How to Profit from Your iPhone App Idea

So you’ve come up with an idea for the next big iPhone app, but you’ve never written a line of code in your life. Not to worry! There are app developers out there looking for good ideas and willing to partner with you.

You contact the app development company, discuss your idea with them in general terms, and see if they’re willing to partner with you. If they like your idea and think it is worth their time and money, they’ll negotiate a deal with you where they’ll develop and market the app, and you’ll receive a percentage of each app sold. Your percentage depends upon how much you put into the project; it could vary anywhere between 5 and 25 percent. (Remember that Apple takes a 30 percent cut off the top for any app sold through the App Store.) However, if you have a great idea, you can still make thousands while someone else takes all the risk.

How do I know if my idea is good enough?

When you’re pretty sure you’ve got a great idea, discuss it with a developer. Most will let you know right off the bat if they think it has potential. One developer, MEDL Mobile (, offers a free iPhone app that will let you vet your idea and see how it rates in terms of value, fun, and profitability.

Unfortunately, nine times out of ten, someone has already created an app based on your idea. But don’t let this discourage you. Take a look at existing apps and ask yourself how your idea can lead to a better one. What is missing from the existing app? How can you improve upon it in terms of functionality and value? Make sure you carefully read reviews of the existing app. Focus on comments about the app’s weaknesses and improvements that are needed.

Don’t get greedy

Remember that it’s easier to come up with a great idea than it is to create a great app. It takes a lot of time, energy, and programming/design expertise to create one. And even after it’s been accepted by the App Store, success isn’t guaranteed. You have to market the app so that potential customers know that it exists. The costs associated with the creation and marketing of a successful iPhone app can be significant, and you will have to share the profits with the developer.

The price of your app needs to be competitive with the marketplace. You can sell games for $3-$10, simple utilities and apps for $1-$3, and specialty apps for more. Your partner probably has more experience with pricing than you do, so trust their advice on this.

You can also look inside the App Store to find developers to partner with you. The developer is listed with each app in the store, and a link to their Web site is provided. Look for the apps you love; the ones that were well executed. Then click on the developer’s link and look for a contact e-mail address. Send them a brief message, asking them if they are looking for app ideas and are willing to partner with you.

Protecting your idea

Practically speaking, you don’t have to worry about the developer stealing your idea because it would be extremely bad for their business. One letter sent by you to the right blogger or columnist and the company would be dealing with a PR disaster of epic proportions. That said, it is reasonable to take some precautions:

  • Be extra cautious with overseas developers. There are some bad apples that will take your idea and refuse to compensate you for it. I would only go with one that I was referred to personally.
  • Research any developer before working with them. Is their Web site well organized and reputable? What do others say about it? Do a Google search on them and see what comes up.
  • Ask them if they have done this sort of partnership before and ask for references.
  • Keep printouts of all e-mail and documents.
  • Ask them to explain how they will market the app.
  • Find out what kind of percentage you can expect and how long it takes them to send you your share of the profits.
  • Ask to have your name listed on the credits screen.
  • Get everything in writing and in an e-mail.
  • Seek legal advice before signing any contracts.

App demand is growing

The odds are that your app will not become the next top sell on the App Store, but don’t let the odds (or skeptics) stop you. Apple just surpassed the one billion mark for App Store downloads, so there’s plenty of demand out there. Even if an app based on your idea is downloaded only 50,000 times, you could still make $5,000 to $10,000 on it (and possibly even more).

To date, over 37 million iPhones and iPod touches have been purchased throughout the world, and that number will only increase with time. Apps are red hot right now, and the demand for original, inventive, and fun apps will continue to grow, even in these tough economic times.

So get off your butt and come up with a great idea for the next must have iPhone app!

Determine if your idea is good and find a developer to help you create your app.
Summer 2009
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