Where do chart-climbing apps come from?

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sraman

App discovery is a known problem for all developers. Users typically rely on the top-selling app lists in their app store of choice as a guide for what to purchase. That, in turn, fuels sales of the same, already popular apps, making it that much harder for new apps (and developers) to break into these top app lists. And while there are curated app lists and some app search engines, the majority of new buys aren't coming from there.

So where do these new apps that break onto these top lists come from?

There's a trend I've noticed of late and it starts with AppGratis, an app that profiles one or more free or heavily discounted apps per day.

Take March 18, for example. AppGratis spotlighted photography app lo-mob, which was reduced from $1.99 to free, and on that same day lo-mob climbed to the third spot on the App Store's Top Free apps list. A similar thing happened on March 19: AppGratis' free app of the day, Scout, reached the No. 2 spot on the Top Free apps list.

This isn't unusual for AppGratis, which said that it regularly drives 500,000 to 1 million downloads for apps it works with. Last month, for example, the company worked to promote iOS game EDGE Extended and pushed 1,074,000 downloads in under a day. AppGratis' founder Simon Dawlat said AppGratis currently has 12 million users.

Services such as AppGratis (and its competitors like Appoday, AppRewards, Appsfire and FreeMyApps) use an interesting model. A premium app maker either heavily discounts the price of its app or, more often, makes it free for a short period of time. AppGratis features a write-up of the app and a link to download it, and its users are sent a push notification about the new app of the day. The app developer gets a bump to its userbase and usually pays the discovery service a cost per install (COI). The amount comes out of the developer's pocket, since that developer won't be making money selling their app through this promotion. "We have distribution deals in place with a lot of app makers, and we help these companies grow their user-base and their revenue. AppGratis has been profitable since day one, back in 2009, so it's safe to say that monetization is working out well," said Dawlat.

Monetization for the developers that sell these apps can vary. The key is to sustain the momentum gained from going free for a day. Appsfire CEO Ouriel Ohayon told MobyAffiliates that the worst thing for a developer is having a day or two of strong downloads, then having them drop off after the promotion ends. That's why some deals of the day spotlight already free apps but include a set amount of free in-app currency. This way, the user begins playing a mobile game, gets a taste of the in-app purchase, and is then more likely to purchase more in-app items in the future. How long this process takes depends entirely on the app.

On the user-end, it's a win-win, getting alerts for free apps that have also been "vetted" to be good. I think that is one of AppGratis' strong suits. The app summaries are written in a casual manner and read more like a recommendation a friend might write for an app than the general description given in an app store.

App discovery services like these follow a model similar to that of Groupon: inventory is drastically marked down for a short period of time. And while there have been a lot of comparisons between AppGratis and Groupon, there's one key difference. Dawlat said that with Groupon, companies with limited numbers of goods are flooded and become unable to keep up with the demand of fulfilling orders and selling items at a loss. With app services, he said, there are an unlimited number of copies of any given app. So, even if an app maker gets a large increase in app downloads, that developer won't necessarily be overwhelmed in the same way. Of course, these app makers will need to invest more in app maintenance due to the influx of more users (a cost that would sit on top of what they're paying to the promotion vendor like AppGratis) but the end result is more users that could end up spending money.--Sandhya

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