Revenue Concentration

Revenue concentration measures how unevenly revenue is distributed across apps within a category. In highly concentrated categories, a handful of top apps capture the vast majority of total earnings. In more distributed categories, revenue spreads across a larger number of competitors, giving smaller apps a better chance of generating meaningful income.

Understanding Concentration Levels

Most app store categories exhibit high revenue concentration. The top 5 apps commonly capture 70% or more of a category’s total earnings. Winner-take-most dynamics drive this pattern: top-ranked apps receive disproportionate visibility, leading to more downloads, more reviews, and higher rankings in a reinforcing cycle. Categories with subscription-based monetization often show even steeper concentration because users rarely pay for multiple apps that serve the same purpose. Categories built around casual or impulse-driven usage tend to have lower concentration since users more willingly try multiple free or low-cost alternatives.

Implications for New Entrants

Before entering a category, assess its revenue concentration to understand your realistic earning potential. In highly concentrated categories, competing for revenue means challenging the top players head-on, which requires significant investment. A more practical approach is to find categories with moderate concentration where earnings spread more evenly, or to target a niche where dominant apps do not fully serve a specific audience. Understanding concentration also helps you choose the right monetization model - in top-heavy categories, ad-supported models may prove more viable than subscriptions since users already pay an incumbent.