Stop Using the Cup of Coffee vs. $0.99 App Analogy
joshlehman.com
joshlehman.com
Please, please just start charging for apps again. I specifically search for "pay once and never again" apps now.
Power law strikes again.
To be honest - as an independent app store developer, these are REALLY hard to maintain just because you need to balance the need for ongoing development w/ servicing existing customers. Most app price points don't allow for this, since many customers are outraged that you would have the gall to even charge for an app (everything should be free, right?).
We've done well at doing both - and trying to add ONLY subscription services for features that are useful to users who use the app month over month.
On the other hand I really don’t want to pay USD10 a month for access to premium features that run on my phone.
Oh. And yes. I prefer as much as realistically possible to run on my phone.
And I'm fairly sure I have sometimes paid for apps I really like even if I'm not sure I'll use them - just to reward the developer and incentivice them to develop more good apps.
I do this too. Subscriptions usually flip the bozo bit for me.
Do you even want those kinds of customers in the first place? I've found that paid apps tend to have higher quality customers instead of the bottom of the barrel type of customer that flocks to Clash of Clans.
http://www.androidauthority.com/how-to-get-refund-apps-googl...
Also, compare with Kindle, where you can download a sample of any book you like, and it just sits until you get around to reading it. Once you finish the sample, you can decide whether to buy it. I think that model is closer to free with in-app purchases than anything else.
[1] https://support.google.com/googleplay/answer/2479637?hl=en
If a free app starts out with limited functionality for trialing, with a (one-time) in-app-purchase to unlock the full features, is that a good thing or a bad thing?
Follow-up: if it's a good thing, how should the app developer make it clear that it's not crapware? (asking for a friend)
But it goes the other way too. I bought Bad Piggies some years ago. I play it on vacations. And this vacation I started it and just couldn't figure out how to start a level. There were several buttons but they all seemed to start fullscreen unskippable ads for other games instead of the game. I tried several times and gave up. I'm not sure there still is a game in there.
I think behavior like this should not be allowed by Apple.
The closest thing I can think of is what Apple did to Final Cut Pro users, or what Sony did to Other OS users on the PS3.
That's a tough one, especially for small developers.
I wish there was distinct language for this. But at least I've learned to look closer, before making up my mind.
P.S. I just checked a couple of apps I was thinking of, and I do not see -- or no longer see -- that language on their app page. One -- Open Camera -- does have the ability to make such a donation by purchasing a separate "donation app".
I don't know whether the language has changed, or whether I'm mis-remembering my past experience. About the time Android and smart phones came along, I lost the will to keep my attention focused on and keep up with every last detail.
Anyway, I've no problem with making a donation for an app I value. I tend to favor such apps, because I just don't have a lot of trust in closed-source apps. Not that all app developers are bad or evil, but 1) Mistakes get made, particularly around security; 2) Apps get sold, and the new parties are an unknown, then already on my device; 3) Ads -- sooner or later, in distraction and/or malicious behavior, they go bad.
I also pay for some commercial, closed-source apps. But I have to have a fair amount of trust in the outfit behind them.
Anyway... Play platform language is oriented around "sales" and not "contributions".
Android has the concept of 'unlock keys', which were basically IAPs for full unlocks. I'm pretty sure you can still make them, as a couple apps I use still have legacy keys in addition to IAPs (added later).
The guarantee that you're only paying once is a nice thing, but these days I think users understand IAPs these days and prefer what they know.
oh, and there are those app that started paid for and switched to free+ads, leaving users who bought it prisoner of their sucky ads experience.
Though, Nintendo has been experimenting with IAP and F2P stuff, which I just try to avoid.
I just got to question how the developers felt that it was morally acceptable to create a toxic enough app experience that drives users to use in app purchases through deceptive tactics during the first few minutes of play to go and drop +$100 on virtual gems.
I'm sure the anchoring effect helps too, of course.
Do you have actual stats on how many people purchase this sort of thing, or are you just guessing?
I mostly agree, with the exception of a FEW good game publishers that have an ad supported version where ads can be disabled via a one time payment. Best of both worlds.
Another example I've seen is extended demos that have an unlock for the full game. Solitairica does this well, the free game by itself is a good three or so hours, and a one time payment gets another 20+ hours of gameplay, and more DLC is available after that. Unfortunately the app store doesn't have a way to search for "No repeat IAP for in game currency", which is what I really want to avoid.
The "in-app purchase" thing is good when someone designs their "app" like a fucking cigarette hit (or a cup of coffee). They have to make the user desire that hit every day. Games do that because they are addictive.
The numbers support a claim that in-app purchases make more money, but this should not be mistaken for proof that in-app purchases provide a better user experience.
People put down money for in-app purchases because they encourage addictive behaviors. I don't think it's a non-starter to ask people to give up money to behave with conscience. There are many areas where we ask and even mandate businesses to behave ethically.
And IAP != encouraging addictive behavior.
You're conflating mobile games that use IAP and very specific patterns with IAP.
