Friday, February 22, 2019

Raising Prices Lifted App Revenue

Stuart Hall (via Michael Love):

Then I received an app review suggesting I should bump my price. I’d never really considered it. I haven’t given the app a lot of thought since I launched it. It functioned exactly how I needed and the value felt right to me at $1.99.


The results were pretty interesting. Moving to $4.99 immediately gave a big boost in revenue. The conversion rate only dropped 2%. Which means only 1 in 10 people had an objection in paying 2.5x the price!

$7.99 also gave a good bump on revenue with only a slight drop in conversion rate.


Possibly the most interesting future experiment is subscriptions. Based on the feedback I received users are starting to expect subscriptions.

Update (2019-02-26): Ken Case:

We try not to do this very often, but it's time to update our app prices.

3 Comments RSS · Twitter

“Based on the feedback I received users are starting to expect subscriptions.”

Yeah but expecting and accepting are two very different things.

[…] Previously: Raising Prices Lifted App Revenue. […]

People paying you more money makes you more money, News at 11!!!! I kid. While there is often a point of diminishing returns, software should be sustainable. Charge a reasonable amount, keeps the lights on and allows the app to keep getting better. Fair enough.

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