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A Counter-Counterpoint

Marco.org: “But searching for ‘teleprompter’ in the App Store today brings up about 40 other iPad teleprompter apps. About a third of them are free, and almost none are anywhere near Teleprompt+’s $14.99 price, with most paid alternatives around $3–5. And that’s just for iPad — the iPhone app market is much larger and even more competitive in most app categories.”

(via. marco.org)

Marco had some interesting comments regarding my post from earlier today. I think this quote above is where we’re not seeing eye to eye. He’s assuming that I’m competing with $3-$5 Teleprompter apps. I’m not. The people who want a low-priced, casual teleprompter app for iPad are far fewer than the professionals who need them as part of their studio setup. We’re not only outselling all of those competitors every day in revenue, but also in number of downloads, by a pretty wide margin. What most of those low-cost competitors have learned is that they can’t keep up with us on so little money per sale. We can barely do it at $15, trying to feed three people. 

If you look at our page on iTunes, and check out the “Customers Also Bought” section, you’ll see that there are few other teleprompters listed. Most people aren’t even bothering to check out the cheap alternatives before buying our app.

If you look closely at the bulk of those 40ish other competitors, you’ll note that the majority of them haven’t been updated in several months or years. Trying to compete on low price, in this one niche market, is proving to be a poor strategy.  

Yes, I understand we’re in a niche. But it’s a profitable niche. And it’s a niche where free with IAP makes little sense at the moment. And there are dozens of other niches just like it.

None of the $3-$5 apps offer the features our users need, because those features take serious time and investment to create. You can’t create that functionality when you’re making $3 per sale. 

Of course, there’s no reason someone couldn’t come along and create a free-to-download, $15 IAP teleprompter. But my point is that as long as that app is listed as “free” the pros who tend to buy our app will likely ignore it, or at least be severely turned off by it. And any casual users it does attract will immediately balk at the high $15 IAP, and write us a one-star review while they’re at it. So in our case, I don’t see free with IAP working out, at least not until the stigma of IAP being a scam is eradicated in the minds of small business owners.

Now, at the end of his post, where he says this: 

“There are a lot of developers making a lot of iOS apps, and competition is fierce. It’s unwise to assume that any profitable niche is safe from being undercut by free alternatives.”

I completely agree. I certainly don’t expect this one app to continue to grow indefinitely forever. We’re looking into many different strategies for future products. All I’m suggesting is that there are still a lot of ways to make money on the Store. Offering one of them as the “only” way, or saying one pricing strategy is completely “dead” is overstating it a bit.