Last year, with the release of iOS8, Apple added App Bundles, a new way to (hopefully) increase revenue by bundling together apps and selling them at a discount.
In theory, App Bundles looked like a super simple way to increase revenue. After all, who wouldn't want to get more apps for less money (per app), right?
A year in, we can see that App Bundles can be great, if you can leverage them properly. Armed with data, let's take a look how you can do that.
We conducted an analysis of App Bundles in 2014 that showed some impressive growth numbers, so lets start by analyzing the existing landscape and comparing it to last year.
More than 10,000 App Bundles are currently available on the App Store, up from 4,500 available last October. What does this mean? It means that they're being used but not as much. Actually, new App Bundles are responsible for a little less than 1% of all App Store growth in the last year.
If we take a closer look, we can see that most developers who are leveraging App Bundles only have one App Bundle in the App Store. A reminder that App Bundles are a sales tool that isn't as easy -- but not impossible -- to master.
Who's succeeding with App Bundles?
Games and education apps (which are mostly educational games), make up roughly 45% of all App Bundles that are currently available for sale.
Games are a great example for what apps to bundle because they're usually purchased and played for shorter periods and the more variety the better the experience for end users. If you're a game developer don't run to iTunes Connect to bundle your games just yet however.
While App Bundles including games are most prominent, keep in mind that game downloads are usually impulsive and with so many Freemium apps available there's a lot of competition. Keep reading (or scroll down quickly) for a few tips on what makes for a good App bundle.
App Bundles can contain between 2 and 10 apps. Let's see how existing bundles are distributed:
Most App Bundles currently contain exactly two apps. Looking at the top 3 cohorts, 2, 3, and 4 bundles make up roughly 70% of all active App Bundles. This makes sense considering many developers are probably still experimenting with their bundles. It could also mean users don't want to buy too many apps at one go.
One important thing to note however is that the more apps a bundle contains the higher the discount. Where bundles with 2 - 4 apps save $2 - $5 on average, apps with 7 or more apps save more than $10 on average, and the largest possible bundles, containing 10 apps, save an average of $14.
Many factors are making selling paid apps (and bundles) more challenging. In addition, most app store downloads aren't planned and are more impulsive. Those two combined together make simply selling more than what the user needs challenging, even when a discount is applied.
- Create a theme for your bundle - Users are happy buying multiple apps together whn they suit a specific set of needs. This makes lots of sense because complimentary apps are usually purchased together on a after the other. Use this to your advantage and bundle apps you know are being bought by the same users. Apple does not limit the number of App Bundle a developer can release, so create as many App Bundles as you need to remain thematic.
- Discount according to the number of apps you bundle - As you saw above, users expect a higher discount when buying more apps. This means that, when bundling your apps, either opt for a small bundle (more popular) of 2 - 4 apps, or bundle as many of your most expensive apps together with a steep discount. This could get you more users who wouldn't have download those apps before given their price.
The following are strategies that may sounds good in theory but don't work on the App Store:
- Bundling apps that aren't related - More variety = better offering, right? Not on the App Store. Because many app purchases are impulsive and done in the moment, users don't like buying more than they need, even when there's a discount involved. By mixing apps that aren't related, the user will feel like they're paying more for apps they don't even want, and thus move on to the next available search result.
- Bundling paid version of freemium apps with in-app purchases - The reason freemium apps are successful is because they reduce the perceived risk. By turning them into paid apps and including some in-app purchases, you're reducing the price to those users who know they want the app but effectively increasing the perceived risk for everyone else.
- Bundling too many apps - Similar to the first point, users don't want more than they really need and bundling more apps will usually mean a higher price. Users rarely look at the price of a bundle by dividing its price by the number of bundled apps, so the actual lower per-app price you intended to show is perceived as a higher expense.
Experiment, Iterate, and Optimize
App Bundles are a great sales tool available to developers. Many developers who leverage App Bundles correctly have access to new revenue and a larger user-base. As with most sales channels/tools however, positive results require proper tracking, iterating, and constantly tweaking. Using the tips above will get you started, the rest is up to you.