The Impact of Large Scale Promotions on the Sales and Ratings of Mobile Apps: Evidence from Apple's App Store

Mobile apps is a highly competitive market and promotions is a way for apps to gain word-of-mouth. Our work tries to quantify the benefits and risks of various promotions and suggest ways to design them in ways that amplify the benefits and mitigate the risks. We study four promotions offered on Apple’s App Store that vary in scale, price discount and redemption procedure. We find that each of these characteristics has a unique effect on the sales and ratings. Promotions that are digital (i.e. very easy to redeem) and full price discounted are the ones that attract the largest audiences alongside with the largest disturbances on the ratings, whereas making the redemption of a coupon slightly harder or offering a non-full price discount will cause a lesser increase on sales but can help filter out potentially sub-optimal user experiences and the reviews that come with it. ∗[email protected] 1 ar X iv :1 50 6. 06 85 7v 2 [ cs .C Y ] 2 4 Ju n 20 15