The Chasm in the App Store

August 05, 2014

Many thanks to Jared Sinclair for publishing the one-year sales figures for Unread. Real figures like these offer a rare insight into the App Store as a marketplace for indie developers.

Despite having excellent press and being featured by the App Store, Unread “only earned $42K in sales ($21K after taxes and expenses) and is on a course that doesn’t promise much growth”.

Half of the lifetime sales of Unread were generated in the first five days. It would take another 170 days (24 weeks) to generate that same amount again.

Jared also wrote a great follow-up post summarizing the responses so far to his sales numbers post.

This pattern of a spike followed by a long tail, is similar to what David Barnard saw last October for Launch Center Pro.

One of the reasons for this could be that there are two distinct markets within the App Store and we sometimes inadvertently limit our scope to just one of them. Of course, what I have here is only a hypothesis, which can either be a reasonable explanation or total nonsense. (Also note that I have zero experience selling anything on the App Store, as of writing this.)

The two markets

An app that solves a niche problem, or solves a problem or a need in a unique way, can be considered as a technology product in its own right. Applying the technology-adoption life cycle to such an app, we can say that the app would get adopted first by visionaries before the most of the pragmatists even consider it ¹.

Visionaries

The visionaries are generally the first to adopt an app. They are looking out for new apps to try out. They actively follow sites and tech blogs that review and report about apps. They discuss and compare apps in forums. They are open to trying out new apps that they find interesting, or apps that they think could be of use to them. They might even purchase multiple apps for a particular use case to try them all and find their best fit. If an app has a feature that requires a web service that they don’t use at present, they don’t mind signing up for it (or even switching to it) so that they could check out the feature.

Some of the visionaries are vocal about the app and help it reach a bigger market, sometimes even influencing the pragmatists. Seth Godin has a term for these visionaries who sell it for us: “Sneezers”. Tech writers are great Sneezers.

Pragmatists

The pragmatists are not really interested in what’s new. They have a problem or need that they want addressed. They come to the App Store with their problem in mind, or sometimes, based on a Sneezer’s recommendation of a solution to their problem. If the App Store has too many options for them to make up their mind, they would probably look for reviews and comparison articles.

They will have a set of features that they want, and mentally narrow down to the apps that support them, and pick one. They would prefer to be really sure an app suits their need before they part with their cash.

Pragmatists just look for a way to best solve a problem they have, and if there are multiple apps that solve their problem similarly, they would most likely pick the cheapest of the lot.

The chasm

In Crossing the Chasm, Geoffrey Moore argues that there’s a wide chasm between the visionaries (or early adopters) and the pragmatists (or the early majority):

The real news is the deep and dividing chasm that separates the early adopters from the early majority. This is by far the most formidable and unforgiving transition in the Technology Adoption Life Cycle, and it is all the more dangerous because it typically goes unrecognized.

Because these demographics are very different, the marketing of the app, sometimes even the design of the app, should also be different to address these two markets.

The following would make a good impact on the visionary crowd, but doesn’t make much of an impact on the pragmatists:

1. The app has something unique so that it stands out
2. Getting great reviews and press
3. Being featured in the App Store

However, doing these would help sell to the pragmatists crowd:

1. The app’s unique features offer value to a larger set of people
2. A detailed App Store listing showing all features of the app
3. Offering trials, possibly using a freemium model
4. Supporting all popular services that users of your app might want to use it with
5. Getting recommendations from Sneezers

Focusing on the visionaries is essential (because they are a great help in selling our product to the pragmatists), but that is not enough if we want the bigger pie of the pragmatists.

Seth Godin says, in The Purple Cow:

You must design a product that is remarkable enough to attract the early adopters - but is flexible enough and attractive enough that those adopters will have an easy time spreading the idea to the rest of the curve.

Finally

The first lesson in Jared’s lesson’s-learnt post is to “own a niche”. I think the way to own a niche, especially for an indie developer, is to concentrate first on impressing the visionaries and next to focus on the rest of the market.

The advantages are:

1. We can ship early (no need to support all possible integrations or workflows)
2. We can ship 1.0 as paid-upfront, and move to freemium later (controlled increase of support, and possibly easier to figure out what to keep free in the freemium offering)
3. We can focus on the marketing relevant to the market we are targeting

The spike in the sales graph is nearly the whole of the visionaries market buying the app in a very short period of time. So the fall of the spike is inevitable. But if we make sincere attempts to woo the pragmatists after the fall, the graph would hopefully settle down to a higher level.