iTunes App Store: Lessons from the first 30 months TOC: February - PowerPoint PPT Presentation

iTunes App Store: Lessons from the first 30 months TOC: February 2011 Ben Lorica twitter.com/BIGDATA twitter.com/DLIMAN

Data for this talk: U.S. iTunes store (Jul/2008 - present)

ALL-TIME Rankings - Downloads through mid Jan/2011 # of Apps on All-time Rankings !&)&$"*(!! PAID !'($%('!! +,-./0! +,12! !")#$')&!! FREE !"#$%&&!!

ALL-TIME Top PAID Apps - Share of GAMES iPhone iPad 36% 53% Top 100 52% 35% Top 1,000 38% 26% Top 10,000

Challenge: “App discovery” in light of “Sturgeon’s Law” <“Just like the Internet: high-volume of low quality stuff.”>

App Discovery Tools  User-Interface - Taxonomy - Lists: top-sellers, curated  Software tools - Search - Recommendation Engine  Third-party tools ; startups - Lists, reviews, social

List of “Hits” on the iTunes App Store

Top Charts - Jun/2010 to present DEVICE iTunes Top Paid Top 200 Top 50 Overall Overall Category Top Free Top 200 Top Overall Grossing Category

“Velocity of Hits” # of Days Initial app Debut on store Top 200 appearance List

Days until debut: Overall Top 200 Charts MEDIAN Age in Days on Top 200 Debut '()!)1/2! !&!! iPad '()!-+(../0-! !%!! iPhone '()!*+,,! !#!! '()!)1/2! !$!! Top 200 lists since June/2010, and apps that launched after the launch of the iPad. '()!-+(../0-! !#!! '()!*+,,! !"#!!

Duration on Top 200 Long-term Hit =>30 or more days on Top 200 List

Duration - What share of ‘hits’ last a month or longer? Share of Top 200 apps that spent at least 30 days on Top Chart '()$%**$ %!#$ 3405$ %&#$ '()$%**$ %&#$ .,(//012$ %&#$ iPad iPhone '()$%**$ !&#$ +,--$ !"#$ Apps that have appeared, in the main Top 200 charts, since Jun/2010.

MEDIAN Duration: Top 200 Paid iPhone & iPad Apps 3.4!%55!144,! "! iPad 012*,! $%! -../,! (! )*+,! &'! 3.4!%55!144,! !"!! 012*,! !$%!! iPhone -../,! !#!! MEDIAN Unique Days in Category Top 200 Paid iPad & iPhone Apps List )*+,! !"!! (since June/2010)

For Paid apps: Effectiveness of simple “Pricing” experiments

iTunes Pricing: Overview

Quick Visual Comparison of Large iTunes Categories Average Median Variation “Middle 50%” 25th percentile to 75th percentile

Middle 50% , Median, and the Interquartile Range MEDIAN 25th 75th percentile percentile Variation (Interquartile Range)

iPhone: ALL-TIME Top 500 Paid apps in each category Games => Median $0.99 ; Middle 50 = [$0.99 to $2.99] Reference => Median $1.99 ; Middle 50 = [$0.99 to $4.99] Price of All-time Top 500 Paid iPhone Apps in each category

iPad: ALL-TIME Top 500 Paid apps in each category Games => Median $1.99 ; Middle 50 = [$0.99 to $3.99] Reference => Median $2.99 ; Middle 50 = [$1.99 to $9.99] Price of All-time Top 500 Paid iPad Apps in each category

Revised Experiment Rank 200 100 $2 $4 Price ($)

Analysis of Top 200 iPhone apps that cut their prices

In some categories: A price decrease, leads to a rank decrease ... on day of price change

But , the effect of a price cut disappears within days.

Curated Lists remain very influential

Lists of Featured Apps - Jun/2010 to present DEVICE iTunes New & Overall Overall Noteworthy & in Category What’s Hot Staff Overall Favorites

App Discovery and Featured Apps  May/2010 survey of 96 developers  “Being featured by Apple is the greatest contributor to spiking sales.”  “ New and Noteworthy produced slightly less gains than Staff Favorites or What’s Hot ”.

Revised Experiment Rank 500 100 App gets BEFORE AFTER Featured

Featured Apps and Rank - Sep/2009 to May/2010 Degree outperformed “Expected” Rank +60% 3224,' %/0*#12)' %)!%"!#-).%)!' )%+'5')2!%+2"!67' )%+,' +6#!8,'62!' "%(%"%)*%' ,!#9'(#$2"-!%,' !"#$%&' (Ranks compared on days immediately after being featured.)

Becoming a Featured App - “Tips” from devs  What’s Hot - Consistent sales over a period of time - “fast-movers” in terms of sales rank - Popular apps that have been updated  New and Noteworthy - Use new features of device - Uniqueness, Quality, Clean design

MEDIAN Age at debut on “Featured” Lists 6789!:0,-! !('!! 5/1*,! !("!! 2334,! !"(!! *)-*.-/0)1*)-! !#'!! )*+,! !"&!! What’s Hot 6789!:0,-! !%!! New & 5/1*,! !$!! Noteworthy 2334,! !#!! *)-*.-/0)1*)-! !#!! MEDIAN Age in Days when an App gets Featured )*+,! !"!! U.S. App Store (Jun/2010 - present)

AVG # of Apps in the Main “New & Noteworthy” List 84.(*" &$" iPad 506(*275(" $" ('2(3240'.('2" $" iPhone ./*01" #" +,,-*" #" '()*" #" 84.(*" !#" 506(*275(" %" ('2(3240'.('2" $" ./*01" #" MEDIAN Weekly # of of Unique Apps on the Main “New & Noteworthy” +,,-*" !" List '()*" !" U.S. App Store (Jun/2010 - present)

Wisdom of the crowd: Top 200 Paid Top 200 Free Top 200 Grossing

Wisdom of Apple: New & Noteworthy What’s Hot Staff Favorites

Final Tip: Consolidate paid & free apps

In-app Purchases and Free Apps  Oct/2009: Apple allows “in-app” purchases for Free Apps  Freemium model => unlock premium features (demo-to-pay)  Develop, maintain, & market, ONE app

“Free” Top 200 Grossing Apps - since June/2010 Share of FREE Apps 3,9$%""$75,++.17$ !*#$ 124+$ )(#$ 7/82+$ !(#$ iPad +,-./0$1234,56.17$ %!#$ iPhone 3,9$%""$75,++.17$ !&#$ 124+$ '#$ 7/82+$ %&#$ +,-./0$1234,56.17$ !"#$ Category Top 200 Grossing Apps (Jun/2010 - present)

%!"# %$"# &!"# &$"# '!"# '$"# (!"# Share of Free Apps has risen steadily !"# $"# &!!)*!+# &!!)*!)# &!!)*!,# &!!)*%!# ./45# ./0123# &!!)*%%# &!!)*%&# &!!,*!%# &!!,*!&# &!!,*!'# &!!,*!(# &!!,*!$# &!!,*!-# &!!,*!+# &!!,*!)# &!!,*!,# &!!,*%!# Free Apps Oct/2009: In-app purchases for &!!,*%%# &!!,*%&# &!%!*!%# &!%!*!&# &!%!*!'# &!%!*!(# &!%!*!$# &!%!*!-# &!%!*!+# &!%!*!)# &!%!*!,# &!%!*%!# &!%!*%%# &!%!*%&# &!%%*!%#

Questions? twitter.com/BIGDATA twitter.com/DLIMAN