If you plan on developing an app, when you think about pricing, the first question that comes to mind is, how much should your app cost?
Creating an app can require significant time, effort, and financial resources. With a large number of apps available in the Apple Store and Google Play, it may be difficult to find a niche market or specific function that your app will have. That is when pricing becomes essential.
The pricing strategy of an app is how one decides the price at which they want to sell the mobile application or what price should be set for an individual application. Mobile app pricing is one of the difficult and crucial elements of mobile app development. It is a must to apply the correct pricing strategy if you want your app to get noticed on the app store. There are many factors to consider when selecting the right pricing strategy for your mobile app. In this article, we will explain the necessary actions and analyses you can make for mobile app pricing.
Get Started on Determining the Pricing Strategy For Your App
Pricing is just one of the many factors that contribute to a subscription-based app’s long-term success. Other variables include the existence of similar offers on the market and customer purchasing power. If a customer has a strong preference for your product, they may be willing to pay more. By testing different price ranges, you can determine what price yields the highest profit margin.
Before conducting a pricing test, the first thing you should do is define a testing objective. What kind of outcome do you need for your next strategy? You can choose an objective such as increasing your conversion rate or lifetime value, decreasing your acquisition cost, etc. After deciding on an objective, you should create different hypotheses to help you reach the outcome you need as the next step. For example, “If I create a trial, I will lower my acquisition cost” can be considered as defining a target.
It’s important to take a look at the previous pricing strategies that’s been used in your app. Which prices worked the best? The outcomes also change for each country. As Cherry, we’re looking at the database of your app and analyzing all the prices that have been tried before for each country. This approach shows us what kind of strategy works best for your app. It also helps us see where your app is standing in terms of pricing, and how to take the next step. 
After seeing and analyzing the results, it could be best if you can predict the conversion rate and lifetime value of each package. If you can’t, working with a professional pricing team can help you get a long way on your pricing efforts, and reach the maximum results.
After the analyses you’ve made, you can start your testing stage. In this step, you should conduct A/B tests. But what’s an A/B test?
A/B Testing
A/B testing is a user experience research methodology.* This method provides a way to compare two versions of a single variable, such as comparing variant A against variant B to see which performs better. In this case, you can compare the two different pricing you’ve created for your app. As a result, one variant will outperform the other, so you can see which version will convert better.
A/B testing is used to identify the best possible user experience and deliver the best possible results. A/B testing is particularly useful when it’s used to target mobile app users based on a specific geographic region or country. You can use this test for your ads, as well as your pricing strategy. For example, by exposing two different prices to two smaller but similar audiences, you will see the outcome of each and use the one with a higher conversion rate. Thus, you can reach the best possible outcome for your pricing strategy.
When the test reaches out to enough users, it can be closed. When you compare the previous outcome with the result of the test, you should see an improvement to end your test successfully. The improvement rate should increase at least 20% or more. And after that, you can use this new proven way as the next strategy for your mobile app. And change the prices accordingly on each country you’ve made a test on. And now, your app will be stronger and you’re ready to reach more installs and subscriptions!
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The pricing strategy of your mobile app depends on various factors like the target market, team size, quality and features of your mobile app, etc.
You may have also read that you should determine the end value of your app to be able to set the right price. The only problem is that if you have no idea how to calculate the value of a particular app, then figuring out a profitable price may be a hard task to take.
If you are on a tight budget, you can work with a publishing company like Cherry.
Cherry works with a partnership model that allows qualified mobile apps to reach their target audience, without the creators of the app spending a dime. Since marketing a mobile app is an expensive job that requires expertise from several fields, you will be able to make the most of your app and reach your users worldwide.
So, if you are interested and would like to know more,
please drop us an email: “hello@getcherry.app”
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