Tag Archives: iphone

Experiences promoting niche software

This is a guest post from fellow software developer, Simon Kravis.

It’s sometimes said that software development is only 10% of what’s required to earn money from software and I can attest to that. Since 2018 I have been developing photo captioning and related software, more as a retirement diversion than a serious source of income (after a career mostly involved in writing scientific and engineering analysis software), in the hope that sales income would at least cover running costs. My best marketing tool has been writing reviews of the class of software that I produce, and the hosting site (Hub Pages) provides some useful analytics on how often these are accessed and for how long. Below is the graph for an article on tagging.

The decline since early 2022 is hard to explain – the article is periodically updated so the steady decline is not due to diminishing ‘freshness’ – which for Google is probably a file Modified date.

Here is another review article profile (Scanning Multiple Photos) showing a similar decline:

But another (Best Photo Captioning Software) has held up, though at a low level.

I offer digital photo captioning software (Caption Pro) on Windows and Mac platforms, and an iPhone captioning app (CaptionEdit), with the Windows version dating back to 2017. I also offer part of the functionality of Caption Pro on Windows for auto-cropping scans of multiple paper photos (ImageSplit). On Windows neither Caption Pro software downloads or sales seem to correlate with review accesses, despite about 1/3 of web site accesses coming from the review. However, downloads do show some correlation with Caption Pro web site sessions, as shown in the graph below.

Sales do not correlate with downloads, which perhaps explains why most advertising for niche products is not successful – it may increase downloads but this does not appear to increase sales. The observed proportion of downloads resulting in sales for ImageSplit and Caption Pro are 6% and 9% respectively. The lack of correlation between sales and downloads may be due to the small number of sales per month, which results in random fluctuation dominating the results.

The decision to enter the Apple “Walled Garden” of software was partly at the prompting of friends rather than a commercial evaluation. Apple Developer membership (costing ~US$100 per year) is required to prevent software being blocked from installation through being from an unknown publisher. Further costs were purchasing a fairly modern Mac on which to perform development, as the App Store will only accept software developed using recent versions of the Xcode development environment, which will only run on fairly recent hardware. The App Store takes a commission of 15% on sales, which is quite reasonable when compared to the difficulty of implementing e-commerce on Windows, where a PayPal account eases the problem of low-value foreign-currency transactions, but e-commerce plug-ins may stop working after years for no discernible reason. The review process for software acceptance into the App Store is generally fast, but seemly trivial issues can require resubmission. Features which have passed one review may be rejected in a later one. The review process is generally fast, but on one occasion took 4 weeks.

Caption Pro for Mac has been available (via the App Store) only since Sep 2021.It appears within the top 6 results for a search using “Caption Photos”, which is the source for most downloads. About 3.5% of downloads result in sales. This figure is much less than the Windows version of the same app, despite Mac users’ reputation for being more willing to pay for software. The iPhone app did not appear at all initially when searching for “Caption Photos” in the App Store. After 6 months it began appearing as result number 140, after it had 360 downloads. This poor ranking performance is probably because “Caption Photos” is a very popular keyword used by many apps, including those that only caption videos. It has had very few downloads and sales, despite Apple Search Ads and Apptimizer campaigns. The number of downloads increased dramatically during the Apptimizer campaign between Jan 24 and Feb 2 (as they were purchased) but the change in ranking from these downloads did not result in any sales, perhaps because no installs were purchased. The Apple search ads campaign (which resulted in the app being shown as an ad 1 in 50 times when the search phrase “Caption Photos” was used) did not greatly affect downloads or sales. A Facebook ad campaign to show a link to the app whenever “Genealogy” or “Genealogy Software” was searched for was also unsuccessful, and very expensive, as Facebook charges by impressions rather than clicks. Additional backlinks to the web site were purchased in September 2022 from Links Management in an attempt to improve the web site Google ranking, but this did not appear to have any effect on web traffic.

Mac and Windows users contacting me with problems have had a wide range of experience level – from completely naïve to former programmers. Most have been from the US, which reflects the geographic distribution of sales. There have many downloads to non-English speaking countries but very few sales.

