Disclaimer: I’m the creator of AdDuplex. That said the thinking outlined in this post is what led to creation of AdDuplex and not the other way around.
From Zero to Hero
Obviously money is not the main and/or only reason most of us are in business of creating of Windows Phone 7 apps. That said getting paid for the time we spent on creating that nice app is what most of us wouldn’t mind at all. But here’s a news flash. A sad one, I must add. Not even the top independent WP7 publishers have bought themselves nice Lamborghinis with WP7 money.
Most of the developers of top WP7 apps are doing OK for a side gig, but not more than that. And most of them were there at launch and gained their momentum from being one of the first apps in their respective category.
Back in December, 2010 Jeff Webber has posted some sales numbers for Krashlander – one of the top paid (if not THE top) indy games on WP7. The numbers are obviously a little outdated, but unless you are sitting on something you consider deserving to be a supermegahit, you should look at these numbers as top limit for the nearest future.
Sigurd Snørteland has posted download and sales data for his 4 apps more recently in addition to previously posted data. His Tetris7 game is #12 free app at the time of this writing. Meaning it’s close to the maximum possible downloads for the app at the moment. His cumulative download stats show that Tetris7 had an install base of not more than 170,000 on January 8, 2011.
Considering that each of these installs shows 1 ad per day on average (which is wishful thinking, imo) and he gets $1 per 1000 impressions this results in about $170 per day or about $5000 per month. Not that bad until you consider that this number is based on wishful thinking and it’s one of the top apps. Plus it’s Tetris and I’m still not sure how legal the game is anyway.
And I’ve posted my more than modest numbers for Tic-Tac-Toe 3D. Consider that free version is #606 free app in Marketplace (#726 overall) right now.
Which is still in top 10% of the apps in the marketplace.
You can see the picture, so make your own conclusions.
Go Free, Ad-less or AdDuplex
During gold rush periods people tend to forget general business rules. If you are in it for a long run your goal at launch should be building reputation, buzz and as a result popularity for your app, not turning a profit.
So, unless your app is a novelty app or related to some specific event in time, I would strongly argue that your best bet is going free right now. Remember that you can switch from free to paid later, but not the other way around.
It’s probably not wise to run paid ads at the beginning either, considering that the returns won’t be sizeable at first and overall situation in advertising space on WP7. By far the most income generating ad network on WP7 is Microsoft’s own pubCenter but it’s limited to USA (both developers and users) and even US people experienced some issues getting signed up. Other networks seem to be working on pay-per-click (not per-impression) basis and don’t generate any substantial revenue according to reports from developers using them.
In the R.I.P. GooNews blog post in addition to describing issues with pubCenter Shawn Wildermuth writes:
I went with AdMob to serve ads. The experience there isn't great as their pay model is per-click not CPM (so I haven't received any revenue from GooNews' ads) but at least they were serving ads across the world, not just in the USA.
So, basically there aren’t many options for generating reasonable revenue from the free app at the moment anyway. And, as I stated above, I would argue that this is not what you should be thinking about at this point in marketplace evolution.
So I’d say either go ad-less or use the ad space to promote your own apps, products or services. It is wise to be prepared for the moment when your app gets popular enough and the number of phones in the market increases to the point when it makes sense to try and make money from the advertisements. When that time comes you might find yourself in a situation when there’s no screen real estate you can dedicate to ads. So think ahead (but don’t overthink) of a place you can incorporate the ads if you decide to go ad-supported.
Another option is to use the advertising space to get free promotion for your app by helping other developers promote their. I’ve created AdDuplex with that particular idea in mind and that what it does. Once you are ready to make money from your app you can intermix AdDuplex ads with ads from commercial network of phase it out altogether. But for the time being popularity of your app is what you should be concerned with the most. This is how I see it.