Lowering Your Price

price is working. If, after a few months, you are not seeing steady sales or your sales are starting to drop off, you'll want to look at pricing as a possible option to adjust. Be sure to consider the following questions before determining that you want to lower your price:

• Have sales for your app steadily declined over the past two to three

• Have you checked competitors' prices? Have they dropped their price?

• Have the leaders in your category of apps dropped their prices?

• Have your reviews indicated that your price is too high? Figure 15.1 shows a reviewer's comments that indicate an app's price is too high.

Figure 15.1 Buyer's feedback will always tell you when the price of your app is too high.

• Has an external reviewer from a website indicated he or she likes your app but it's priced too high?

You can track price drops through email alerts or RSS feeds by going to sites such as www.appbrain.com. You can search by categories, free or paid, and most popular with this site. An example from this site is shown in Figure 15.2.

If you have determined that a price cut is in order, then the next step is to determine how much to lower it. This depends on where your price point is. Some apps are priced at $49.99 and are dropped to $9.99. That's an astounding 80% drop! However, other apps are priced at $1.99 and are dropped to $0.99. That's obviously a 50% drop and will impact your revenue substantially.


Cli Tntntty

I trrppn

Totally not worth ? bucks. I was exporting more than what the Screenshots show, maybe some menu button options... but there's nothing more to it.

Charigelog for FlightStats for Android

May 18,201D


Version 2.1 6

AprB, 2010


Version 2.1.5

Mar 17,2010


Version 2.1.4

Mar 14,2010

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Version 2.1.3

Mar 13,2010


Version 2.1.2

Mar 11,2010

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Version 2.1.1

Mar 10,2010


New Price: 14.99 (®6t99)

Mar 10,2010

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Version 2.1

Jan 12,2010

t|«|i|5,000-10,000 downloads

Figure 15.2 Use a website to help you track price drops for apps in your category. This will help you gauge where prices are trending for your type of app.

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Always factor the 30% cut that Google takes in your pricing decisions. An app that was priced at $4.99 is giving the developer $3.49 after Google takes its cut. If that same app is priced down to $0.99, Google pays the developer $0.69 after the price drop. That's an 80% decline in any revenues you might have.

Once you have dropped your price, carefully monitor daily sales activity. If your app is priced at the right level, you will see an increase in sales immediately. As you know, there is a great deal of price sensitivity for Android apps. This can be attributed to a couple things. First, the buyer has already spent several hundred dollars on an Android phone and even more on accessories and other add-ons. So, in addition to a monthly phone/Internet bill, the buyer is sensitive about spending more money on additional apps for the device. Second, the global economy over the past couple years has made budgets extremely tight for most typical buyers.

The last piece of advice for pricing is that you have to keep your overall brand strategy in mind. If you intend to build many apps and release them on a fairly frequent basis, your app prices will most likely be on the low end. If you keep prices low and update your app frequently, you can extend the life of your app.

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