

Amazon App Store: Rotten To The Core - markfenton
https://shiftyjelly.wordpress.com/2011/08/02/amazon-app-store-rotten-to-the-core/

======
rkalla
<edited to remove the unintended snarky tone and clean up some points>

What I got from this blog post is that they made an uninformed decision, and
ended up with an unexpected result that pissed them off from the perspective
of "lost sales".

The email from Amazon clarified there were no money to made and sure enough,
no money was made.

The added costs of the server is unfortunate and justifiably something to be
upset about (especially if you weren't accounting for it), but I have to point
out that the sales before the free-app-of-the-day listing[1] were slow: 2, 4,
14, 20 sales... then 101k copies given away in one day.

For an app selling 10-20 copies a day, how much would it have cost that
company, paying a PR firm, to get it infront of 101k new users (forget about
payment)... how many tweets would you have to get out or blog posts written to
make 101k people aware of your app?

Amazon gave that company an incredibly aggressive marketing campaign for 1 day
and from where I'm standing, gave that company an enormous opportunity to be
successful with a future app or future subscription services for their
existing app.

I think things like what Amazon are doing certainly don't fit in the old model
of software sales and if you are betting the company on that model, it is
going to be a painful trip for you.

Something to consider is that if this app offered a subscription-based premium
mode or some in-app micro transactions and just 5% of people that downloaded
the app engaged in that, I think the tone of this entire blog post would have
been completely flipped about how awesome the Amazon model is. Even if that
app could simply be used to announce the release of a _new_ app in the app
store from the same company when the time comes that would be a huge amount of
people seeing that announcement that would not have otherwise seen it (not the
full 100k, but whoever is still using the app).

Given that, I would assert that the Amazon App Store model isn't broken, it is
just different and requires some planning to take advantage of.

If you have a flexible business model and can roll with the punches and take
advantage of opportunities like these and see them coming you stand to benefit
quite a bit from Amazon's free app of the day.

Let's say everything I've typed up until now is garbage and you waved it all
away, another reason this was a _good_ thing for the company: reviews.

Out of 101k people that now have this app, how many are going to eventually
leave reviews? 20? 30?

How many reviews may be a half to a full star higher because the app was free
and there isn't that feeling of _being owed value_ by the reviewer because
they got your app for free.

So now let's say in a few weeks (or at some point in the future) this company
now has 15, 20 or 30 reviews on this app, all fairly good (4 and above).

Now that the app is no longer free, how much higher in the search results is
this app going to show up for people when they are searching for apps like
this? How much more likely are people browsing the Amazon App Store to buy
this app because it has such good reviews?

I would argue had this guy listened to his co-founder and not flown off the
handle, and left his app in the app store, and built off of this success he
would have seen sales gradually increase over time, similar to how it was
trending before they had the one day give away. All those sales before the
give away were people finding the app because (I assume) they wanted an app
like that.

The one day give away was likely a bunch of people that just grab every free
app they see each day.

Either way, it sounds like he took the gift horse he was given by Amazon,
punched it in the horse-face and then let it run off a cliff because it wasn't
the exact horse they were expecting.

</end-backseat-internet-business-driving>

[1]
[http://shiftyjelly.files.wordpress.com/2011/08/results2.png?...](http://shiftyjelly.files.wordpress.com/2011/08/results2.png?w=497&h=175)

~~~
shiftyjelly
Can I just reply here? Here goes. I think you missed the entire point of the
article. We agreed to be featured, we stand by that decision. What we take
issue with is the public perception that Amazon pays their (publicly stated)
20% of the asking price for developers to be featured. They don't. Simple as
that. Everything else is a beef, yes, but not our primary beef. Also we left
it a month, we got featured June 27th, it's now August. Virtually no change in
sales on Amazon.

~~~
rkalla
shifty,

Admittedly, my response was focused more on the other beef than that single
point. Given how much other information was in the post, I didn't think the
20% == 0% _was_ the central argument; my apologies for missing that.

My core belief that in the long(er) term that the give away likely would have
helped the movement and sales of your app still stands though. I think you
leaving it in the store for an extra month _is_ valuable data point, but not
quite enough for me to categorically agree with "Yep, totally experiment
failure, f Amazon!"

Did any reviews come in from any of those massive downloads? How were the
reviews? What was the average score?

