BII REPORT: Here Is Apple's Huge Opportunity In Paid Mobile App Search

app store downloads

Ever since Apple introduced the App Store—and with it, the mobile app—in 2008, growth has been enormous. If the current growth rate holds, 25 billion apps will be downloaded in 2012.

With that growth, however, has come issues. There are now more than 650,000 apps in the App Store. Navigating that unwieldly maze has emerged as a major issue for developers and consumers alike.

In a new report from BI Intelligence, we analyse the current difficulty in navigating the App Store, how search is an increasingly important tool for finding apps, why app developers are desperate for new promotional strategies, and how Apple introducing search ads in the App Store could have huge benefits to developers, consumers, and Apple alike. 

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Here’s a quick breakdown of why paid search could work for the App Store: 

  • The “Top 25” App Store list is not the holy grail that its made out to be: Getting into the Top 25 is obviously huge for individual apps, but it is diff cult. At the same time, Nielsen found that 63% of consumers use search to find new apps in the App Store and, according to Flurry, apps outside of the top 100 will account for 68% of app revenue in 2012.
  • All of which presents a familiar conundrum: App developers are desperate to promote their apps, but right now their options are limited. They can do paid campaigns on external networks or in-app advertising, but neither offers effective returns. In turn, better app discovery would clearly benefit app consumers.
  • Apple needs to solve the problem:  As we discussed in our mobile platforms report, developers market share is the key to the mobile platform wars and, as such, it is important to keep them happy. Apple bought app search platform Chomp in February in a likely effort to begin to rectify this situation and revamp app discovery and distribution in the store. 
  • Mobile paid app search could change everything: Search advertising offers the best solution for all parties. Developers get a dynamic promotional channel with a clear impact. Mobile app paid search would clearly drive conversions, and could increase engagement with apps. For Apple, App Store search ads would strengthen its fledgling iAd product, sharpen its reputation as the most developer-friendly platform, and prevent rivals from staking out a claim on its territory.

In full, the report:

  • Details the current state of search and discovery in the App Store
  • Explains how App Store advertising could work, and how it would benefit app developers and consumers alike
  • analyses the potential payoff for Apple in the form of mobile advertising revenue and App Store dominance if they could successfully introduce such an option

To access BI Intelligence’s full report, sign up for a free trial subscription here.

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