The New Rules of the App Store

This post is an excerpt from Rana Sobhany‘s new book, Mobilize: Strategies for Success from the Frontlines of the App Revolution. Mobilize walks developers through the positioning, marketing and outreach needed to create successful apps. In her opening chapter, Sobhany follows the history of the app store phenomenon from its early days through the successes, failures, loopholes, and overhauls that have shaped the multi-million dollar industry.

The App Store will continue to evolve, and participants in this new economy must continuously reevaluate and refine their relationship with the platform. Gone are the days of cheating one’s way through the App Store.

In order to create a sustainable platform, we must document and memorialize the best practices that will serve as a guide and template for ensuring high quality on the store. While we can get crafty with our marketing campaigns and techniques, there must be a basal level of understanding for which acceptable practices will be moving forward.

As with all good retail, there are certain rules fundamental to establishing a presence in the App Store. Here are some of those rules.

Rule 1: Remember the Law of Diminishing Marginal Utility

“Diminishing marginal utility” is a law of economics stating that as a person increases consumption of a particular product, while keeping consumption of other products constant, there is a decline in the marginal utility that person derives from consuming each additional unit of that product.

As a co-founder of Medialets, the largest in-application analytics and advertising platform, Rana Sobhany has been deeply involved in the successful design and implementation of comprehensive application marketing campaigns for products across the mobile industry, including iPhone, and was among the first to promote app marketing as a discrete practice.
She has coached mobile application developers at every level: individual developers; independent development shops; creative and media buying agencies; and large, venture-backed application firms.
Rana is a frequent speaker at mobile and technology conferences, helping educate developers about how best to develop and market their products for the iPhone and iPad ecosystems.

This concept boils down to a simple idea: something is only as valuable as what you are willing to pay for it. Thereby, apps are only worth as much as users are willing to pay for them at the time of purchase.

A great example this concept executed poorly is the newspaper industry. The high-level concept of news is that information is very timely, valuable, and accurate. Yet most newspaper content costs less than a dollar to purchase in physical format, and it is absolutely free in digital format. This makes absolutely no sense from a pricing standpoint. If this content is valuable, then users will be willing to pay for it.

As it relates to your app, if you as the decision maker train your customers via pricing strategy that your content is a valuable commodity, it becomes a self-fulfilling prophecy. Inversely, no one wants to participate in content that’s not viewed as valuable, even if it’s only for entertainment purposes.

Marketing your applications well may merit a higher price point, thus increasing the perceived quality of your app and leveling the playing field between you and big-name, big-budget publishers. Every developer is an indie developer in the App Store. Everyone is going through the exact same thing.

Electronic Arts values its games at $9.99. Why can’t you.

Rule 2: Don’t Spam . . . Unless It’s Helpful

Many observers say that Apple’s App Store download figures and application counts are inflated due to a large number of generally useless applications. This is troubling and devalues the benefits having a closed environment brings. However, moderation of applications via the App Store approval process has inevitably filtered out many of the “test” applications developers are building and attempting to distribute just to say they have an app on the store.

Which brings us to spam. Anytime a developer attempts to game the system in order to advance in the App Store rankings, it is referred to as “spamming.”

Spamming techniques have been around since the beginning of the App Store, beginning with the exploitation of naming conventions. And in an effort to drive revenues simply by sheer volume in the App Store, some developers have created thousands and thousands of lightweight shells of applications populated with basic or low-value content, and flooded the market in hopes of tricking a few thousand customers into buying them for $0.99.

To put it lightly, this is not a recommended way to market applications. Apple has started to crack down on this type of behavior. On multiple occasions it has banned developers who abused the App Store platform in this way, eradicating thousands of “filler” applications. But there’s a lot we can learn from the spam techniques tested by others that caused users to respond positively.

The beauty of a digital distribution system like the App Store is that developers can test pricing, colors, marketing copy, and all other types of branding to determine what users like. Be sure to include this type of A/B testing–comparing your core message with variants to see which works best–when you are launching your application, especially if you think there may be fragmentation in your user base and target audience.

Knowing what your audience wants will help you learn how to best present your application to it in the most appealing way possible.

