What we say
We have received a lot of interesting feedback from our post regarding the poor overall sales in the Android market to date. Here is a follow-up on some of the comments:
It is encouraging to see some early screenshots of what appears to be a significant Android Market Overhaul. Most notably, there is a “Top Paid” category selectable on the main page (and presumably the default). It is possible to get to the paid-only apps in the Market now, but it requires some tricky navigation through a submenu. We suspect that very few users have found it. The default view is of all apps, but of course the unpaid apps dominate the list almost entirely. If users are unable to find the paid apps, they may arrive at the conclusion that all the apps in the Market are of relatively low quality.
However, it is demoralizing to see in this update that the currency is still tied to the developer’s location rather than the customer’s. There have been arguments that this is somehow a legal requirement, but Apple has gotten around this for iTunes, so it must be possible. Something has to be done– users should not have to do their own currency conversion when buying inexpensive “impulse-buy” apps!
Finally, it remains to be seen if screenshots are supported in this update. We sure hope so!
Credit Card Billing
There was some argument over the differences between billing in iTunes vs. the Market. Both accounts require a credit card, but iTunes is more flexible. There are gift cards and other ways to cap and control the spending of, say, a child’s account. The Android Market is less flexible– each purchase is a separate credit card charge– just like buying a sofa, as Matt mentioned. The credit card charge can even be denied without informing the user properly. It can also be disputed by the purchaser, resulting in expensive chargeback costs to the developer that are often even larger than the original purchase price of the app! While it is true that Apple started the App Store with a significant advantage over Google and others (with its enormous base of iTunes music subscribers), it still seems reasonable for Google to improve the Market purchasing experience.
Refunds and Piracy
The Android Market has an extraordinarily lax refund policy. Apps can be returned for a full refund within 24-48 hours. The official limit is 24 hours, but it seems possible to refund an app within up to two days in some cases. This would make sense for expensive, involved productivity apps; if the user is unsatisfied with the product, paid good money for it but won’t be using it, then a refund is warranted. However, for many fun apps and simple games, the user isn’t expected to get more than a day or so of use out of it. Note that these simple/fun apps are still a completely valid thing for which to charge money! They still require effort to develop and fill an important niche for users. For example, if my plane is delayed and I get a solid two hours of enjoyment from a $3 jumpy game, I shouldn’t be able to refund it 24 hours later. Compare to a movie; it costs $10 at least for a measly 2 hours of entertainment, no refunds! The result of this policy is that an entire category of apps and games (many that do very well in the iTunes App Store) are not valid on Android from a business perspective. Many developers report a >50% return rate, while still maintaining high ratings in the Market, suggesting that users are just getting their fun out of the apps without paying for them. Our return rate is fairly modest at ~16%, but we have purposely avoided apps that may be susceptible to higher return rates.
Piracy is another problem. The iPhone has its own piracy scene with jail-broken phones, but extraordinary effort and maintenance is required, relegating jail-broken users to a minority. On Android, the user must simply flip a switch in the settings to enable the installation of apps from other sources, then download apps from torrents, etc. It is unclear how many sales are lost due to piracy, but this could be a contributing factor to the low Market sales.
Thanks again for all the comments and feedback!