How to price a small app or digital tool

This article is about choosing the number and the currency, not about whether the product should be paid, freemium or a subscription — that choice is in Paid, freemium or subscription — and not about what it costs to build, which I have already written about in What an iOS app really costs. There are no price lists here, and no invented conversion rates.

Price is a product decision you can change

A price tells a story. Too low, and a careful person wonders what is missing, or you cannot afford to keep the product in good order. Too high, and you need the product page, the first run and the reviews to do more work than they are ready for. Neither is a moral failure; both are information.

The useful habit is to treat the first price as a hypothesis:

• you can say why you picked it, in a sentence
• you can live with it if it stays there for a year
• you know, in advance, what would make you raise or lower it

Write that sentence in a brief, even if you are the only reader. The Website Brief & Quote Builder is a reasonable place to put “the product is X, it is for Y, it costs Z because….” If you cannot finish the because, you are not ready to put a number on a store page.

You also don’t have to price the same way for ever. Stores let you change a price; going down is easier to explain than a sharp jump up, but both are possible. The cost of a change is communication, not a metaphysical lock.

Start from costs and from the job the app does

Two starting points should both be in the room, and neither should win on its own.

Costs first, honestly. List the costs that continue after launch: your time for support and OS updates, Apple’s membership and commission (check the current terms), any servers, any contractor, and the tax treatment you have actually confirmed. What an iOS app really costs is about the build; this list is about staying alive. Divide those ongoing costs by a conservative number of sales or renewals you would still be satisfied with, not by an optimistic chart-topping fantasy. The result is not the price. It is a floor, below which you are donating the upkeep.

Value second, also honestly. What job does the person hire the app to do, and what would they use if it did not exist? A notebook, a spreadsheet, a human specialist, a more expensive suite, or nothing? You are not pricing your late nights. You are pricing that job. A small tool that saves a professional an hour a month can fairly cost more than a charming novelty, even if the novelty took longer to build.

If the two starting points are far apart — the floor is above what the job will bear — the problem is the product, the audience, or the upkeep, not the absence of a clever price ending in 99. Narrow the MVP, cut a cost, or pick a different audience, before you invent a “growth price” you will resent.

The Performance Budget Calculator is a cousin of this exercise in another domain: you set a budget, then you see whether the design still fits. Here the budget is pounds and hours.

Price points people already understand

People already have a set of numbers they are used to seeing on an App Store or a small web checkout. A price that sits on one of those familiar points is easier to judge than a precise figure you arrived at from a spreadsheet (£4.17 or $7.40). I will not publish a table of “best” tiers, because the available tiers and the way they display in each storefront change, and because I will not invent a psychology study about endings in 99.

What I will say:

• Prefer a number the store already treats as a tier, if you are selling through the App Store, and look at it on the product page rather than only in a worksheet.
• Round, short numbers are easier to talk about in a subtitle, a review and a conversation: “it’s four pounds,” “it’s ten dollars a year.”
• Don’t price a serious tool at a novelty figure if you then cannot afford support, and don’t price a tiny novelty as if it were a professional suite.
• A free app with a one-off unlock still needs a number that makes sense for the unlock, not a leftover of whatever you almost charged up front.

If you also sell a download from your own site, you can choose a number the App Store does not offer, but then you have to explain why the two channels differ, if they do. Don’t assume people will not notice.

Use the Word Counter for the one-line price explanation on the website (“A one-off purchase, including updates for this version”), not for the number itself. If the explanation needs a paragraph, the offer is too complicated.

Pounds, dollars and what a store displays

If you are a UK seller, it is natural to think in pounds. The App Store, though, shows a local price in each storefront, and Apple’s pricing tools let you start from one currency and generate the others, or to set storefronts individually. What a person in the US, the EU or elsewhere actually sees is the local display price, not the number in your head.

So:

• Decide which storefront you are really pricing for first — usually the one where you expect most of your customers, or the one whose currency you think in — and look at the generated prices elsewhere before you announce a launch price.
• Don’t chase a perfectly round number in every currency at once. You will go mad, and the store will still show tax-inclusive or tax-exclusive figures according to its own rules.
• Check the live product page, or App Store Connect’s pricing view, rather than multiplying by a remembered exchange rate. Rates move, and the store’s tiers are not a foreign-exchange desk.
• If you sell from your own site in pounds, say the currency clearly, especially if you have an international audience.

