Discount on iPhone Apps Improves Profit Margins by 159%

Studies have revealed that the reduction of prices for iPad and iPhone apps have improved the volume of download and also the overall revenue structure. Distimo, a mobile apps analytics company states that developers can increase their profit margins by 159% within a week following the abatement in prices.

Following the discount, the average download for iPhone shot up by 1665%, and iPad by 871%.

Studies by Distimo reveal that there has been a marked improvement in the amount of download within three days. Therefore, longer the sale lasts, the greater will be the profit margin.

Apple explains its move. The company gives a two-fold reasoning for this growth effect and says that either there is an increase in revenue from one-off service charges, or the profits generated by in-house app purchases.

iphone-profit

Image Source: mashable.com

Therefore it is not surprising when the download of apps decreases with the hike in costs. There is a sharp slide as downloads drop by -46% for iPhones and -57% for iPads.

The app store launched by Apple grew steadily in the last quarter of 2012, with discounts being given on the price of 930 iPad apps and iPhone apps. Similar results were seen when discounts were announced in the Google Play store, though the profit margins were not as overwhelming as it was for the iOS App Store.

Consumers can only hope that these discounts are announced more frequently for longer periods so that they can explore and utilize the apps available to the fullest extent.

Related posts