Paid Apps: Then and Now
Since the development of the smartphone, mobile apps have been the forefront of the daily lives of millions across the globe. Mobile apps allow us to work more efficiently, stay better connected, and do more than ever before.
While there are countless app categories and subcategories, all apps can be divided into two hierarching categories – paid apps and free apps. Free apps tend to have higher download rates initially, but often lack engagement after download. Paid apps are often overlooked simply because they have a cost, and with so much competition in the app store, it can be easy for users to find a free alternative. Developers are challenged with finding balance between covering their overhead expenses and providing the best User Experience possible for their audiences. This balance is often found in a Paid App pricing model.
A Brief History of Paid Apps
Mobile Apps have been available for download in the Apple App Store, which at the time was an extension of the iTunes store, since its birth in 2008. The first model introduced to the stores was the paid model which began taking off and generating revenues. During the years of 2011-2012, the total revenue was doubled, from $7,1 billion in 2011 to $15,4 billion.
However, since 2012, there has been a steep decline due to the inception of in-app purchases and the freemium model.
Even though the majority of apps in the app stores are listed under a free pricing model, plenty of developers successfully charge their audiences for the download of their apps. We’ll cover some of the advantages and disadvantages of paid mobile apps, as well as some specific marketing tactics to encourage more downloads, build trust with your audience, and create a positive reputation for your brand.
Benefits of Paid Pricing Models
The obvious advantage of charging users to download a mobile app is higher revenue per download. By charging for premium apps, developers are better able to cover overhead costs and developer fees ($99/year for the Apple App Store and a one-time $25 fee for Google Play Store). Paid apps have a higher perceived value to the user, and users are more likely to regularly engage with and be loyal to an app they’ve paid for. This can spell success for developers with a large, pre-established customer base.
Additionally, increased revenue means that developers can invest more funds and provide a better, cleaner user experience with more consistent updates and fixes. Paid app developers put an emphasis on creating the best possible design, functionality, and user experience for all users.
Disadvantages of Paid Pricing Models
There are drawbacks to paid apps for both the developer and the user. For developers,paid apps tend to have less downloads and less reviews, which can affect how easily your app is found in the app store. For the user, cost is the most obvious barrier to entry, but the specific dollar amount is not usually the deciding factor. Since users perceive apps they have to pay for as higher quality, they often have much higher expectations of the app’s performance. Because of this perceived value, paid apps are more likely to have harsher, lower-rated reviews, as users expect developers to regularly and consistently provide customer service and updates.
Marketing Your Paid App
Apple + Android both report 2 million apps in their app stores. Standing out in a sea of over 2 million individual apps available for download is not an easy goal to accomplish. It can cost developers who are considered “Top Earners” upwards of $200,000 to gain a position in the top 25 of the app store. The takeaway: if developers want their paid apps to succeed, marketing needs to be a priority. Below are a few actionable ways developers can increase app downloads, get more reviews, and improve the ROI of their paid mobile apps.
Related content: How To Monetize Mobile Apps: The Key Strategies You Need to Know
App Store Marketing (ASO)
If you are in the tech industry or have a web-based business, chances are you’ve heard of Search Engine Optimization (SEO). The app store itself is a lot like a search engine, striving to provide users with the best possible search results for their unique preferences and searches. In that sense, many of the ‘rules’ and best practices of optimizing for search engines also apply to optimizing for the App Store “53% of Android users and 47% of iOS users found the last app they downloaded through app store search” according to a study conducted by Tune. Developers can perform “ASO”, or app store optimization, to improve their visibility and conversion rate within the app stores.
Just as search engines use keywords to categorize web pages, keywords play a critical role in visibility. Take a look at some of the top performers in your app’s category and take note of the keywords and phrases used. Then, perform keyword research using tools like the Adwords Keyword tool or KeywordTool.io to find the best keywords for your target audience and app category. Plug in phrases from the Top Performers into the keyword tool to find suggestions on similar phrases. Incorporate the phrases with the highest search volume into your title and description.
While not required, having a web-based landing page for your app will allow you to funnel traffic first onto a website for better incoming traffic tracking, greater control over the messaging, and a chance to cookie your site visitors’ browsers to reach them later. You can then send traffic from social media, QR codes, and ads to your app’s website/landing page and get a clearer sense of your true ROI from these channels. Additionally, performing ASO on your app store page and SEO on the web-based landing page will help your app become even more visible online.
To put it simply, the more targeted traffic you drive to your app’s app store pages, the higher it will rank in both search engine and app store search results. More traffic to your app translates into a higher number of downloads and reviews, each of which plays a critical role in success app store marketing.
In addition to creating backlinks on app profiles, relevant sites, and local listings, referral marketing and guest posting techniques can be utilized. Guest blogging should be done on blogs with an audience that will most likely be interested in downloading your app.
