Realmac Goes Deep Into Its 'Clear for Mac' Pricing Strategy

The response to this is going to be fairly predictable. Those who write apps will feel some sympathy with RealMac Software. Those who buy apps will say that it's too expensive. Probably.

Being a developer myself I fall into the former category. I'm going through a similar thought process for an iPad app I'm just wrapping up development on. It's taken many hours to create and I've spent a huge amount of time carefully putting it together. I had to bring in an expert for the subject matter I'm working on and she also invested lots of her time in the project. We will split any profit between us.

Similar to RealMac software selling my app for less than a fiver just won't do it justice, however I know that if I charge much more than £1.99 for it, it probably won't sell - however good it is.

When I first started developing apps for the iPhone, before the iPad was in the frame, I remember telling a friend about a project I'd been working on with some colleagues. I'd written the code, one other guy had created the graphics and the other had developed the concept and tested. We'd decided to charge just 99p for it, even though - with 3 of us involved - it would take forever to earn anything close to the money needed to pay for our time. This is before iAd or the move into freemium app models but he couldn't understand why we weren't giving it away for free. And this guy runs his own business. :eek: Scary.

The bottom line here is that people want a bargain and don't want to pay a reasonable rate for other people's hard work. They shop in cheap supermarkets and don't understand why their food tastes horrible and buy cheap clothes that in 2 washes are falling to pieces.

I will be flamed to within an inch of my life here, I realise that, but however much I don't like it - that's the way it is. :(

The response to this is going to be fairly predictable. Those who write apps will feel some sympathy with RealMac Software. Those who buy apps will say that it's too expensive. Probably.

Being a developer myself I fall into the former category. I'm going through a similar thought process for an iPad app I'm just wrapping up development on. It's taken many hours to create and I've spent a huge amount of time carefully putting it together. I had to bring in an expert for the subject matter I'm working on and she also invested lots of her time in the project. We will split any profit between us.

Similar to RealMac software selling my app for less than a fiver just won't do it justice, however I know that if I charge much more than £1.99 for it, it probably won't sell - however good it is.

When I first started developing apps for the iPhone, before the iPad was in the frame, I remember telling a friend about a project I'd been working on with some colleagues. I'd written the code, one other guy had created the graphics and the other had developed the concept and tested. We'd decided to charge just 99p for it, even though - with 3 of us involved - it would take forever to earn anything close to the money needed to pay for our time. This is before iAd or the move into freemium app models but he couldn't understand why we weren't giving it away for free. And this guy runs his own business. :eek: Scary.

The bottom line here is that people want a bargain and don't want to pay a reasonable rate for other people's hard work. They shop in cheap supermarkets and don't understand why their food tastes horrible and buy cheap clothes that in 2 washes are falling to pieces.

I will be flamed to within an inch of my life here, I realise that, but however much I don't like it - that's the way it is. :(

AJ, you raise some good points.

I'm not a developer, but I do run my own little business and people focus way too much on PRICE these days. I'm not sure if it's just a down economic time or the fast paced technological world we know live in where people simply don't have patience or a combination of both.

But regardless, people focus too much on price without worrying/caring about the time gone into a product or how much they'll use it.

They've also forgotten about another key element - VALUE! If there's no value to you, then don't buy it. If there's value and you think it's worth it to you, then buy whatever it is you're hedging on.

There are a number of apps I use all the time and VALUE more than others. If an app out there would do what I want, then I'm all in. The price would be justified to me. Might be worth it to others, might not.

Also, there's something to be said for this company keeping their price as is so they can somewhat control their user group. ie. if they care about their product and want to improve it, I would then think the feedback coming from a user who valued the product at $15 would be someone who actually uses it often and has a vested interest in its future.

Versus joe blow who paid $0.99 for it, hardly uses it and b*tches about it to the company on feedback forms, emails or calls.

I'm like that with my business. My prices are based on my costs, time and the value I provide. If someone comes to me and says, well, joe blow does it for x amount less than you, then I say go to them then. Do i lose some business? For sure.

But I also lose most of the headache clients who don't see nor understand the value. In the past, I did bow down to price pressure, but since I stopped doing that, I'm alot less stressed trying to gain business by working for those who want the work done.

As I told a client just 2 days ago (whom I've done work for in the past), I'd rather go to a movie or have a nap than work for minimum wage on a project that is worth more - especially when he didn't see the value. lol

Cheers,
keebler

I used the same strategy in college on whether or not to eat that week

Hah. Just keeping fishing for logic there. $15 for this app is too much. People would rather have an app that works nearly as well for $2 or $5.

A few years ago, $15 for an Mac app of this caliber would have been considered a bargain. It's interesting how "app store economics" have changed people's expectations.

Hah. Just keeping fishing for logic there. $15 for this app is too much. People would rather have an app that works nearly as well for $2 or $5.

Developers can cry all they want, but they should learn a little bit of business:

Peter Drucker called it a deadly business sin:

"The third deadly sin is cost-driven pricing. The only thing that works is price-driven costing. Most American and practically all European companies arrive at their prices by adding up costs and then putting a profit margin on top. And then, as soon as they have introduced the product, they have to start cutting the price, have to redesign the product at enormous expense, have to take losses -- and, often, have to drop a perfectly good product because it is priced incorrectly. Their argument? "We have to recover our costs and make a profit."

This is true but irrelevant: Customers do not see it as their job to ensure manufacturers a profit. The only sound way to price is to start out with what the market is willing to pay -- and thus, it must be assumed, what the competition will charge and design to that price specification."

When you talk about the labor you put into an app, that is all very nice, but the consumer doesn't care... All that matters is what people are willing to pay. So maybe when you think about developing an app - decide on the price it will sell at and then focus on putting the effort into it that gets you there and no more.