If you’re trying to make or thinking about making some money on Android, it’s important that you understand the stats available to you on the Android Market and what they mean in terms of real income potential. Yes, there are those mega hits out there to entice you to blow all your free time developing and publishing an app, but before you go through all that trouble, you may want to take a look at the spreadsheet on the right.
The number that gets people excited is number of downloads. Yeah, sure, we’ve all downloaded apps, but in many cases, we uninstall the app almost faster than it took to download. Maybe we don’t like it. Maybe it crashed on us. Who knows? In any case, that still counts as a download – and that’s the same number that everyone else sees as well. It’s really misleading, but many potential app users don’t know that. All they know is that a gazillion people have downloaded it.
The other statistic that only developers get to see is number of active installs. I refer to this number as “retained” in the chart. The word “active” is somewhat misleading, as not every app will be “actively” used on a daily basis. Some apps are, but that doesn’t mean that your app is going to be that popular. Google doesn’t publicize what the active install percentage is across the entire Android Market, as I’m sure that if that number were to be made public, it would discourage many people from ever developing an app.
The next set of numbers I have in the chart are “Retained that purchase” and “Income after Google cut”. That income figure is based on a $1.99 (USD) app. The Android Market does not provide the “Retained that purchased” figure. I came up with that number based on having both a trial and pay version of an app. I put in columns for 2%, 3% and 4%. Only a small percentage of Androidians that love your free/trial app are actually going to buy it. Let’s not fool ourselves here. Everyone knows that less people buy apps on Android than they do on the iPhone.
The four columns on the far right represent a free app with ads. These numbers are also not provided by the Android Market. You can use Google Analytics to determine actual usage per day, which I don’t do. AdMob gives you number of ad impressions per day, but that doesn’t really determine actual usage per day. I just slapped these numbers together based on number of impressions and some revenue figures. Not very scientific, but good enough for my purposes. As stated earlier, not everyone may use your app on a daily basis, so you really can’t count on downloads to translate into potential ad revenue. Not only that, people have to click on the ads for you to actually make money. There are some exceptions to this, but this is the general rule. If you’re looking to make the same revenue as Angry Birds, don’t hold your breath. How often do you intentionally click on ads?
Your app may be wildly popular and make you millions – or not. You should whip together a spreadsheet like this, play with the numbers and figure out how wildly popular your app needs to be before you start to see some income that will put a smile on your face.
Every app we develop has an opportunity cost. If you’re just sitting home watching TV, then by all means, develop an app! But if you’re giving up quality time with family and friends in hopes of becoming independently wealthy, you might want to think twice about what you’re really giving up in the pursuit of money.