IAP are also used for simple things like providing a "paid ad-free version" within a single app, or to unlock additional functionality. The trend of people having an aversion to paying up front applies to all mobile apps, not just games.
People vote for all sorts of awful things with their money. It's ridiculous to assume that means the people they bout for are behaving ethically.
The top grossing apps are all free no matter where you look, if charging for apps was profitable we'd expect to see at least some paid apps right?:
https://thinkgaming.com/app-sales-data/
https://play.google.com/store/apps/collection/topgrossing? hl=en
It's well known in app development that not having a free app will seriously hamper your traction. The only apps I've seen get away with it are technical utility apps, and remakes/releases of established games for non-mobile (GTA, FF, RCT, etc.)
You wouldn't pay $4 for a coffee at Starbucks, then come back to the store six months later and say "I paid $4 for this, refill it." But you expect that app you paid a buck for in 2008 to still work in 2017 across 10+ new OS revisions (and one or two major UI paradigm shifts), and the justification for that is "I paid for it once."
When you went out and bought boxed software it was kind of an expectation that it was going to work for a reasonable time period afterward. But if you want an update or support for a later OS version that didn't exist at the time of purchase, you're going to pay for it.
Many of us are in the software business. So we know how hard the stuff can be. But the customer doesn't, and shouldn't care. I think it's reasonable for the customer to expect updates forever. Particularly because so often, we put out a product that has bugs and problems in it. The customer is sometimes already being fairly accepting being willing to pay for a product that has problems that are yet to be fixed.
The app author also has the ability to release a new app if the features warrant. So no one is forcing the publisher to give new features for free.
That's easier said than done. You can't really do this without losing your customer base, links to your app in the store, sign-in tokens, etc, and you have to have some mechanism for migrating data out of one app sandbox to the other.
Additionally, if you want to be fair and offer an upgrade price, the app stores don't allow this directly.
Tweetbot did something clever; they wanted to charge $10 for new users but $5 for upgrades. They put the "old" version and the "new" version in a package deal bundle on the iOS App Store, and priced the bundle at $10. If you had the "old" version already, you got get a discounted upgrade by buying the bundle -- since you already owned one app in the bundle, you got a credit for that towards the full price.
The app stores could fix this problem and allow publishers to set upgrade pricing, but they don't.
So convincing the prior users that they should pay $10-40/mo was a challenge. For many that objected, I told them the truth - that the prior creators could no longer sustain it at that price and it was actually severely underpriced. I told them they are free to use the desktop version as long as they want but that we can't support it and we are doing a membership model which will be supported - for devices now and in the future and we'll be adding new features as we had been.
That helped to convert most.
I agree with you that the expectations aren't inline with what it takes because a lot of software is subsidized by ads and we had a long history of desktop apps working for many years. Many users will understand if you position your response properly, assuming you don't have a better, cheaper competitor! :)
Our audience is older and we still get contended on price because people will think of the value they get for what they pay for Netflix or Office. They usually understand when you say that specialty software cannot exist unless it's priced higher and that we aren't a megacorp like Microsoft.
i.e. "You bought Space Trader for Android 6. You've since upgraded to Android 8. Cough up another $.99 for the Android 8 version, or continue enjoying what you paid for on another device running Android 6."
It seems fair to me, but I could see this becoming a lot of clutter (rebuying v4-v5-v6-v7-v8 and having as many apps in your library).
Sooner or later end of service life (or just the "ooh shiny" factor) will force an upgrade on the user.
If it helps, then take that $0.99 and earn interest on it forever, that interest should be enough to pay for updates.
There are certainly many rational reasons for why someone wouldn't want to pay a buck for an app, but it's worth pointing out that a significant number of people are irrationally averse as well.
http://www.investopedia.com/university/behavioral_finance/be...
If we transfer the app store experience over to the real world who would pay $4 for a cup of coffee at your shop if there were coffee stands on the sidewalk literally every 100 meters offering excellent free coffee for you to grab with some ads printed on the cup.
That's about the sort of competition that mobile app developers have to put up with. Starbucks however didn't have that competition when they started out, that's why they could become so big in the first place.
And like you mentioned, coffee is actually pretty expensive. Even at $1, if you drink a cup a day that's $30/mo which is more than the cost of GitHub Enterprise. If it's $5 for a cup and you drink one per day, that's $150/mo which could get me an absolutely massive Digital Ocean droplet. We pay an assload for coffee. Bad comparison.
And not to mention coffee is addictive; many people drink it because they feel like they have to, not because they necessarily want to.
Comparing your app to coffee is just an awful comparison all around.
> Fact: Starbucks Coffee is a Trustable Experience
It's not that 99 cents is expensive. It's that if 1 hour of my time is worth $50, and a 99 cent app wastes 1 hour of time, I'm out $50.99. The low price tag is itself a disincentive because experience has taught me that it's very rare to find something indisputably worth $9.99 that has been valued (by its own creator!) for 99 cents.
