What we say

Android Market Sales Follow-Up

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:

Market Overhaul

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!

  1. 1
    Michael Maitlen on 09/01/09 at 20:11:11

    I totally agree with you on paying for small apps and games. As a developer, I put quite a bit of work into even small one or two feature apps. It’d be nice to get paid for that effort if I share something that someone finds even marginally useful or enjoyable.

  2. 2
    David Shellabarger on 09/02/09 at 03:10:06

    I totally agree with you on the first 2 points. Hopefully the new app store will at least have screen shots and it would be great if you could charge apps through your cell phone bill (make it super easy to buy apps).
    However, I totally disagree with you about the last point. A return policy is a must for lots of people to even try out your app and allowing other app stores to compete with the official one of the openness principles that makes Android better than the iPhone.

  3. 3
    Mark on 09/02/09 at 11:47:58

    After reading your post I tried hard to find the option in the market to show only paid apps. Initially I was convinced I must have a different OS build that didn’t have it. Eventually found it on the third attempt, after 15 mins. I am a developer and breathe Android, and I never knew this existed.

  4. Matt Hall on 09/02/09 at 12:43:19

    @Mark That’s exactly what we’re talking about, it’s heartbreaking. From the screenshots I’ve seen of the new market they’re going to switch to an app store top tabs layout which will probably help a lot. Who knows when that will be released though.

  5. 4
    gc on 09/02/09 at 13:59:39

    Something to consider, the number of downloads isn’t necessarily the best metric to determine popularity. For that matter, popularity isn’t necessarily the best metric to determine an applications ranking. Which is more popular in this example? An application with 1000 downloads and 50% retention or an application with 500 downloads and 100% retention? I’d consider them of equal popularity with the distinction that the first is simply more enticing – for whatever reason. Now consider, what if the first is rated four stars and the second is rated five? In my opinion, the second should be rated more popular.

    And for pay apps, popularity should include a simple multiplier of downloads and cost. If an application costs $5.00 and is downloaded one time (scored 5), it should be considered as popular as an application downloaded five times but which costs a dollar (scored 5). From there its voted rating should further weight its ranking.

    Of course I doubt Google will consider such a scheme which allows applications to better compete but wishing never hurts.

    Lastly, IMO, only pay apps should rise to the top of the “Just In” list. Far, far, far too many useless or generally low quality yet free applications completely drown out commercial offerings. Google should provide this mechanism to effectively promote commercial developers who update their applications. And while I understand the possible negative implications, reasonable limits can be assigned. Even if caps/limits were not implemented, it would still be a significant improvement over what Google currently provides.

  6. 5
    brad b on 09/02/09 at 20:31:24

    Regarding the return policy:

    I am a developer and I agree the return policy is way to lax! Look, if we didn’t have this return policy, dev’s could just make FREE trail versions for people to try first. If they liked that, they download the paid one. Simple as that!

    Right now they can download the paid one, try it, and return it.

    This is why I dont have a trial version of my app out, because of two reasons: Firstly, you can already try it and if you dont like it just refund it, and secondly, if you look thru the market, almost every time you will see that trial apps vs. the paid app, have a much worse user rating. It’s because it’s being judged by limited features, etc. Usually the paid version of an app actually gets higher ratings!

    So I see no need to soil the ratings of my program since people can download it and try it for now anyway.

    However, if they went to “no refunds”, I could make a trial app that people could try, and have limited features, and probably get much better sale retention. IMO.

    I think right now I’m around 67% or so retention.

    Also, to jump in the info throng, I get average around $20-24 a day, some days after I release an update it will jump to $50 or so a day for a couple of days. But currently average about $15-$25 / day always lately.

    -niko twenty

  7. 6
    and on 09/03/09 at 10:48:12

    Just wondering how many IPhones and Android phones are out there..Has someone got figures for that?

  8. 8
    Demio on 09/03/09 at 19:19:40

    I wish I could pay for applications in the Android Market.

    Google hasn’t allowed Canadians ( and many, many other countries) access to paid applications yet – Which is extremely sad in my opinion.

    If there is no way to purchase these premium paid applications, people will just resort to pirated versions of these apps because that is they only way to obtain them.

  9. 9
    Ben on 09/08/09 at 21:22:49

    Very neat discussion going on, concerning the Android market place.

    I would like to chime in with a few notes. I work with FADE LLC – a new analytics company that specializes in video gaming digital markets – XBLA, WiiWare, iPhone and Android.

    I don’t believe the Android market is as robust as the $5m/mo cited by some sources like AdMob. In July, games we tracked accounted for just ~$170,000 in revenue – a far cry from $5 million!

    There are a lot of issues with the Android market right now, many of which have been stated. Functionality of the market is not very user-friendly at this point in time.

    Support for paid apps, by country is also anemic. Only 8 countries are able to purchase paid apps. Not a very convincing number.

    Another issue is that of the networks behind the Android and iPhone(s). The iPhone uses AT&T in the US, which some may argue about, but they do provide a better network than T-Mobile, which powers US Android devices. T-Mo has pretty bad 3G coverage, which may be detrimental to the purchaser’s experience. I know for myself, the Android market crashes constantly. and does not update very quickly using EDGE.

    However, the potential for Android is still there. When it comes down to it, the core advantage for Android is that it will have a larger market share when it comes to handset penetration – once major players come on board, we should see handset penetration jump.

    Also concerning sales numbers of handsets: Android has between 2 and 3 million handsets available, while the iPhone has roughly 45 million devices between the iPhone and iPod Touch.

  10. 10
    Enderx on 09/22/09 at 01:27:51

    As an android hacker, and someone running a ROM from xda, cyanogen’s 4.1.11.1, I would say that torrenting and pirating is probably pretty uncommon for android.

  11. 11
    Steve on 10/27/09 at 22:24:06

    I purchase many, many appliacations. I like to support programmers, paid applications are generally better, and paid applications are likely to be upgraded.

    If it were not for the 24 refund I would probably be more reluctant. I think I may have returned 2 or 3 programs, but I like the idea of being able to try it first.

  12. 12
    Gaurav on 03/24/10 at 14:19:42

    One big issue that Google needs to resolve is allowing developers from many countries to sell applications. Right now, these developers either don’t develop for Android or simply put up “test” applications. There is no real motivation for them to develop for Android. If resolved, these developers will create many locale specific apps which will improve the quality and variety of apps on the Market.

  13. 13
    Lewis P on 06/19/10 at 01:39:18

    To be honest as a consumer I think that paid apps should have 24hr return but you shouldn’t be allowed to get a full refund, maybe 50% developer keeps 50%. The way I see it is if theres a trial or demo version then you know if u like the full version developers deserve all the money for their great effort and support to the android market with out them iPhone apps wouldn’t be a success right?

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