I would give up the argument completely at 6 months after a few more update
releases if there were 0 reviews and 0 sales, otherwise I stand by my original
statement that this was a GOOD thing for you and your company.

It is my feeling that you are focusing too much on this bait and switch. Fine,
it happened... but you also have your app on 101k more devices than you did
the month before so do something with that, flip your perspective a bit and
take advantage of it.

You cannot convince me that having your app on 101k more devices in 1 day is a
_bad_ thing (except maybe the server costs). It may be scary/odd/unexpected,
but you guys are smart, you will figure out some good way to grow from this.

~~~
kelnos
_Fine, it happened... but you also have your app on 101k more devices than you
did the month before so do something with that, flip your perspective a bit
and take advantage of it._

Hell, before pulling out of the Amazon app store, release a new ad-supported
version, and wait until a decent number of people have upgraded. _Then_ pull
out of Amazon's store. That should help defray the costs of the new hardware.
Users can still do as the author suggested: re-buy on Android Market, and for
users who had already paid for the app (not on free-app day), ask for a
refund. Any serious user of the app will want to switch over to the Android
Market anyway, so they can get later updates.

That feels _slightly_ underhanded, but... eh. Server costs are real.

~~~
neuroelectronic
Nobody would buy an app from a developer who did this.

~~~
kelnos
Yeah, in hindsight I realize that from the user's perspective, this really
sucks. As a user who knows and understands the developer's perspective and how
Amazon (intentionally or otherwise) screwed him over, I'd be sympathetic, but
the vast majority of purchasers would not know any of that background
information.

------
robtoo
_thanks to Amazon’s secret back-door deals, we made $0 on that day._

These secret back-door deals that were so secret that they were written in
bold in the email, so secret that they noticed this and wrote back to amazon,
and so secret that amazon then confirmed them.

They were offered a crappy deal, realized this and double-checked it, but
decided to go for it anyway. When it turned out that the deal really was
pretty crappy, they then act surprised and self-righteous and blog about it.

~~~
irons
He's not saying the 0% price was a secret from his company, he's saying it was
a secret to the general public.

I pay pretty close attention, and I thought the free apps of the day were paid
at the 20% rate that Amazon warns they may pay you if they unilaterally
discount your app.

~~~
tybris
I see no reason to think that's not the case. This was a mutual agreement
outside of the general terms. That's hardly unusual.

~~~
WalterSear
It is amazon's standard policy. Many developers have commented on it.

~~~
tybris
Their standard policy concerns the unilateral decisions. This was a mutual
agreement outside of the standard policy. The benefit to the app maker is a
guaranteed free-app-of-the-day promotional spot, the benefit to Amazon is not
having to pay the 20%. Seems like a (potentially) fair deal.

~~~
neuroelectronic
I'm pretty sure this is dramatized to fish for more sales.

------
mcantelon
>Amazon gets to set the price of your app to whatever they want, without any
input from you, or even the chance to reject their price ... Amazon re-writes
your description, and in ours they even made up things ... you can’t remove
apps from their store

That doesn't seem great.

~~~
robtoo
To be honest, this is true of _every_ product that Amazon sells.

~~~
irons
But it's not true of any other app store with which Amazon competes. Whether
or not it's true of Walmart isn't really relevant.

------
akeefer
I was curious what their developer agreement actually says; I didn't bother
signing up us a developer, but their FAQ states:

"What is the payment structure between Amazon and me? Amazon pays developers
70% of the sale price of the app or 20% of the list price, whichever is
greater."

<https://developer.amazon.com/help/faq.html#Sales>, Payment and Tax

That's clearly the bit the author was referring to as being deceptive: in
public they state that developers will always get at least 20% of the list
price (which leads some people to think developers still get paid when their
apps are listed as free), but in private they ask developers to take 0% of the
list price when they promote the app as the "free app of the day."

------
woodall
My worthless 2cents.

> Did the exposure count for much in the days afterwards? That’s also a big
> no, the day after saw a blip in sales, followed by things going back to
> exactly where we started, selling a few apps a day. In fact Amazon decided
> to rub salt in the wounds a little further by discounting our app to 99
> cents for a few days after the free promotion.

Well here is the image with sales numbers from the day after.

<http://i.imgur.com/bBovl.png>

What I'm seeing is a a huge sales/profit increase; $300 that day as compared
to <$50 before. Full discloser, i.e. sales from the subsequent days, would be
very nice to see at this point.