Micro Niche Apps created a case study to determine if building links to app store pages really did improve app rankings in the Google Play Store. Read more about the case study and link building’s effects on rankings here.
Make Paid Apps Free – For A Limited Time
It’s indisputable that free apps have higher download rates. Users feel more inclined to “try” an app when they have nothing to lose and have no entry barriers holding them back. Setting your paid apps to free, but emphasizing that it is for a limited time in your description, social media posts, and other PR, plays up on the aforementioned perceived value factor. Users feel like they are receiving something of value and are more likely to download the app on a whim. Additionally, free apps play up the reciprocity effect, which states that humans have a tendency to return favors that are done for them. By giving your audience your app for free, they are more likely to return the favor and write a favorable review.
The number of app downloads and reviews play a huge role in the success of your app. Setting your paid app to free for a limited time can give your marketing efforts an extra boost and increase your number of downloads and high-rated reviews.
Similar to the ‘going free’ tactic is the concept of Freemium pricing models. We already know that free apps get downloaded more than paid ones. Freemium models as a monetization strategy allow users to still download the app for free, while certain capabilities remain locked until paid for. This pricing model can be an extremely effective and profitable tactic, especially for developers who want to monetize their mobile apps without clouding the user’s experience with ads.
Creating “hype” and brand awareness around your app supports all other marketing initiatives. Eye-catching graphics, humorous or otherwise memorable social media posts, and targeted, optimized ads will result in higher downloads, better brand retention, and stronger levels of trust between you and your audience.
Visual branding is a critical part of an app’s success. Graphics are often times the very first interaction a user has with a mobile app. An app’s logo, app store screenshots, supporting images, and banner graphics should be eye-catching and memorable, and use the same branding and color scheme as the app itself. Graphics can be shared and displayed on profiles and portfolios, backlinks and referral websites, and social media channels. Using well-designed images ensures your app conveys quality and value, which will encourage downloads of your paid app.
Video can be an especially useful tool in capturing a user’s attention and demonstrating the true look and feel of the app itself. By creating a demonstration video of your app in use, you can give your audience a sneak peek at your app’s features, design, and overall experience. Video content can also demonstrate your app’s value and make a positive first impression during the valuable 3-5 seconds a user will spend before making a decision.
A strong organic social media presence can drive even more traffic to app store pages and support your marketing initiatives. Regularly posting content that is useful, thought-provoking, or funny to the target audience supports user trust, branding initiatives, and a strong SEO presence. Additionally, users tend to be more engaged with brands on social, and some demographics even prefer communicating with brands on social media to other channels of communication.
Tools like Buffer can help manage social media channels for your app and help track the performance of your posts.
Google+ is a unique social media channel due to its effect on organic rankings on Google. Content posted to Google+ is immediately indexed in the Google results page, and is often displayed on the first page of the results above other social media channels. Creating a Google+ profile for your app and regularly posting graphic content, landing page links, and app store links will not only reach a highly engaged audience on the channel itself, but will also help the visibility of your app on search engines.
App Store Search Ads
As more and more apps enter into the app store, it is becoming increasingly difficult for small-to-medium-sized developers to compete with large scale enterprise developers. App store ads, available in the Apple App store as of October, allow developers to bid on and gain visibility for their most valuable search terms. Since over 20% of apps are discovered through app store searches, App Store Search Ads can help developers better stand out against their competition and reach new audiences.
Paid search advertising with the goal of mobile app installs can be an extremely ROI-positive method of marketing a paid app. Depending on your budget, mobile app install PPC ads can put your app at the top of the Google results, which in addition to promoting downloads also supports branding and offline marketing initiatives. Google adwords even provides keyword and copy suggestions based on your app ID.
As with ASO, it is a good idea to scan the top performing competitors in your app’s industry and category and note the keywords and phrases being used and the structure of the ads
Additionally, you can run both text and image PPC ads on the display network and narrowly target which sites you’d like to your display ads based on categories and the demographics and preferences of visitors. This ensures your ads are highly targeted and reach an engaged audience. You can also use media buying to promote your apps through a cpm/cpc basis.
Influencer marketing connects brands and consumers organically. Companies look for well known personalities and influencers with massive followers and social media presence on social networks like Facebook, Twitter and Instagram to use their product/apps. Developers/companies create branded content with the social media influencers, delivering powerful messages and luring in their targeted audience.
Don’t give up on Paid Apps
As we’ve seen, generating both downloads and revenue from paid apps has become increasingly difficult over the last few years. However, let’s not kill off paid apps just yet. At the end of the day users will continue to pay money for an exceptional, exciting, and fun app. If you have the idea, resources, patience and heart you’ve got as good of a chance to generate revenue as any freemium app. Creating a paid app may be a bumpy ride but you’ve got our marketing guide to help you on your journey.