

Or How I Learned to Stop Worrying and Love Premium - mkoivuni
http://www.techamo.com/2011/12/01/or-how-i-learned-to-stop-worrying-and-love-premium/

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BrandonMTurner
I think people generally just have a really hard time understanding the value
of a non physical good.

The product I work on has this very problem. We have saved thousands of
people's lives with the application we made. Seriously, we get an email every
single day where someone explains how they lost 50 or more pounds using the
product we make and it took them from being pre-diabetic with high blood
pressure to normal insulin levels with normal blood pressure. They have full
energy again and are living a wonderful life now. This does feel pretty good
when we hear these types of things, however we are a startup and we have
investors that want to see a return. If the user does mention money, they
always say how happy they are that they would easily pay 99 cents, maybe even
all the way to 5 dollars for the app now that they know how good it is. Thats
not a good sign for us. We made something that saved their life (maybe
forever, maybe they will gain the weight back over months time period) and
they value it at the same price as value meal at McDonalds that has a short
term (maybe 20 minutes of enjoyment) and has the reverse effect on their life.
I don't think the users measure the value the same way because our application
is not a physical good. It is assumed by people that apps, software, or
websites are little worthless toys that should be free (I don't know how
computers came along and all of sudden people didn't want to pay for anything,
though I did fall in this trap until I got my degree and worked in the field).
I know my mother has this problem as well, the only apps she has ever bought
for her iPad is when I bought her a iTunes gift card for her birthday. She
loves the apps she paid for more then free ones. Especially, Words with
Friends for example, but she has a hard time rationalizing how it is worth ~4
dollars yet has entertained her at least 20 minutes everyday day for the last
year, and she hated the advertisements in the free one!

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mkoivuni
Brandon, I completely agree. Though as someone who dabbles in mobile
development on the side I am encouraged by recent trends. As developers become
less willing to give away high quality apps for free or ruin the experience
with advertisements, I think we will see a trend where more apps will be pay
only and users will be forced to acclimate themselves to paying for apps in
order to use the latest and greatest technology. I especially think the gaming
side of mobile will help to drive away this resistance to premium. As hardware
specs increase and the quality of games converges with those on PC and console
platforms, I think the price will do the same. It will take time.