Next logical step? You have a >100,000 user base so push an update to the free
app so that it now includes ads.

The tone of the article feels like the author is just upset he didn't get his
way- "I was against putting the app on Amazon and my partner was for it"- so
now he is trying to make himself appear "right". It's called pivoting.

~~~
phreakhead
"You have a >100,000 user base so push an update to the free app so that it
now includes ads."

The problem is, the users who got it when it was free got the PAID version, so
they can't push an update to the people who got it for free without making all
the users who ACTUALLY paid also get ads.

They'd also have to add ads to the paid Google Market version, since the
Amazon dev agreement requires that you keep app versions synchronized across
all app stores. Amazon has basically put them in a position where they can
only lose money or piss off their actual paying customers.

~~~
woodall
That makes a lot more sense, however, it's not entirely impossible for them to
find out what users downloaded the app on that day and only target updates for
them; they want out of amazon any way might as well break the TOS. They should
be logging some type of 'first_install' after every user pings the server for
the first time... but I'm making excuses for Amazon.

TBH both parties are at fault. Them for not reading the letter Amazon send
WORD FOR WORD and not Amazon for discounting their app to 99cents the day
after.

------
wallflower
I've been doing a binge of Kindle buying recently, and I have noticed that a
lot of the more expensive books have a price that is set by the publisher.

Now, in the Amazon AppStore, perhaps the larger publishers will eventually be
able to set a minimum price. The prices are already so low but better than
zero.

I love Amazon's FAAD, and I feel safe downloading any app from Amazon while
the Google market is more strip mall than indoor mall. The new Market app is a
major improvement though but I am anxious to download let alone buy anything
with less than 250k downloads.

------
jexe
It seems like a purely promotional placement, Amazon isn't giving you money
that neither you nor they received -- that seems perfectly reasonable to me.
If you don't want to bear the auxiliary costs like server load or customer
service, you don't have to agree to it.

If Amazon is correct, though, this promotion should mean that post-promotion
sales are higher than pre-promotion sales. But the chart ends on the day of
the promotion. Though there's a little text about it, I'd be curious about
more detail on how things are shaping up afterwards.

Either way, up to them of course, but it feels a bit extreme to me to abandon
ship because of agreeing to an unsuccessful promotion and because they're
behind in features vs. the Google market.

------
nekgrim
Duplicate : <http://news.ycombinator.com/item?id=2836024>

~~~
seanalltogether
It's weird, I tried submitting this story about an hour ago and was taken
directly to that thread instead of it going through the system, I wonder why
this link made it through?

~~~
Macha
This link is to the https version, the other (and presumably your attempt too)
was to the http version.

------
foxit
There are a lot of points in this - both in the sales pitch that Amazon gave
the developers and the outcome of having participated - that are strikingly
reminiscent of the Groupon experience for some businesses. (Many, even, based
on the links dibarnu posted.)

<http://posiescafe.com/wp/?p=316>

~~~
neuroelectronic
I guess you're leaving the actual comparison as an exercise for the reader.
IIRC, both involved people who had little business savvy and a missed
opportunity presented as a regretful decision. no money is exchanged here
however, and they never detail the cost occurred to them by the extra load.

------
kemiller
My understanding was that the 20% figure applies only to cases where Amazon
changes the pricing of your app without your specific approval (which they can
do). There is apparently enough demand for the top spot that they can ask the
developer to take the hit. Up to them whether they do or not.

------
jamespo
Are there any stories of positive experiences (for Developers) with Amazon's
App Store? This is the second bad one I've read on here.

------
Jacobra
It seems like small developers could get around this by releasing some kind of
trial edition on the free-app-a-day promotion.

~~~
rkalla
From what I understand, Amazon won't feature a trial or "lite" version of your
app for the Free App of the Day. It doesn't have the same value-proposition
for users.

------
MaysonL
What this story teaches is a simple business lesson.

If you give an app away, you should build in some monetization.

------
ghempton
Lots of larger studios actually _pay_ to acquire installs of their app to get
an initial placement on the charts and to drive organic growth from there. In
that context, 101k new users for free is very valuable.

~~~
barredo
But it didn't get any growth (at least the 5 next days) and it is costing them
server money to provide service to these new users

------
shareme
Remember folks, its 20% after Amazon twists your arm to price all android
products not in Amazon store at Amazon's prices..

