In-app purchases not so hot for some developers
Posted Sep 21st 2009 1:00PM by Mike Schramm
PocketGamer.biz has an interesting interview up with Pangea, makers of the iPhone physics puzzle game Enigmo, and they say that so far, their experience with in-app purchases has been pretty lukewarm. The software itself has sold over a million copies, but only a very small number of those customers are going for the in-app purchases -- about 25 per day, according to Pangea's Brian Greenstone. 25 per day may not be bad for a smaller developer, but Greenstone says he "was expecting hundreds."Why aren't the microtransactions doing so hot? It's going to take time, first of all -- customers need to learn the value of picking up content piece by piece, and developers need to learn exactly how to price and plan the stuff out. On an established download service like Xbox Live, add-ons and content packs have become de rigueur, though some of those battles are still being fought. But on the App Store, not only are prices still up in the air, but in-app purchases are hard to find, and they're all over the map in terms of value versus investment.
Greenstone seems to believe what I'd tend to agree with: that after all of the dust has settled, customers will pay for content that's worth paying for -- he's just given up on worrying about pricing, and is focused on delivering content that's worth whatever he wants to charge. Eventually, both devs and customers will settle on a fair price, and when that happens, I'm sure we'll see some major in-app purchase sales.
Reader Comments (Page 1 of 2)
Jason said 1:11PM on 9-21-2009
I would have purchased the in-app downloads in Pangea 1 if they didn't say childrens. Pangea 1 was one of my favorite original iPhone games. I was waiting for them to release more levels or a part 2. When I saw the in-app downloads I got excited. But it said it was for children and thought they would be too easy.
I hope your reading this Pangea. It would be interesting to see how many others felt the same.
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Jason said 1:13PM on 9-21-2009
Sorry to double post. It would also be interesting to hear from The Icon Factory and their in-app purchases for Ramp Champ. I think the content was worth purchasing.
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Tony Bowman said 1:15PM on 9-21-2009
"customers need to learn the value of picking up content piece by piece" sounds an AWFUL LOT like "customers need to learn the value of being nickle-and-dimed."
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thezonie said 1:28PM on 9-21-2009
Well you can also look at it like this: As a developer, you can either price a game at $10 and not sell any because people recoil in horror if something on the App Store isn't $0.99, or you can price it at $0.99 and offer additional features / options / functionality / content as a-la carte in-app purchase add-ons.
Tony Bowman said 1:45PM on 9-21-2009
that's still charging the customer $10 for the app, where it be all at once for a fully-featured app or skeleton app and then a feature at a time. it's the same thing.
personally, i would rather pay the high price up front and know exactly what i'm getting up front and getting all of it right then and there than pay for a shell and hope the developer sticks it out with the app and fills it out to be fully-featured/content rich instead of abandoning it for other projects if the initial sales of the shell and in-app purchased don't pan out.
kmcgrady90 said 2:28PM on 9-21-2009
@Tony Yes it would be preferable for developers to charge the full price initially with all content included but consumers aren't willing to pay for content on the app store. Even large game companies like EA have to charge very low prices for their titles to be in with a chance at generating many sales.
thezonie said 2:39PM on 9-21-2009
I see what you're saying, but the "fear of developer abandonment" only pertains to future updates that have yet to be released.
In the case where you paid for the full $10 game up front and the developer walks away then you're in worse shape than if you had paid for the $0.99 shell with the plan of paying for the future updates.
Tony Bowman said 3:01PM on 9-21-2009
not at all, @thezonie. i don't pay $10 for a gimped app. it either has what i'm looking for (be it features or content) already, or i don't buy it. i don't lose out in that scenario at all, because my purchase doesn't depend on future updates at all everything is there from the beginning.
the only value a product has is that which the market is willing to give for it. so, either devs are overvaluing their products or the market is undervaluing the products. which is it? probably somewhere in between.
but for ME, the product has to be compelling all on it's own at the time of purchase to warrant that purchase*. there's no incentive for ME to buy something that may or may not deliver at an additional cost later, then i can dedicate that money to a purchase that does deliver(under my own standards) at time of purchase, especially in a marketplace that offers as many options the App Store does for just about everything.
* i'm not saying i don't buy apps that have serialized features and/or content. i'm just saying that i won't buy one and its updates until the app as a whole reaches a price/feature/content threshold that meets my personal standards for those criteria. in this way, a shell app plus feature/content updates is functionally the same as a high-priced(relative term, of course) app that is feature/content rich at time of purchase.
Galley said 1:28PM on 9-21-2009
Regarding Ramp Champ, their in-app purchases not only work very well, but they are a good value. 99 cents gets you two more ramps, with additional goals, prizes and trophies.
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Aaron said 1:43PM on 9-21-2009
I agree with the value vs. investment statement. I think apps like Panelfly, an app that allows users to purchase comics directly on their phone makes a lot of sense. It's definitely a good value for investment. You can by Panelfly for .99 and then buy as many comics as you like ranging in price anywhere from .99 to 9.99.
