It is now a little over 4 month ago that I have released Gigtool in the iOS app store. I was aware, that most applications in the app store don’t perform well without heavy promotion. I wrote Gigtool with a very small target audience in mind to test whether specialized applications might produce a steady revenue stream even without any promotion. The reasoning behind this is, that Gigtool will be found by its target audience using the search functionality of the app store.

I released Gigtool for a price of $1.99 in the music category of the store. As long as Gigtool was mentioned on the front page of that category under the “New & Noteworthy” section there was a steady stream of around 5 sales per day. This dwindled to next to nothing once Gigtool dropped out of the “New & Noteworthy” section. At that time I had only around 2 sales per week.

After 4 weeks I decided to check out how many people would download the app if it is a free app. I did not expect the results though. Gigtool got mentioned on a couple of news sites which monitor the app store for price drops and that lead to around 7000 downloads in the first week. Seems like people were downloading Gigtool without even knowing what it does just for the sake of it. Downloads remained in the area of around 50 per day throughout the month.

The following month I released a small bugfix update and changed the price to $0.99. It seems that around half of the people who downloaded Gigtool for free still have it installed on their device. So it is obvious that there is a target audience out there for this app. Sales went a little smoother than when the app did cost $1.99. For the last 2 month I had a steady 5 to 10 sales per week. This is not very much, but at least it will cover the costs (app store, website, domains, …).

So, after these 4 months, have my expectations been met? Well, yes and no I guess. I did not have great expectations in the beginning. My goal was to cover the costs. I guess this goal will be reached in a couple of month. So this is one side of it. The other side is that without proper marketing even a highly specialized application will not do well on the app store. There are a couple of customers that find the application via the search box but this is by far not enough to cover any development costs at all.

I thought that people searching for this type of application would be willing to spend more than $0.99 for the app, but here it seems, that the $0.99 price seems to be a kind of motivation wall. Once the price is higher, sales drop dramatically. With a price of $0.99 the revenue is nearly twice as high as with a price of $1.99.

So, what did I learn with my first app in the app store. I guess it is absolutely necessary to promote your app. Send out demo keys to blogs and news sites related to your target audience. This is something I want to try in the future. Also pricing seems to be important. Staying below the $1 barrier boosted the overall revenue.

Personally, I will take a look at the influence of marketing the app and I also plan to develop another small app which will be free and use the iAds mechanism for revenue. Let’s see how well that performs.