A recent study finds when app developers lower the price of their apps, revenue increases up to 8X. The company surveyed 850 iPhone and 930 iPad apps that had changed price at least once in December and studied the effects when this price changed between $1 and $3.
Dropping the price of an app can also have a significant impact on developer revenues, with a one-week discount helping iPhone and iPad app revenues increase by 159% and 71% respectively over the same period.
However, while price drops encouraged new users to download apps and in turn boost developer revenues, the opposite was true when app developers upped the price, the report reveals. Distimo says that app downloads for iPad (57%) and iPhone (46%) dropped by almost half when app prices were increased.