a euro: they click on the banner, you pay your commission for the click, and they see that it's a paid app: they will not buy it.

A better option is promoting your app on specialised blogs with reviews and articles: when actualidadiphone.es (the biggest Spanish iPhone website) reviewed my app it went into the Spanish chart and stayed there for 10 days. "Climbing the chart, from what I've seen, depends on the number of downloads in the fraction of time.

If you get 100 downloads in one hour, you'll probably be top of the App Store in the next refresh. So, what's relevant isn't just the number of downloads itself but the period of time in which the downloads are made. "When you're top on the App Store, people will see your app and probably download it again, and you'll stay on top, even if your download rate is reducing. I don’t know why, but I noticed that it was like a boom effect climbing and then, even if the downloads where reducing, we stayed on top."

What price should you set for your iOS app?

The brutal reality is the vast majority of iPhone and iPad owners will go for free apps over paid-for ones, even if the difference in price is only a couple of quid and the free app is significantly shoddier. There are so many free options in so many areas of the App Store than it's exceptionally difficult for a paid-for app to compete with the freebies. (One exception I can call to mind is iPad ports of popular board games - a market in which brand names count, and where users are accustomed to spending around five to six quid on a game.

I think paid-for apps do okay in the satnav market, too. But most other app genres I'm aware of are heavily dominated by freebies.) So best to go for a freemium model, then? Not so fast. Here's a second brutal reality: the vast majority of iOS users that download any given free app won't go near the in-app purchases (IAPs). Let's take an extreme example of IAP take-up:

Monument Valley. That's actually a paid-for game, so all the people downloading it have already shown themselves willing to spend money on digital content. It's also a very good game and quite a short one - those two factors together encouraging players to shell out to keep it going a bit longer. And yet, with everything in its favour, its IAP uptake was around 5-6 percent: 575,608 out of more than 10,000,000.  

For the average free app, the percentage will be much lower than that. Last year app testing firm Swrve reported that over 60 percent of free games' in-app purchases came from just 0.14 percent of players, and that only 1.4 percent of players spent any money at all. Going free-to-play (F2P) has other consequences, too. For one thing, in order to persuade users to buy the IAPs, you'll probably have to compromise the integrity of your game; most F2P games do, at any rate.

We'll discuss some of the methods you can use to steer users towards the IAPs in a later section, but they nearly all have a dubious effect on what I'd call the quality of the experience. Do you want to make a good game, or do you want to make a lucrative game? It's not a nice choice to have to make. I addressed this in a rant back in 2013, and the situation has if anything got worse since then: Freemium is the worst thing in the history of gaming: a rant. If you decide to go for a paid-for rather than free initial download, you'll probably be looking at a low price tag in order to increase downloads. But this isn't always the best solution.

 

Francesco Zerbinati described to us the curious findings of his own pricing experiments. "I've noticed that 0.99 (the lowest price in euros) is not always the best choice if you need to reach the user mass," he explained. "When I released PriceRadar its price was 0.99.

The downloads where fine, but I thought I could make more money. So, I moved the price to 1.99. "Here came the surprise: I sold more than twice than before with this price in an equal period of time. Answer to that? I thought that, since PriceRadar is an app for Amazon power users and its target is users that buy a lot on Amazon and would like to save some money, the higher price was a mark of quality.

Previously, with the lowest price level of other cheap and crappy apps, it wasn't considered." That might be an unusual case, but it does highlight the importance of thinking laterally, and of experimenting with the price of your app. In some cases increasing the price may reduce downloads, but the greater profit per download may be enough to offset this. The best way to find your app's sweet spot is to experiment. 

What about a higher price tag - something we'd describe as premium? When we wrote about app pricing last year, we spoke to Rob Clarke, PR and marketing manager at Curve, a company that launched its Stealth Inc app at £2.99. "We're new to the App Store as a publisher," he said at the time, "but I think we got the price right. We stuck with a premium model because we feel that freemium games only really work if that's your goal from the design stage, and we're glad to see there's a healthy appetite for premium titles that have a fairly 'hardcore' appeal on the store.

 

 "We didn't feel the need to join the sort of 'race to the bottom' prices you see on the App Store, but at the same time, we didn't want to be charging £4.99, and it seems to have worked out for us!"

What I would view as a premium price tag is a lot higher than £2.99, although it's a rare developer that ventures into this territory. But the Baldur's Gate roleplaying games have tried their luck and seem to be prospering. Trent T. Oster, director of business development at Baldur's Gate publisher Beamdog, put this success down to brand recognition, as well as to the quality of the games.

"We've been lucky," he says. "By bringing such well known games as the Baldur's Gate series to the iPad we managed to get a great deal of attention despite our 'premium' price of $9.99 for the first game and $14.99 for the second [£6.99 and £10.49 in the UK at the time; now both Baldur's Gate I and Baldur's Gate II cost £7.99]. We've moved down in the standings since our launches, but the initial attention got us into the top 10 and was very positive for sales. Our subsequent sales were strong and now we're settling down."