Some results from the Mac and iPhone Apps are shown below:

On balance, developing for Apple platforms was not a good commercial decision, as the advantages of a mostly captive audience (completely captive in the case of the iPhone) do not seem to result in higher rates of downloads or sales. Competition for iPhone apps is so intense that niche products without massive advertising budgets are unlikely to succeed. The same is likely to apply to Android phone apps, which anecdotally have a less rigorous review process. My experience is that advertising and backlink purchase for any platform are not effective in increasing sales for niche software.

Simon Kravis runs Aleka Consulting, a small software and consultancy company in Canberra, Australia specializing in information management and offering a number of software products. He has mainly developed scientific and engineering programs, starting in the era of paper tape.

App stores set to dominate future software sales?

Following the success of the iPhone app store (over 6 billion downloads to date), app stores are becoming more and more of a feature of the software landscape. In case you missed it, Apple announced yesterday that there will be an App Store for Macs ‘within 90 days’. In summary:

The Mac app store will be tightly integrated with Mac OS X, including automatic install and update.
There will be restrictions on technology, for example Java apps will not be allowed.
Apple will keep 30% of any revenue from sales.
$99/year subscription for developers.
Developers will still be able to sell their software outside the App store.

It is easy to see why Apple would want to do this:

A potentially huge new revenue stream from third party Mac software sales.
They get even more control over the customer experience.

And this could have advantages for Mac users:

Simpler payment and installation.
Screening out of low quality apps and malware.

And potential advantages for Mac developers:

Mac users might buy more software if it is easier to do so.
One main channel to concentrate your marketing efforts on.
Some of the boring infrastructure of selling software (licensing, shopping cart etc) can be taken care of by Apple.

But the disadvantages are all too obvious:

Your app could be rejected outright. And you won’t know until you submit it for approval. Apple are judge, jury and executioner. The iPhone app store has been infamous its capricious and opaque approval process.
30% is a huge chunk of revenue. Typical payment processors take 5-10% of revenue. Where the new app store cannibalises existing sales (and it is hard to see that it won’t) vendors will lose 20-25% of existing sales revenues.
New apps and updates will be delayed by days or weeks as they go through the app store approval process.
A single centralised app store is likely to make it harder for niche/long-tail apps to make any sort of living. Certainly this is what seems to be happening in the iPhone App store.
Apple are control freaks and have traditionally taken a rather heavy handed approach with developers, including the liberal use of NDAs. The app store will give them even more control.

And worse might follow:

Apple makes a lot of their money from selling over-priced hardware. It may be in their interest to drive software prices down so they can sell more hardware. $5 is considered expensive in the iPhone App Store.
This could be the first step to making Mac OS X a closed system, like iPhone, where only Apple approved apps can be installed.

I guess they can’t piss off developers too much – a computer without third party applications isn’t going to be very attractive to customers. But I am finding it hard to work up any enthusiasm for a Mac app store. If it is successful I can either be in the store and give up a lot of freedom and cannibalize exisiting sales at a much lower margin, or stay out and be shut out of a large chunk of the market. It isn’t an attractive choice. As my app is written in C++/Qt, rather than Objective-C/Cocoa, I am not even sure that it will be eligible for inclusion in the store. I could just abandon Mac OS X, but Microsoft is also rumoured to be working on their own app store (despite the failure of DigitalLocker). That is a truly terrifying prospect given the awfulness of their ‘Works with Vista’ approval process (I speak from personal experience).

Suddenly web apps are looking more interesting.

iPhone App store economics

If you believe all the hype about iPhone apps, you can just hammer out an App in a few weeks, let that nice Mr Jobs take care of all that sordid marketing for you and then sit back to collect a big cheque every month. However the numbers in a recent sobering post about the economics of paid iPhone apps tell a rather different story:

average annual income for a paid iPhone app (after the App store 30%): $3,050
median annual income for a paid iPhone app (after the App store 30%): $682

The numbers are based on various published data from Apple and other sources, plus a few assumptions. I haven’t gone through the numbers and the analysis with a fine tooth comb, but I can’t say I am surprised.

The disconnect between the hype and the reality is so large because Apple (understandably) only want to tell developers about the success stories. The media and the public seem quite happy to go along with this because it makes a more interesting story. But when there are 225,000 apps shouting for attention, only one way to access them via a notoriously dictatorial third party and $5 is considered expensive, it is likely that the majority of developers will do badly. Hence the median is so much worse than the mean. Before you write your iPhone App I think you should ask yourself if it has got a realistic shot at making the top 10 in its App store category. If not, don’t give up the day job just yet.