80 per cent of smartphone and tablet users download apps frequently and half have already paid for an app.
21 per cent would be willing to pay more than £5 five for one, with around two thirds saying they are happy to pay more than £1 if the app is good.
45 per cent believe the price-performance ratio for apps is cheap but 20 per cent would not pay for an app.
On average, respondents to the Simon-Kucher global consultants survey owned eight apps from the games category, and two each from productivity, news and social networks. The latter apps are used more regularly and new ones are not downloaded as often – only three games are used regularly and users spontaneously download more.
The study of more than 1,000 UK smartphone and tablet users found that 60 per cent are comfortable with the idea of in-app purchases, but freemium and ad sponsored models are considered more acceptable for games and productivity apps rather than news or social networking. 
The majority of respondents download apps once or twice a month – a figure they did not see changing over the next twelve months. App discovery was found to be influenced by ranking, price, as well as recommendations from family and friends.
“App users are generally very knowledgeable and willing to pay for good apps. The app range is however large, which is why there is no one ‘optimal’ price for apps,” said study author Annette Ehrhardt, senior director at Simon-Kucher. “But the experimental phase is over – for users as well as for providers.”
“Depending on how much value the app offers and the app category, providers may be overlooking their chance to earn more. Even if the basic version is free, the paid content version can be higher priced – thereby significantly increasing revenue.”
“Ultimately, providers shouldn’t wait for the one optimum price – it doesn’t exist. What works for one app may not work for another. Instead of looking to the others for direction, providers should pull out their calculators and start doing their own maths.”
