Deciding on how much you charge for your app can be tough: as Raam Thakrar says, there’s a lot of interesting thinking around that! Many companies struggle to make the numbers tally even if they charge; many others choose not to charge for their app in order to get higher numbers of downloads. Touchnote, for example, offers a service whereby they give the application away for free, and then charge each time it is used.
“We very much wanted to encourage multiple and repeat usage,” Raam explains. “So that was a very easy decision. You can think of many other apps that do charge on the first download. But for an app developer, the central question is, ‘What is my return on investment, in terms of the amount of money I will likely make versus the amount of hours I will put in?’”
Often you can adjust the price and monitor the reaction, and make the decision through trial and error, and learning what sells and what doesn’t. “We’ve tried a number of pricing strategies,” says David. “So if some apps were doing well, we put them up a bit. But then they wouldn’t sell, and so then we would cut them and see if we would get more downloads...”
Some of the apps The App Factory develops and publishes are free downloads, and money is made back on adverts. If you go down this route, when you put your app through to the store, the platform decides on the advert that will display on your banner.
The Tweetdeck app is entirely free, without advertising; founder Iain Dodsworth suggests developers decide whether they want to make money directly from the product they’re building or if they want a lot of users. “We’re not selling these apps,” Iain says, “They’re all free. We are developing a broad user base.”
In terms of monetising the venture, if you make your app free, it is not plain sailing. If you want to trial this approach, it is best to have funding behind you. Again, there are not many people who make money out of it. As Raam says: “There are too many people putting hours and weeks and months into it, who are getting £2,000. When it comes to a return on two months of work, that is not even enough to live on, let alone increase the business on!”
All the platforms need developers to continue developing applications as they are doing now. So perhaps things will ultimately change so that developers/publishers get a better return on investment. Until then, choose your pricing strategy with care.