Rule 3: Avoid Update Fatigue

In previous iterations of the App Store, updating your application was grounds for reentering the “What’s New” list, but not anymore.This was a very popular spam technique, but then Apple spotted this trick and quickly changed its mechanisms around app updates. Software engineers tend to be compulsive updaters of their software, but don’t assume that consumers are like you. Many users don’t know what those red numbers sitting next to the App Store icon on their phone mean, let alone on their desktop version of iTunes.

Update only when you need to update. Otherwise you may alienate your core customers.

Rule 4: Don’t Necessarily Blame Apple When Things Go Wrong

It seems that the first response developers have when they encounter challenges, no matter what they may be, is to blame Apple. Although Apple has certainly contributed to frustration in some regards, developers have made Apple the scapegoat. This doesn’t benefit developers who ultimately need Apple to provide the platform that has made them so successful.

Developers are constantly getting entangled in the minutiae of their day-to-day experience with the inefficient vagaries of the App Store and neglecting to think about the big picture. Taking a step back, we need to think about the rest of the world and how it perceives the marketplace offering a selection of software to choose from.

“Average consumers could care less if iPhone developers are unhappy,” says Brian Chen. Yet Apple has incentive to keep a basal level of peace among iPhone developers.

The worst possible outcome for Apple would be a developer revolt leading to a mass exodus of famous developers providing killer apps to competing smartphone platforms while boycotting Apple’s [he warns]. I highly doubt this will happen, but Apple must be aware there’s something broken in its system that could lead to epic consequences if unaddressed.

The first aspect of this rule is that it’s not Apple’s fault that developers hate the App Store. It seems like every day there’s another story about a developer who feels personally persecuted by the App Store’s policies. Apple’s Phil Schiller, senior vice president of Marketing, has on two occasions addressed this: once when he reached out to prominent Apple blogger John Gruber via email to discuss the decision Apple made in removing a dictionary application from the App Store that contained “objectionable content” in August 2009; and a second time when he went to the press directly to talk about the App Store’s approval process in a one-on-one interview with Business Week’s Arik Hesseldahl in November 2009.

Chen theorizes:

Phil Schiller’s outreach is hardly a direct solution for Apple’s communication problem, but it’s a positive sign that Apple is even making the slightest effort to publicly communicate its approval process. It suggests the company is aware that it needs to do something to maintain positive relations with developers, and knowing that Jobs isn’t the type to sit around and twiddle his thumbs, there must be a larger solution in the works.

And some of the problems are simply the result of the App Store growing so big, so fast. Once again, keep in mind that Apple could never have predicted the level of popularity the store would achieve in such a short period of time.

In order to launch the App Store as scheduled, Apple created a subsection of the existing iTunes Music Store and leveraged existing technology to support the App Store.This distribution system wasn’t custom built to accommodate applications, and even two years later many of the basic problems have not been addressed.

For example, consumers “gift” applications to one another. Previously, there was an ad-hoc promo code system that was slapped together to enable developers to distribute their apps to the media and other relevant parties. Changes like this indicate signs that Apple is working on correcting the challenges for developers. There have, however, been numerous problems with redeeming promo codes for applications. And Beta testers will inevitably encounter problems with accessing popular apps if they’ve recently acquired a new phone or upgraded to a newer model. There is a one hundred-UDID (unique device identifier) limit to beta testing applications, and once you’ve hit that, that’s it.

Early on in iTunes, there was a similar problem on the music side. When users reformatted their computers or bought a new one, the authorization of their new machine would count toward the five computers allowed to play back the purchased content. Apple resolved this – somewhat – by enabling users to purge authorizations once a year and manually reauthorize the machines they wanted to give access to.

Apple has gotten smarter about the App Store, but the App Store still isn’t perfect. It will improve as Apple begins to get its head wrapped around the needs and desires of each constituency represented on the platform.

Excerpted from MOBILIZE, by Rana June Sobhany. Copyright © 2011 by Rana June Sobhany. Published and reprinted with permission from Vanguard Press, a member of The Perseus Books Group. All rights reserved.

App screenshots by dougbelshaw