On Fremium Apps:
And that’s exactly what we’ve seen in the App Store. People have no problem paying 99¢ for a gimmick, and don’t mind risking 99¢ on an app whose value is unproven, but trying to make the boxed software model work at 99¢ a pop is a fool’s errand. Sure, gimmicks and mass market apps like Camera+ seem to prove the opposite, but they are the outliers. The vast majority of apps are financial flops even though they deliver tremendous value to their niche.
(Via Shawn Blanc)
I agree with 99% of David’s article, but there’s just one sticking point for me.
While I think subscription and in-app purchase are absolutely the only way to sustainability in the future for most apps, I see no reason why that means apps have to go freemium. Why can’t we charge a fair price for our apps up front, and then charge again for additional in-app features or subscriptions to services? Why are we so averse to being good salesmen?
Right now, productivity and other non-game apps are the last part of the App Store where users expect to pay more than nothing. Why condition users to expect free there if you don’t have to?
To me, the barrier for users is not a matter of money, but one of trust. People have shown time and again that they will pay for value on the App Store. Final Draft Writer is proving this week that a $30 app can rise as high as the third grossing iPad app in just a few hours. Why are they getting away with charging so much? Because they’re the most trusted brand in Hollywood. They are the defacto standard for the kind of app they make.
How do you get to that level of trust with users? Well, dropping your price to free to let more people try out the app without risk is one way to go about that, I guess. But for me, the better way would be to build a reputation for being worth your asking price. That takes a whole lot of time, patience, and pleasing your user base. Your sales grow at a much slower pace, and it takes a long while before you are making decent return on your app. But in the end, you get to be known as a luxury brand, rather than the bargain basement company. I think long term, that’s where I’d rather be.
I’m not sure giving away an app for free and then figuring out how to get money for it later is a good way to build people’s trust. Look at Twitter as a shining example of what happens when you aren’t up front about the value proposition with your users.