tap tap tap, makers of the excellent iPhone app Cam+ with a very interesting commentary on why they don’t advertise the app:
If you’re looking to ads for shorter-term profitability, be very cautious… I’ve made the mistake in the past when I was creating Mac software where, for months on end, I threw back almost all of my profits into keeping the ads going. Although sales did grow, profits didn’t because most were being pumped back into paying for the ads. It’s a vicious circle.
The bottom line is that there are much more effective things that you can be doing to promote your products and this is where you should be focusing your time, energy, and money (some of these things could make for good future material here).
It’s all about the marginal cost of advertising. Obviously bidding $2 for a keyword when you sell an app for $1.99 means you’re barely breaking even to acquire a new customer. You have to do the math.
I wouldn’t completely discount the importance of advertising, but being someone who works at what is essentially an ad network, I can tell you that many customers don’t take the time to evaluate the performance and link back the ROI of their campaign. They just have marketing dollars to spend and they do it.
When it comes back to tap tap tap, they wrap with an excellent point:
Don’t believe me on any of this? Well, there’s a dead-simple way of confirming it… check out the apps that are being advertised in the places I’ve mentioned and see where they’re ranking in the App Store charts.
However, I wouldn’t be so naive to think that from scratch you can create an amazing app and just sit back and hope people find it.
I’ll be looking forward to part 2 of their post.