Secret to App Store Success: $1,875 per day


Do you have what it takes to create the next great iPhone app? Or have it featured on iPhone commercials and installed on the all iTouches at the Apple (s aapl) store? Maybe have a big ol’ icon flashing so fast at the next WWDC that you have to include a seizure warning? There’s an app for that!

It’s called your checkbook.

The folks at AdWhirl recently calculated (PDF) what it costs to get your app into Apple’s Top 100 rankings: $1,875 a day. They determined this by looking at so-called untargeted marketing, click-through rates on ads, and actual app sales. Since AdWhirl sells targeted ads, I wondered if their findings were accurate or merely a sales pitch of their own. Does popularity have a simple price tag?

Fortunately, I know someone from the original Grocery iQ team. Grocery iQ was able to win the triple crown of apps: a Top 100 ranking, Apple Pick of the Week, and being featured under “What’s Hot.” What was its secret to success? When Apple released its Top Apps of 2008, Grocery iQ was in the top 50. I think that makes the Grocery iQ team qualified to talk about App Store success.

Jason Boehle, co-founder of Free State Labs (developer of Grocery iQ) and now a software engineer at Coupons, Inc, was able to give me some insights on AdWhirl’s findings. In the interest of open disclosure, I helped test the Grocery iQ app at the beginning, which earned me some face time with Jason.

Jason’s first response to the $1,875 per day price tag: “Yup, that’s about right!” The Grocery iQ team dabbled with paid ad networks and calculated that to make the top 100, they’d have to spend close to that amount for at least two weeks. “Small indie developers simply don’t have that kind of money,” Jason said.

Jason also agreed with AdWhirl’s assertion that free or “lite” apps do lead to, rather than cannibalize away, sales of paid apps. Since the App Store doesn’t have any way to try apps before you buy, free versions seem to be a good way to get buzz about your paid app. Free versions sometimes have ads, so AdWhirl’s report may be biased towards this view. Finding the right mix of features and ads while maintaining quality is tricky.

How did Grocery iQ get to be the pick of the week? “We did our best to build a great product and it got noticed,” according to Jason. During this time, Grocery iQ was ranked as high as eighth in the App Store and generated thousands of sales a day. The Grocery IQ team was told that the group at Apple that determined the picks meets weekly. Each member of the Apple team comes in with ideas of what he or she likes, and they vote. Grocery iQ didn’t know anyone or use a special formula. Paying for ads might get your app noticed by Apple, but it won’t get it named as pick of the week.

Though Jason couldn’t comment specifically, the purchase obviously helps Grocery iQ reach a target market of grocery purchasers, and is consistent with AdWhirl’s findings that one way to reduce the $1,875 price tag is by finding a target audience for your product. Shopping and coupons are a natural fit, and we should expect to see more web properties using the App Store to promote their products, and vice versa.

What if you don’t have the cash for advertising, or you can’t find a target market? Jason thinks it’s become much harder to get your app noticed due to all the competition. He said that small developers “need to find features that differentiate them from the competition and then develop apps people really want.” Then you have to go viral with your marketing efforts, which unfortunately is often quite difficult.

So, all you need is $1,875 a day. Either that, or develop a great app. Grocery IQ used the latter, while it appears some other apps have the pockets deep enough to do the former. A little luck probably doesn’t hurt, either.