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Distimo report: The impact of app discounts and the impact of being a featured app
Today we are happy to publish the latest Distimo Report, The impact of app discounts and the impact of being a featured app.
This report gives an overview of the effects when an application is featured in the Apple App Store for iPhone, Apple App Store for iPad and Google Android Market. Moreover, this report shows the effects that occur when applications are put on sale. We conclude with data about the average prices of the highest grossing applications and an overview of the types of applications that generate the most revenue. All data covers the Apple App Store for iPhone, Apple App Store for iPad and Google Android Market during the period October – December 2011 in the United States, unless otherwise noted.
The major findings are:
- One of the ways publishers try to attract attention to an application is to put the app on sale. The average revenue rose by 41% in the Apple App Store for iPhone when looking at those applications that were already among the 100 highest grossing applications in any category, on the first day of the sale. Moreover, the revenue during the whole sale increased by 22%. In the Apple App Store for iPad those figures were +52% and +19%, respectively. In the Google Android Market on the first day the revenue increased by 7%, and during the whole sale increased by 29%.
- 30% to 50% of the applications on sale experienced a decrease in revenue even though on average the revenue increased in all three stores for the total group of applications on sale. Our research found that it is important to offer a significant price reduction to actually earn more revenue when putting an application on sale. In general, we noticed that the optimum sales occurred when the price was cut in half or the application was offered in tier 1 ($0.99) or tier 2 ($1.99).
- Another way to attract attention is by getting featured in one of the app stores. When looking at those applications that were already ranked among the top 100 most popular applications, the average gain in the first three days after getting featured was highest in Google Android Market (+42 ranks), followed by Apple App Store for iPad (+27 ranks), and Apple App Store for iPhone (+15). Looking at the whole period these applications were featured (seven days), the rank gains were more or less equal to the three days average in both Apple stores, but were even higher in the Google Android Market (+65 ranks).
- There were also significant effects after an application was featured. In the five days after the featured period ended, the gain was still +145% in the Apple App Store for iPad, +75% in the Apple App Store for iPhone, and +828% in the Google Android Market. +828% exemplifies a rank change from 8 to 1 or 100 to 12 in the Google Android Market.