Issue 480  October 30th 2020

Pricing is a vast, complex topic, and it’s hard to talk about in generic terms – it’s far too dependent on the product being priced.

Business models are easier to talk about, proven by the multitude of posts every year about paid-up-front vs in-app purchases vs subscription. Upgrade pricing, feature unlocks, I’m sure you’ve read plenty of them.

I really enjoyed Jacob Eiting’s post the 85%/15% subscriptions revenue split this week. The reduction in Apple’s cut for subscribers that stay subscribed for more than a year is sometimes cited as a benefit over other business models, but how much difference does it actually make? It’s hard to say for sure unless you can see aggregated data coming in from a huge range of subscription-based apps – which is where this post comes in useful! You should read the whole post, but the tl;dr is that unless you have incredibly low churn rates, the reduction in cut probably isn’t affecting your bottom line much.

I’ve often said that I feel that it’s far more beneficial to concentrate on growing your business rather than worrying too much about Apple's cut, and I think this article reinforces that point of view. Just as there’s no “best” price for an app, there is no “best” business model. Don’t be tempted to think subscriptions are the best way because Apple’s cut reduces, or because it’s what everyone else is doing. Not every app is well suited to a subscription business model.

It’ll seem obvious if I say that the best price for your app is different from the best price for other apps. That’s obvious! I’d suggest thinking about business models in the same way. Base your choice on how you think your app will be most successful, not what’s fashionable or the possibility of a potential reduction in Apple’s cut. Getting both price and business model right will make a much bigger difference than any percentage cut in the long term.

For full disclosure, RevenueCat (which Jacob is the CEO of, and who’s data this blog post is based off) has previously been a sponsor of iOS Dev Weekly. However, I wrote about this post purely because I found it interesting. They did not send me a link to the post, I read it via their RSS feed.

Dave Verwer