Apple Apps store (Are developers making money from it?) and Experience Design

During WWDC when Jobs launched the new iPhone 3G and everyone gasped at the "low" price, I was more interested in the Apps Store. At 5am, when I was listening to the keynote on a Qik stream, I had the "Eureka!" moment.

I used to work at a Research and Innovation Centre which did research work in Experience Design (XD) - an area of study popularised by Shedroff / Pines & Gilmore. In a nutshell, XD speaks about how every brand / product / service can be commoditized and there's a limit to profits you make from any brand / product / service.

There is more money to be made by selling the "experience cloud" around your brand / product / service especially AFTER consumers have purchased your product / service. You do this by introducing moments of engagement or touch points, so that the consumer will continually be reminded of your brand / product / service throughout their daily activities. The more "moments of truth" you can embed between your offerings and the consumer, the more successful your offering will be.

Apple are masters at doing this. Think iPod, iPhone, Macbook, iMac, iTunes Music Store, Apple TV, Apple accessories to complement your Apple products, and now Apps and MobileMe. They do this with heavy engagement between Ethnographers and Users of their products.

When I was at P&G, "Moments of Truth" are firmly etched in their brand philosophy. HP is another company to lookout for (reaching out to bloggers, marketing their PCs as a lifestyle necessity instead of a PC). Locally, I might also add that Singtel is slowly and steadily adopting this strategy.

The new iPhone 3G / iPhone 2.0 software really hit the nail. At a micro-level, how much profit can Apple make from selling an iPhone, after sharing with AT&T and overseas cellular providers?

Now fast forward to the Apps store and MobileMe. Sure, they have made a profit off you buying the device / call plan etc, but in order to generate continuous income, tadah! Apple presented the Apps store / MobileMe.

Either way, Apple earns. Selling the phones (Friggin' 1 million sold in 74 days) and selling the apps (10 million downloads) / pushing the convenience of the cloud.

Before I do the summary of TechCrunch's post, here's something you / your business should keep in mind.

Do not just sell products / services. Because products / services can be replicated, cheaper, faster, better than what you provide. There has to be an "sticky" factor for people to want to keep using your offering and more importantly, willing to pay more to enhance the initial investment they've made in the first place because they want to, not because they need to.

Back to the main reason for this post:

Development house taptaptap has just publish sale figures of their iPhone app. WhereTo retails for US$2.99 in the store and 24,094 copies were sold in the first month - netting the company just over US$50,000 in revenue after Apple took their cut (it currently ranks #69 on the top paid application list). Tipulator retails for US$0.99, and sold 3,168 copies which resulted in just over US$2,200 of revenue (it is currently unranked).

So question - If their products are ranked #69 and Unranked, how much are the top paid apps developers making? The current list can be found here.

Go figure...

Image Source taptaptap.
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