And as a technical issue, if you were to pick up apps because they were free or cheap, you'd subject yourself to cognitive overload, even if you never even opened those apps and wasted time on them. Nothing is ever free, and even if Starbucks/Peet's is a bit overpriced, at least I know what I'm committed to (barring an unexpected discovery that coffee is much more harmful than previously thought).
The most solid apps I use just promote or expand another primary product. They're made as an adjunct by a company with a different revenue stream.
I don't know if it's walled gardens or the ease of payment that drives the shift. I'm glad people can get paid for good work, but I worry we lost something.
On the other hand, maybe it's just nostalgia taking. I wish I could find all the old astronomy simulators and games I found on BBSs, see if any of them actually hold up. Maybe software overall has gotten so much better I just raised my standards.
That's not the case with apps. I could easily spend a thousand bucks on them in a single day, so I am very careful with every single $.99.
I've bought Wolfram Alpha for about a buck, I've blown 30 bucks on a bachata moves app, but god forbid if anyone offered a run tracking app without a subscription.
- "People are building fantastic free apps. They are finding new and creative ways to make money off these apps" People drop $4 on coffee at new coffee places/restaurants all the time, so that whole I trust this experience thing is really not valid when you think about it a little further than your morning Starbucks.
- "Fact: Starbucks Has No Free Alternative" - This can be interpreted to say that maybe more apps should be $0.99, so that users get used to paying for the apps. I dont think anyone would question the $0.99 price for apps if thats how it was from the beginning. - "People are building fantastic free apps. They are finding new and creative ways to make money off these apps". This is because the prevalence of free apps has trained developers that people wont pay for apps. So new/creative ways of making money is most likely a result of there not being a way to make money by selling the app itself. Another way to look at it is, because you cant make money just selling the app, the only people who survive are people who can find other ways of making money. If the expectations was for apps to be paid, maybe more people would make apps and we would see a whole different world of apps.
I realize that its hard to change consumer habits, so free is likely to be the dominant distribution model. But its important to distinguish that the current reality might not be the best alternative.
While you might argue that I'm discounting the cost of the water and electricity, I'd argue that instead we're talking about the same issue as the cost of the phone. I have a $20 phone which works well for me. But any purchase in the Play Store is getting judged against that $20 value; if the phone were worth more there'd be no hope of an app significantly increasing the value of the phone.
There's no app I really need that's not free (or OEM like phone, text, memo, camera, ebook reader). The few that I do want or which I might need? I can get that function working in a browser.
The cost of goods on your $1 app is close to, and perceived to be, zero.
Cost of goods refers to the production cost of an individual item. COG for app store is zero. You don't even pay for hosting your app on the app store.
Software developers are R&D, not cost of goods.
There is R&D associated with Starbucks coffee as well (researching beans, refining the blends, etc), but nobody really factors that into its perceived value.
- If you include equipment, rent, and utilities in your cost calculations, then you have to include software developers and servers that are powering the app. I am not talking about apps that you build, publish and forget. Most apps have backend and engineers maintaining and supporting them.
- You ignored my point about the customer acquisition cost which is likely to be the biggest cost for most apps.
The duplication of an app for each install is technically very low cost (although you could say that the app store taking 30% is a cost there), that doesn't mean there weren't large up front costs and ongoing ones as well.
What about maintenance, support, infrastructure like servers/services/bandwidth. For anything of a decent size you probably have to do these things, which means you probably need staff, which means you probably need an office, benefits, insurance, all the usual business costs. That's not even bringing up the constant updates, new features, and supporting the ever changing platform or environment it runs on, which is all completely expected by users.
Apps are as much of a regular business as anything else, not some magic special case.
Sure there is. Just do what Starbucks does:
• Build an app experience that’s unique and doesn’t feel “easily replicated”
• Provide something the user sees as valuable to their daily life
• Package it such that it shows off its craftsmanship Find creative ways to profit off of a “free” version (Starbucks doesn’t do this…. yet)
• Quit complaining about money wasted on cups of coffee
Don't forget the part about spending millions on advertising, so that people know what your product is.
That said, they still often lose out in that comparison.
Not like coffee.
Plus even if the facts the author wrote were not true, it's just overused at this point anyway.
Haven't the ability to return apps been around for like, 6-7 years?
EDIT: I see downthread that this has apparently changed
I stopped reading after that...
actually i can't think of thing i would buy daily which would be waste of money and not essential
if the app is useful like launcher or calendar reminders i am willing to pay, but i have trouble to imagine more paid apps i would be willing to pay with great free alternatives
1) it's a tired metaphor with weird resonances to a male dominated guild structure.
2) even the positive aspects don't really apply to Starbucks which is more fits the "well oiled machine" analogy. If i think of craft coffee, I think of a small (possibly independent) coffee shop where the baristas really know what they are doing
3) I think that customers do care about Quality, but they dont' (en masse) care about craft, your journey is not of typically of interest to them, just your results.
The article relies too much on a notion of craft which describes how a product is made, I believe that the consumer cares about the quality which is the result of that journey, only a fraction of customers care about the process.