 

How to improve your app's search visibility

Search is a mature, sophisticated field in the open web, and the old silly tricks - keyword stuffing, unreadable repetition, link farming - won't get you anywhere any more. If you want to do well on Google, you just need to write good articles that people want to read. There aren't any shortcuts. 

But App Store search is a long way behind. Run a search for the name of a popular app and you may well see that app appear top of the results - but it'll be followed by a mess of unrelated rubbish that stuck the established brand in their keyword fields and got away with it. And this in a market that Apple curates. Here's an example. I was looking for the iOS version of Ghost Stories, a rather nice board game. So I searched for 'ghost stories'.

 

 Discounts and sale prices

Curve's Rob Clarke warns newcomers to the app market to think about future promotions and sales prices when determining their starting price. "Our best advice for developers looking at making a premium title is to be aware of the lifecycle of your product," he explains. "It's a bit of a corporate-sounding word, but one mistake we see people making on the App Store and other open-ended stores like Steam is they price the game too low right from the start and then find they don't really have many options for promotion.

 "You're going to be doing a lot of different promotions and sales in the future, and you may even get featured in an Apple sale. It sounds obvious, but say 50 percent of £3.99 is a lot more than 50 percent of £1.99. Pricing is always really tricky, but remember: while you can always easily permanently reduce your game's price if it's not working for you, it's hardly ever a good idea to permanently raise one." So there you have it.

It's easier to reduce your price in future than to raise it; and it's not impossible to make a go of it with a higher-priced app. (And it's not a cakewalk in the free-app market.) The 7 most expensive in-app purchases And here's a final reminder that prices on the App Store recently went up, apparently in response to VAT and currency fluctuations. The lowest (non-free) price is now 79p, not 69p.

How to sell more in-app purchases

We'll deal with this only briefly, because the subject is too depressing. Much of it reads like the villainous musings of a mad scientist locking iPhone owners in a giant Skinner box. But here are five tips for IAP pushers: 1. Waste people's time, then sell it back to them. This is the classic (and most irritating) of the F2P strategies, but it seems to work. Make a game that's fun, and then impose artificial delays. "Want to skip the wait? That'll cost you 20 fun coins!"



 

2. Learn the value of curiosity. Many F2P apps black out or otherwise obscure some of their higher-end unlockables until you reach a certain point in the game, thereby increasing their mystique and perceived value.

3. Make more expensive bundles of IAPs a 'better deal'. Pay 79p for 10 fun coins. Pay £2.29 for 50 fun coins. Pay £3.99 for 200 fun coins! Watch the money roll in. 4. Give half a story away for free, then end on a cliffhanger. A lovely adventure game called The Silent Age uses this technique: it's free, and you get to play a solid half of the game without paying a penny. By the time you hit the paywall you're hooked. (I don't count this as an evil technique.) The similarly named Broken Age is doing the same sort of thing, only you pay for each instalment separately. Needless to say I'll be downloading part 2 as soon as it appears.

 

5. Get rid of the clock. This article has some great (evil) tricks, but this is the most depressing of all. Like a Las Vegas casino, a clever IAP-selling app will hide the clock: in other words, removing the status bar and its clock so you don't realise how long you've been playing.

Right, that's quite enough of that. (Okay, one last one: 10 tricks that apps use to get your money.) What other ways are there to publicise your app? Next we're going to talk about reviews, and dealing with the media.

How to get your app reviewed by the media

One of the best ways to get publicity (and downloads) for your app is to get it reviewed in the media. But that's easier said than done. Speaking as app reviewer, here are my tips on dealing with the media:

1. We are emailed about hundreds of apps every day. Which makes your task a little bit like grabbing users on the App Store: you have to assume that your email will get only the briefest of glances. You need to grab the reader from the subject field - don't assume they'll even open the email.

It would be nice to put 'Review request: [name of game], a [genre of game] that [reason why it's amazing]', but that's unlikely to fit. If you've got a recognisable brand name, I'd suggest something like 'Infinity Blade 4 review codes available!' If not, just put the name of the app and why we should care about it. The most recent review request email I've had has a subject line of 'Review request', while the first line of the email (which is visible in the preview pane) is 'Hello, I am writing to request an App review for my application'. None of this tells me anything, or convinces me to open the email.

This is how first contact looks from the point of view of a journalist. But I spoke to Ben Camm-Jones, a former colleague of mine who moved from journalism to PR and who has seen this game from both sides. Ben adds: "Media are inundated with app pitches - keep your pitch concise, and keep your explanation of what it is that your app does and what makes your app different to the point. Include download links, or at least give the most appropriate search term to use in the App Store too!"

2. If at all possible, include a download code. Always assume that the reviewer is lazy, or busy, or both. If they can try the game straight away, there's more chance of a review.

3. Include screenshots. Proper screenshots that look brilliant and can be used in print or online. Sometimes writers just want to do a roundup of interesting-looking games. That's not as good as a proper review, but it's still publicity and potential new users - so you don't want the writer to check the enclosed images and find that they're tiny, or ugly, or aren’t really screenshots at all but are actually screenshots superimposed on a picture of an iPhone with annotations and logos plastered all over it. You want there to be as few obstacles as possible between the writer getting your email and the writer posting an article about your app.