App Store Reality
11/19/09 12:12 PM Filed in: App Store
In the context of the iPhone App Store economy, the founder of Sorth LLC, Stephen Orth, explains why the next version of Timewerks, the company's time-tracking and billing application, has been so long delayed. He then offers customers good news about the product's next version.
A recent post to our customer support forum has opened my eyes to the fact that our user base is becoming increasingly frustrated by the lack of a new version of Timewerks in many months. I'd like to take this opportunity to publicly explain the reason for the delay in the context of the iTunes App Store reality.
Timewerks, our time-tracking and billing application, has been for sale in the App Store since late September, 2008. Since that time, we've had over 8500 paying customers. The application has been well received: it has garnered favorable reviews from both customers and various websites. Earlier this year, it was featured in several full-page, Apple-sponsored newspaper ads: The New York Times, The Wall Street Journal, USA Today, and The Times (London). In addition, Timewerks has been featured in both the "New and Noteworthy" and "Staff Favorites" sections of the the iTunes App Store. We're fortunate and grateful for Apple's support. During these promotion periods, sales have been great: Increasing to 5 times the normal rate. In June, 2009, we made it as high as #8 in the Paid Business Apps category. So, yes, there's definitely a market for well-made, mobile applications that solve a common, yet specific, business problem. However, as we, and many others, have learned: This is not the App Store reality.
Even before there were over 100,000 applications in the App Store, it became quickly obvious that the only way to succeed in the App Store (financially succeed that is), was to market your application outside that App Store itself-- much the same way a traditional software company would have to market it's own application. The App Store, as many have said, is exactly that: a store with lots and lots of items, and without outside marketing and advertising, it's very hard to get noticed. Ah, but therein lies the catch! It's very difficult, if not impossible, to spend any money marketing or advertising an application when you're only making $7 per sale on 5-10 sales/day (and that's for a $10 app, most paid apps are $.99). In the app store, paid marketing doesn't pay-- you'll never recoup the money you put in. Only large development houses, or big companies with lots of ad dollars can play in that space. Alternatively, some developers have had luck with grassroots marketing efforts: exclusive previews on App Review blogs, posts to Facebook and Twitter, etc, but even these tricks have stopped working as the new mediums have become overloaded with sheer volume and corporate marketing "spam". And, of course, a few independents have done really well in App Store, but iPhone developer success stories are few and far between, as has been discussed ad nauseum over the past few months.
So then, what's a small, independent App Store developer like Sorth to do? We tried playing with our price, lowering it to $.99. Sure, we sold a few more apps, but not enough to justify the added support costs. Thus, we settled on a fixed price of $10-- high for an App Store application, but, we deemed, the only real sustainable price for a company our size. However, as we soon realized, the numbers just didn't add up: without the "free" marketing from the Apple promotions, the app slowly starting sinking in the rankings: from a high of #8, we're currently #106 in Paid Business Apps. It became clear that we couldn't make it as a company just selling apps (i.e. it's hard to feed the family on $250-300/week in revenue). Thus, we turned more attention to the other side of the business: mobile and web application consulting-- building apps for other people.
As a result, we're still here: we're still in business and able to turn a profit. But there's even better news: we're doing well enough on the consulting side that we can return to our true passion, the reason we started this company in the first place: to build intuitive, powerful and, of course, mobile, applications we sell ourselves. The fact that we can do this only by also doing outside consulting (in lieu of taking external investment dollars), says a lot about the real App Store economy-- but that's a topic I'll leave for another day.
I guess this is really just a long winded way of saying Timewerks is back and the best is yet to come. We're working on the next version, 1.7, and it has some great new features. We're planning on submitting it to Apple at the end of this month (November 2009) and we hope to see the new version in the App Store by mid-December. And, that's just the start-- we have big plans for the product in the next few months and we plan on introducing (finally) the full web-based companion in the first part of 2010. Stay tuned!
Thanks for your continued support and patience.
Timewerks, our time-tracking and billing application, has been for sale in the App Store since late September, 2008. Since that time, we've had over 8500 paying customers. The application has been well received: it has garnered favorable reviews from both customers and various websites. Earlier this year, it was featured in several full-page, Apple-sponsored newspaper ads: The New York Times, The Wall Street Journal, USA Today, and The Times (London). In addition, Timewerks has been featured in both the "New and Noteworthy" and "Staff Favorites" sections of the the iTunes App Store. We're fortunate and grateful for Apple's support. During these promotion periods, sales have been great: Increasing to 5 times the normal rate. In June, 2009, we made it as high as #8 in the Paid Business Apps category. So, yes, there's definitely a market for well-made, mobile applications that solve a common, yet specific, business problem. However, as we, and many others, have learned: This is not the App Store reality.
Even before there were over 100,000 applications in the App Store, it became quickly obvious that the only way to succeed in the App Store (financially succeed that is), was to market your application outside that App Store itself-- much the same way a traditional software company would have to market it's own application. The App Store, as many have said, is exactly that: a store with lots and lots of items, and without outside marketing and advertising, it's very hard to get noticed. Ah, but therein lies the catch! It's very difficult, if not impossible, to spend any money marketing or advertising an application when you're only making $7 per sale on 5-10 sales/day (and that's for a $10 app, most paid apps are $.99). In the app store, paid marketing doesn't pay-- you'll never recoup the money you put in. Only large development houses, or big companies with lots of ad dollars can play in that space. Alternatively, some developers have had luck with grassroots marketing efforts: exclusive previews on App Review blogs, posts to Facebook and Twitter, etc, but even these tricks have stopped working as the new mediums have become overloaded with sheer volume and corporate marketing "spam". And, of course, a few independents have done really well in App Store, but iPhone developer success stories are few and far between, as has been discussed ad nauseum over the past few months.
So then, what's a small, independent App Store developer like Sorth to do? We tried playing with our price, lowering it to $.99. Sure, we sold a few more apps, but not enough to justify the added support costs. Thus, we settled on a fixed price of $10-- high for an App Store application, but, we deemed, the only real sustainable price for a company our size. However, as we soon realized, the numbers just didn't add up: without the "free" marketing from the Apple promotions, the app slowly starting sinking in the rankings: from a high of #8, we're currently #106 in Paid Business Apps. It became clear that we couldn't make it as a company just selling apps (i.e. it's hard to feed the family on $250-300/week in revenue). Thus, we turned more attention to the other side of the business: mobile and web application consulting-- building apps for other people.
As a result, we're still here: we're still in business and able to turn a profit. But there's even better news: we're doing well enough on the consulting side that we can return to our true passion, the reason we started this company in the first place: to build intuitive, powerful and, of course, mobile, applications we sell ourselves. The fact that we can do this only by also doing outside consulting (in lieu of taking external investment dollars), says a lot about the real App Store economy-- but that's a topic I'll leave for another day.
I guess this is really just a long winded way of saying Timewerks is back and the best is yet to come. We're working on the next version, 1.7, and it has some great new features. We're planning on submitting it to Apple at the end of this month (November 2009) and we hope to see the new version in the App Store by mid-December. And, that's just the start-- we have big plans for the product in the next few months and we plan on introducing (finally) the full web-based companion in the first part of 2010. Stay tuned!
Thanks for your continued support and patience.
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