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What is the best method to predict sales for you iPhone app?

06-07-2010, 11:46 AM
#1
Junior Member [Original Poster]
Joined: May 2010
Posts: 4
What is the best method to predict sales for you iPhone app?

Hi all

I am an iPhone developer and my first app, Manga Rock, is already in the iTunes app store for 1 month. It is an iPhone manga reader with the source from Onemanga site. We have put a lot of time and efforts into developing it; thus, I just want to make sense whether the app will pay back our cost.

My biggest question is: how can we accurately predict the sales figures?

I am using the ATAR model to calculate the sales forecast. It works like this:

Step 1: Determine targeting population.

85 mil iPhone and iPod touch users --> 42.5 mil users who don't Jailbreak ---> 1 out of 20 users are manga lover: thus we are left with 2.125 mil user

Step 2: Apply ATAR method

A- Awareness: Let say after all the marketing efforts, we have 10% awareness rate among the base users
T- Trial: Let assume that trial rate is 30% since the app is free (with in-app purchase)
A- Availability: 100%, anyone want to download an app can easily do so with one click in iTunes
R- Repeat purchase: 10%, out of 10 user download the free version will actually buy it.

Finally, the total number of potential customer is: 2.125 mil*10%*30%*100%*10%= 2,550 customers

Say we gonna sell it for 1.99 USD, so the total revenue we can make is only 2,550*1.99*1.7 (apple cut)= 8,626 USD

This is bad news guys, I and my friends put into it almost 3 months each of development cost already. With this rationale, we can never pay back from this app

Can someone give me some light of hope? Or tell me that I was wrong in my calculation or something? I am really confused right now

Last edited by Koya; 06-07-2010 at 11:53 AM.
06-07-2010, 12:11 PM
#2
Joined: Dec 2008
Posts: 6,509
Before I begin, any mods out there, wanna move this thread?

Koya, the thing is, there's no sure-fire way to calculate how your app is going to sell. It could bring in better revenue than predicted, or worse. Manga isn't that mainstream a thing in the US yet, but you might find great sales in Japan. It all depends as the AppStore's market fluctuates.

06-07-2010, 12:51 PM
#3
I think its probably harder for apps then it is for games to measure expected success. With games I think you can make a semi accurate prediction, at least of how "out there" your game is via pre-release youtube views and your "upcoming game thread" here at TA. Though of course having poor numbers in either of those categories doesn't mean your game won't do well, it is still a good indicator and I think if they are high, you have a good chance.

We managed to rack up around 8-9k youtube views before release + around 13k total thread views, and sold around 500-600 copies a day for the first week before getting featured, which also boosted us of course for the next week.
06-07-2010, 12:53 PM
#4
Quote:
Originally Posted by Koya View Post
Finally, the total number of potential customer is: 2.125 mil*10%*30%*100%*10%= 2,550 customers

Say we gonna sell it for 1.99 USD, so the total revenue we can make is only 2,550*1.99*1.7 (apple cut)= 8,626 USD
Popular topic today, another guy looking for the same answers just a few posts down. As I said there, any number you come up with is only a guess. Some good and bad news for you:

Good news is the number of jailbreak users is FAR less than you estimate (under 5% from what I hear, not the 50% you estimate). That combined with the fact that less than half of jailbreak users are pirates changes your guesses a bit.

More good news, based on your own estimated figures above, you should be looking at 6,375 customers instead of 2550. Not sure where you get your number. I won't bother correcting for the true amount of non-pirate, non-jailbreak users here.

Bad news, your estimated amount is wrong: 2,550 potential sales * 1.99 is $5074.50, then you multiply by 0.7 for 70%, which is only $3,552.15 USD to you. If you go off the 6,375 figure which is correct based on your numbers, you still end up with $8,880.37. Accounting for the larger percentage of non-pirate, non-jailbreakers can increase that further.

Of course these potential sales numbers are all crap even if the correct calculations are done because it is impossible predict how well you will sell. What I *can* predict with some certainty: without a massive advertising campaign worth thousands of dollars and reviews at major iPhone and Manga websites, you'll be down to sell between 0-10 copies a day by the second week of availability. This is not meant to insult you or any hard work you've done on your app, this is merely the fate of 99.9% of all iPhone apps.

