App Store sales result in average revenue gains of 19% for iPad, 22% for iPhone
App publishers on Apple's App Store typically see a significant first-day revenue jump of 52 percent for iPad apps and 41 percent for iPhone apps and and 19 percent and 22 percent overall, respectively, when they put their software on sale, according to a new analysis.
Netherlands-based Distimo published the results of a study tracking app sales and spotlights for top 100 apps across the App Store for iPad and iPhone and the Android Market during the fourth quarter of 2011. According to its findings, apps on the Android Market benefited the most from being featured, while App Store apps on average saw a higher jump in revenue on the first day of a sale.
During the first three days after being featured by their respective stores, iPad apps jumped 27 ranks in the top 100, iPhone apps rose 15 spots and Android titles leapt up 42. Over the course of seven days, Android Market offerings had an average gain of +65, compared to +15 for iPhone apps and +28 for those for the iPad.
The study acknowledged that rank jumps correspond to vastly different uptakes in downloads depending on where an app started on the top 100 list, so it included a graph depicting relative rank changes in terms of percentage with a seven-day average. For instance, an app that jumped from 10 to 5 saw a 50 percent increase in rank, while one that went from 50 to 25 counted as a 100% increase.
Distimo found that about one-third of iPad apps jumped 200 percent in ranks while being featured and approximately 50 percent of Android apps gained 100 percent when spotlighted. The report noted that positive effects continued even after the featured period ended, as iPad, iPhone and Android apps were on average up 145 percent, 75 percent and 828 percent, respectively, five days after.
As for app sales, Android Market software experienced gains of just 7 percent on the first day of a sale, compared to 52 percent for the iPad and 41 percent for the iPhone. During the length of the sale, however, Android apps passed up their iOS counterparts in terms of revenue increase. Revenue for Android Market apps went up 29 percent during a sale, while revenues for iPhone and iPad apps went up 22 and 19 percent.
According to the report, some applications actually lost revenue by going on sale. For example, 44 percent of iPhone applications saw a decline in revenue during a sale. The study found that steeper discounts often resulted in higher revenue gains.
"In general, we noticed that the tipping point happened when the price was cut in half or the application was offered in tier 1 ($0.99) or tier 2 ($1.99)," the report read.
Apple announced this week that it had reached a new milestone of $4 billion paid out to App Store developers. The company had previously reported a $3 billion figure last October during the iPhone 4S launch. The App Store has grown to 550,000 iOS applications, including over 170,000 specifically for the iPad.
A separate study last month found that among top apps with both iOS and Android versions, iOS apps generate 300 percent more revenue than their Android counterparts.