There is no moral duty to charge “the same” everywhere in a way that ignores tax and the store’s tiers. There is a duty not to be surprised by what a customer sees, and not to advertise a sterling price as if it were universal.

VAT and the number on the product page

VAT, and similar taxes in other countries, can change the number on the button and the amount you receive. Who collects the tax, and whether the displayed price includes it, depends on the channel (App Store versus your own site), the customer’s location, and your registration status. I have written a map of that, clearly not as tax advice, in VAT when selling apps and digital products in the UK. Confirm the current rules with HMRC and with an accountant; don’t bake a remembered rate into a price you then forget to revisit.

Practical habits:

• Look at the price a UK customer sees, and the payout you receive, as two different figures.
• If you sell on your own site and you are VAT registered, decide whether the advertised price includes VAT and say so before payment.
• Don’t compare your price to a foreign competitor’s screenshot without asking whether their number includes tax.

Tax is not a rounding error you apply after you have picked a “nice” number. It is part of the number.

Trials, family sharing and ‘too cheap to trust’

A trial, a tip jar, or a very low price can all be honest, and they can all backfire.

• A trial should show the real product, with a clear end, as discussed in the model guide. It is not a reason to set the eventual price three times higher than you can justify, on the theory that people will forget to cancel.
• Family Sharing, if you enable it for a paid app or for an eligible purchase, is part of the value. Mention it. Don’t set a price that only works if you quietly hope families will buy several copies, then be upset when they don’t have to.
• Too cheap to trust is real for some tools, especially professional ones. If your costs and the job both support a higher figure, you are not doing anyone a favour by charging a novelty price that forces you to abandon the product later. A modest, explainable number that lets you stay is better.

Reviews should not be bought with an introductory price you immediately regret. A short launch price can be fair if you tell people what it is, and what it will become, and you honour the deal for the people who bought it.

Changing the price later

You will learn. Sales will be slower or faster than you thought; costs will move; the product will get better. Changing the price is allowed.

A few rules of decency and of practicality:

• Raising the price is easier to defend when the product has clearly grown, or when you said at launch that the introductory price would end. Existing customers on a one-off paid app usually keep what they bought; don’t also take features away. Existing subscribers should be handled according to the current store rules, and with a warning you would like to receive yourself.
• Lowering the price can be a sale, a permanent correction, or a signal that the product is in trouble. If it is a sale, date it. If it is a correction, don’t pretend it is a carnival.
• Don’t yo-yo. A price that changes every fortnight trains people to wait, and it makes reviews and screenshots go stale.
• Change the product page in the same breath: the first screenshot, the subtitle, the What’s New note if the change is part of a release. A new price on an old, thin page will not tell you much.

Give a change enough time to mean something before you judge it. A weekend of a quiet store is not a result.

A short worksheet

You can fill this in, in a notes file, before you set the store price:

• The job the product does, in one sentence, and the likely alternative if it did not exist.
• The ongoing yearly costs you have to cover, including commission and any servers, based on current terms, not a memorised percentage.
• A conservative number of sales or renewals you would still accept, and the floor that implies.
• The model: paid up front, one-off unlock, or subscription, with a reason (see the model guide).
• A candidate price point you can say out loud, in the currency you think in.
• What that candidate becomes in the other storefronts you care about, as the store actually displays it.
• What a UK customer pays, what you receive, and whether VAT or similar tax is already in those figures — confirmed, not guessed.
• Whether Family Sharing, a trial, or a launch period is part of the deal, and how you will describe it.
• The sentence you will use if someone asks “why does it cost that?”
• The conditions under which you would raise or lower it, and how you would tell people.

If a line is blank, fill it before you ship. If two lines contradict each other, fix the contradiction, not the typography of the price.

Key takeaways

• Pick a price from the job the product does and the costs you must cover, and treat it as a hypothesis you can change.
• Use a familiar price point you can say out loud, then check what each storefront actually displays.
• VAT and store commission change both the number people see and the amount you receive; confirm the current rules, don’t guess.
• A trial or a very low price should still be a deal you can live with, not a trick or a route to abandoning the product.
• When you change the price, tell the truth, look after people who already bought, and give the new figure time to mean something.

If you want a second pair of eyes on a pricing page, tell me about it.

Frequently asked questions

Written by Lee Johnson. Published 10 November 2026.