Back to watching the WWDC keynote for me

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06-07-2010, 01:22 PM
#5
Joined: Apr 2010
Location: the stars
Posts: 491
there isn't any. Never count your chickens before they hatch.
06-07-2010, 02:11 PM
#6
Considering the popularity of this topic at the moment ...... give me another five minutes and there'll be an app for that

(or maybe not )

More seriously one of the biggest things with sales is undoubtably getting word out there, whether thats by using an established brand, targetting users well through sites you know they travel to or just reviews its vital to ensure success (and getting features on the iTunes store doesn't exactly hurt either ).

PS - Is your app small enough to get under the non-wireless download limit (ie. 20Mb) - as I've always thought that probably has a bearing on the 'impulse' purchase side of things, although I have absolutely no numbers to back that up with.

Last edited by Marc Vaughan; 06-07-2010 at 02:14 PM.
06-07-2010, 03:30 PM
#7
As others have said, there is no sure fire method to predict sales. I will say that your ATAR method is totally incorrect in almost every aspect. You make a LOT of assumptions.

A- Awareness: Let say after all the marketing efforts, we have 10% awareness rate among the base users

I doubt you will not see 10% awareness among base users, even under the best circumstances. Besides this percentage is completely useless without a timeline and a proposed method to drive this amount of awareness. Getting Featured will help, as will using a free app site. But even those are not hitting your 10%.

T- Trial: Let assume that trial rate is 30% since the app is free (with in-app purchase)

There is that word 'assume'. Why aim so low? Let's assume 80%, or more realistically, 1%.

A- Availability: 100%, anyone want to download an app can easily do so with one click in iTunes.

Availability is not the same as accessibility. If nobody knows about your app, then it may as well not exist. People need to know it is available before they can get it.

R- Repeat purchase: 10%, out of 10 user download the free version will actually buy it.

While 10% is your target, not all apps can hit this mark. Flickitty was getting something like 50% conversion, which basically made my free version useless, so it was removed from the market and the sales went up slightly. Average is about 5%, but it isn't uncommon for developers to see a 1% conversion.

So in actuality, your numbers are being VERY optimistic and unrealistic. I'm not saying that you can't achieve the $8,000 you are now complaining about, I'm just saying that it can be much much worse. I think many developers would love to see $8000.

I maintain that the best method to 'guessing' your sales figures is to make a post here at TouchArcade, and monitor your page views. Those are unique page views that show the interest in your app. If you aren't able to get 500 page views, your sales will likely be below the $8000 mark. This isn't entirely accurate either, it is just based on some figure that I happen to have off the top of my head and they may be totally inaccurate today.

A ragdoll physics platformer:Flickitty
The artist: randall schleufer
Twitter: @FlickittyiPhone

Last edited by Flickitty; 06-07-2010 at 04:36 PM.
06-07-2010, 03:39 PM
#8
Joined: Mar 2010
Location: Chicago, IL
Posts: 137
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I agree on there being no sure fire way, personally I'd recommend trying to generate some more interest before you apply statistical models to the app store (for your first app), it also may be good to consider code-reuse and future applications using what you've learned over the 3 moths of work you and your friends have put in.
06-07-2010, 04:19 PM
#9
Joined: Sep 2008
Location: Washington, DC
Posts: 1,151
Well, your app has been on the store for a month now, so you've been getting daily sales reports. That's your best tool for predicting future sales. If nothing else changes, expect your daily sales to go down over time.

Since your app is free, if you don't have ads in it yet, definitely consider it. It's a great way to monetize a free app. And you can turn off ads for anyone who buys anything through IAP.
06-07-2010, 04:34 PM
#10
Joined: Sep 2009
Posts: 330
Quote:
Originally Posted by Koya View Post
Finally, the total number of potential customer is: 2.125 mil*10%*30%*100%*10%= 2,550 customers

Say we gonna sell it for 1.99 USD, so the total revenue we can make is only 2,550*1.99*1.7 (apple cut)= 8,626 USD
math...lol

Predicting sales is impossible until you have some reports of the apps performance. I've put apps out there that have sold 1 on the first day, other which have sold 200+ on the first day.

However, the first day numbers are only significant if you made no outside marketing efforts (such as I). This is because that number will show how many impulse buys and/or raw attractiveness your app can generate.

Apps that have sold above 200 for me on their first day have earned nearly 6 digits over the last 6 months

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