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Larry said 1:43PM on 9-21-2009
If you look at Free to Play MMOs, depending on who you ask, something like between 10% and 1% of a game's player base buys anything for the game. The majority of people are fine just playing the stock free experience.
I assume the same holds true with iPhone games. Most people are fine with the 99cent experience they bought. A few will want to extend their experience with DLC.
More than anything it sounds like another case of iPhone developers needing to recalibrate their expectations. I.E. developing on the iPhone does not equal You Won the Lottery.
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Daniel Longworth said 1:47PM on 9-21-2009
It might also have something to do with the way people use these app games. I for one have bought many games, but rarely do I ever actually play them. They are cheap enough that I buy them to have for when I get a chance to play but I have so many I don't really need anything extra for any one of them.
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DigMo! said 2:08PM on 9-21-2009
I have the same issue with an app I purchased. The in app purchase doesn't work with the UK store :( which means I would have to buy the application from the main store and would thus end up with two versions of the application instead of two translations in the one app :(
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Posimotion said 2:57PM on 9-21-2009
We are thinking of going to this model in the early future and am psyched to see this demographic being reported on Tuaw. The distant people have with what they are buying for an upgrade is the hard part. Moreover, this is one of the first large scale programs like this. Many people have yet to experience micro transactions...at least in the US.
Only time will tell
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Weasler said 3:36PM on 9-21-2009
Now I'll admit that it's been a while since I last checked Enigmo's download levels, but the last time I had all of the extra level packs were for "Children", which really me and many others like myself.
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Matt said 3:52PM on 9-21-2009
Myself and everyone I know will never be a part of micro-transactions. It's such a load of crap. I already bought the game and you want to charge me a little bit here and there for more? No thanks. Those of us with an Xbox360 or PS3 don't take part in the DLC on those consoles either. Why? Those map packs and such are free on the PC versions of the games. Why should I pay $10 for 3 maps when the PC version gets more maps for free?
Now iPhone developers expect me to pay even more for a game or app that probably wasn't worth the money to begin with? I don't think so. Most stuff on the App Store is nowhere near worth the $10 launch prices, and usually still not worth it when it hits the $5 mark. Theres no way I'm going to pay $.99 for more stuff to add on for an app that should have been cheaper to begin with.
Heres how I look at it. I already bought the app once. EVERYTHING should have been included with it from the start. If you want to add on to it, then do it for free. Thats the way its been for over a decade now with PC gaming and thats the way it will stay. If you want to charge for extra content it will fail and it will piss off the majority of customers, just the way Xbox and PS gamers are pissed now that they have to pay for content others get for free.
If you want to charge $5 or $10 for an app, MAKE IT GOOD. I can't tell you how sick I am of seeing a thousand different Sudoku or Mahjong games, or tilt to control racing games. To be perfectly honest, the App Store is mostly junk, save for a small handful of good apps. If you expect people to buy your app and then pay more after the fact, you're delusional. Flooding the App Store with junk and then expecting people to pay more for that junk after they've already paid for it will be what brings the whole thing down crashing and burning.
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RestaurantShareApp said 4:04PM on 9-22-2009
I also don't plan to use in-app purchases in my apps in the nearest future. The idea of buying an app for 0.99 and then finding out that all the nice features cost 5x more is scary enough for most of the people.
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Tom Smale said 6:48PM on 9-21-2009
Greenstone is a complete idiot. Or a complete Kool-aid drinker. Or both.
If you talk to gamers, listen to their podcasts, read the forum threads, the gaming community is almost 100% united against in-game fees. EVERYONE thinks its an awful idea. Same thing with in-game advertising. These companies pay for market research which skewers "test" data to give them the results they want and inside their bubble, they actually believe consumers are screaming for this stuff. They're deluded in the same way a spammer will tell you his messages are "making the consumer aware of quality products he wants."
And by the way, all this FUD about developers abandoning the iPhone unless they can push through their price gouging models from the PC, PS3, Xbox, DS, PSP, and Wii? Good. See you later. Goodbye. The "amateur" developers seem to be doing just fine, putting out quality games, supporting them, all at an excellent price. Don't let the door hit your ass on the way out, Pangea.
Nobody, nobody, I mean... NOBODY, wants to play a game where you have to spend $0.99 for guns, ammo, health packs, and other items. I hope consumers continue to ignore these crap ideas in droves until the game companies acknowledge the message.
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Mike.Lev said 9:39PM on 9-21-2009
What's the name of the travel guide app pictured in this posting? I'm looking for a good Chicago travel guide.
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JJN said 12:03AM on 9-22-2009
I think the in-app purchasing isn't working because app purchases are already the micro transactions. People buy and try out most apps because they're cheap. Buying an app is like buying an XBoxLiveArcade game or some maps for a full game, though apps on the iPhone are standalone and can be well done, they're still little games and applications.
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