Thoughts on ads in App Store search

April 23, 2016

Bloomberg reported earlier this month that Apple is thinking about paid search on the App Store:

Apple is considering paid search, a Google-like model in which companies would pay to have their app shown at the top of search results based on what a customer is seeking.

Most responses to this rumour were rightfully critical of Apple for trying to make even more money off the App Store, at the expense of customer experience.

Actually, ad-like stuff already shows up in App Store search. If you search for “podcast player” right now in the App Store, you get an ad for Apple’s Podcasts app right on top, and the search results below that. (However, I don’t know of any other app that’s promoted this way. Anything else you’ve spotted?)

I think if Apple does implement paid search, we will have something similar, but with smaller screen space for each paid result and each of them being clearly marked as “Ad” or “Sponsored” or some such thing, similar to what Marco Arment talks about in footnote #3 of his post on this topic. At the maximum, one screenful of paid results, and normal results accessible by scrolling down.

Apps with a big marketing budget, usually backed by a big company, can afford a permanent paid placement, so searching for “free games” might end up showing a “Clash of Clans” ad pretty much all the time.

Indie apps might experiment with paid search – if it’s not unreasonably expensive – for a short period of time (e.g. for launch week). That would offer an app a chance to break into a market with established incumbent apps, indie or otherwise, by making the app or update known to more people.

In Google AdWords, ads relevant to the keyword are charged less per click and irrelevant ones are penalized. Assuming App Store search ads will work similarly, it probably wouldn’t be unreasonably expensive as long as the ad is targeted at keywords relevant to the app, and there isn’t too much competition in that space.

Marco also says:

More significantly, we could buy increased exposure to the most likely customers to buy our apps. More paid-up-front apps could become viable, and prices could rise.

I don’t agree with that last statement, though. The problems with the paid-upfront model are:

• It’s hard to convince a customer of your app’s worthiness before she gets to use the app
• In many scenarios, the customer has a free alternative that could do the job, though it might not always do it as well as your paid app

Neither of these are addressed by ads in search.

Paid results in search would help improve discoverability for all apps, whether paid upfront or not. Converting discovery to a download will remain much harder for paid-upfront apps than for free-upfront apps. For example, if a free-upfront app turns up as a normal result after a paid-upfront app’s search ad, and both apps solve the same problem somewhat similarly, the search ad would turn out to be pretty useless. Therefore, I don’t think ads in App Store search can improve the viability of paid-upfront apps being able to sustain themselves.

Going forward, indies who want to make a living on the App Store have to market their apps, and might even have to spend for it. I’ve never placed an ad for my apps ¹, but have seen many ads for indie apps in blogs and a few on Twitter. App Store search ads, if it comes and is executed right, would be another useful marketing tool available to us.

Apart from the direct impact, search ads would help bring in a constant revenue for the App Store, which I hope can be used to bring in more and better human curation, which would be awesome for app discoverability.

The Bloomberg report also said:

In addition to paid search, the team is trying to improve the way customers browse in the App Store.

One can hope, right?