Yep, it's still happening. You can still become a millionaire on the iPhone without a marketing budget and a brand name. Occipital, the company behind RedLaser [iTunes Link], has struck gold with its barcode-scanning iPhone app. In case you haven't noticed, it's much harder to be an indie developer on the iPhone these days. The App Store is riddled with brands and much of the Top 50 selling apps are backed by marketing/PR budgets or legacy users (meaning they've been on the store since the beginning, and have an install base that can boost future app sales via cross-promotion). In fact, almost every developer I talk to nowadays says the App Store has become increasingly difficult, and that it would be “impossible to get noticed” if you just stuck your app in the store. Well, if you create a good enough product on the App Store, people will come, and they came to buy RedLaser – in droves.
RedLaser has been in the top 5 of the App Store paid apps for 3 months now, and got there without any advertising or marketing whatsoever. Co-Founder Jeff Powers says that though the app hit the market in May, it wasn't getting any traction. After releasing an update to the app which made it “actually work”, according to Jeff, they saw a dramatic increase in sales. This was despite the fact that they did nothing different upon the re-launch and got almost zero press pickup when they updated the app. The hypothesis is that this came entirely from word-of-mouth sales, which is probably a good bet. Who wouldn't want to show off to their friends the cool new barcode-scanning price-checking app on their phone? The chart below shows exactly how sales ramped up upon release of the update.
The staggering sales RedLaser was getting didn't stop anytime soon – they rolled through October, November and now half of December without ever leaving the top 5 apps on the store. It's common for apps to hit the top 10 and stay there for a bit, but 3 months is an extremely long run. We'll see if they can keep it up through the post-Holiday app frenzy. Regardless, TechStars startup and indie developer Occipital has shown that if you make a great product, users will still buy it.
With just two employees, Occipital has managed to rake in well over $1M for their $2 app, and are selling roughly 6,000 units a day. They are also getting strong press pickup due to the holiday buying season, with a feature on Martha Stewart Living earlier this week and as part of a front-page article on WSJ.com. They've seen more than a 1,000 sale bump recently, which they attribute to the Martha Stewart TV show.
RedLaser does a fantastic job of scanning barcodes on curved surfaces and in poorly-lit areas. I had a bit of trouble taking a picture of some barcodes because I have an awfully unsteady hand, but that was fixed by putting my elbow against my chest. RedLaser provides product search data from a products database called TheFind and nutritional facts from DailyBurn. The product database scans the stores near you (along with any online stores) to help you compare prices between what you're buying online and what is available locally. It works well, though it sucks that the database has no mom and pop stores because they often don't link to the product search companies' databases.
On top of RedLaser, there are 12 apps on the store that are powered by the barcode scanning technologies, including Good Guide, GroceryIQ, Corks and others. They get around $0.10 per download of those apps as well, which is a nice recurring revenue stream as more apps integrate their barcode scanning technology.
Jeff stressed that Occipital is a mobile computer vision company and that we would see even cooler things from them in the future. In the meantime, take a look at RedLaser on the App Store and make sure you're getting the best price on your holiday purchases.