My first corporate gig was doctoring PowerPoint slides for Investor Relations executives. They’d send me their .ppt files full of bolded, underlined, and horrifically colored monstrosities, and it was my job to turn it all into something presentable. The first part of that process involved stripping out all the terrible formatting they couldn’t resist putting in.
I understood their desire to play around with the controls, but the bottom line was that they were making both of our jobs harder. They were spending hours playing with font colors that should have been spent calculating figures. And I was spending hours removing those font colors. I would explain to them, “Just give me text on blank white slides, and I’ll do the rest,” but they never listened. At times it was faster to retype all their text and charts from scratch.
My theory: Business school was teaching just enough PowerPoint to be dangerous. Understandably, advanced PowerPoint techniques and graphic design skills were not part of the curriculum, as there are more vital topics on which to focus in Business school. But just introducing students to the kinds of things you could do in PowerPoint without showing them how to do it well was problematic. They’d be better off teaching students to write out presentations on legal pads and let the graphics department handle all the computer stuff. Or else, if you only have a few hours to show them PowerPoint, teach them how to use Master Slides and Styles, and how to hide the manual formatting tools lest you be tempted to use them.
Fast forward to several years later, and I’m talking to indie devs about how they go about pricing their apps. Time and time again, I hear “supply and demand” and “what the market will bear,” and I can’t help but think that maybe Computer Science schools are teaching just enough business to be dangerous.
It’s so tempting to think that software prices are sinking to oblivion because people aren’t willing to pay for software anymore, but that’s simply not true. Sometimes I feel like I’m talking to the wall trying to convince nice people that making our apps 99 cents or free isn’t going to make us rich. That’s it’s basically throwing money away.
And then along comes Michael Jurewitz with his economics degree and considerable clout in the Apple developer community. I can’t tell you how happy I was just knowing this 5-part series had been written, let alone the joy I felt while reading it. Here was someone with real experience, and most importantly, empirical data to back up what I’ve been trying to tell my fellow indie devs for a while now.
My theory going into this analysis is that the phenomenon of falling prices, as much as we would like to attribute this to the market around us, has largely been a self-inflicted wound.
If you’re interested in the economics of app development at all (and if you’re an indie dev, you are required to be interested) you should take the time and read all five parts of his piece. It’s very enlightening.
Of course there are some apps that should be only 99-cents. Of course In App purchase and freemium aren’t always bad things. But the most important lesson to take away from Jurewitz is that apps are not all created equal. That there’s a sweet spot price where revenue is maximized for any app, and that number is different for every app. And the decisions we make about which apps to build should be at least in part influenced by a careful analysis of future earnings potential.
I can’t claim to be a business genius. My degrees are in Secondary Education and English. But I know enough to know I should get my advice on business matters from business experts, not other developers who know as little as I do. You need to break out of the echo chamber of other devs commiserating with each other and listen to people who have actually made a decent living at this thing.
I find that indie developers tend to be 1) generally very nice people, 2) extremely smart 3) hard working problem solvers. Laziness is not a trait you often find in this group. And so I would encourage developers, the next time they’re tempted to spend a free few hours toying around with that new API, or learning another language (both good pursuits, by the way), to try to find themselves a good econ 101 book or enroll in a business class or two. I know I will.
As Jurewitz points out in his piece, we’re in this thing to make money, whether we want to believe that or not. The top goal may be to just keep making great products, but you can’t do that without sufficient revenue.
I suppose when your job is to play with numbers all day, you’re really starved to show some artistic creativity occasionally. If the company had paid for these guys to take a figure drawing class on company time, just to let them scratch that itch, I think it would have been a good investment. ↩
The charts Jury presents in his series are, by his own admission, only based on a small sample of data. But it’s real data, and it’s the kind of data any one of us can collect and analyze for ourselves. The more we start doing this and sharing our findings with the community, the better off we’ll all be. ↩