It’s About The Value

January 31, 2015

Marco Arment’s recent post regarding the revenue story of Overcast seems to have opened up a new chapter of realism in the dialogue about the indie software business. Excellent commentary regarding Marco’s post can be heard on the Release Notes podcast episode #89, and I’d like to take that discussion a few steps further.1

The App Store Is a Distribution Mechanism, Not a Marketing Strategy

Apple has given us a marvelous distribution mechanism that indies from my stardate of origin could only dream about. It provides a storefront that reaches across the globe, it collects/refunds the money, it handles currency exchange, it deals with taxes, it provides a EULA, it has a decent-enough back-end for us to “stock our shelves”, and we don’t have to hire a single person to worry about any of it. In view of everything it does, it is a bargain at 30% off the top. Not one of us could replicate it for ourselves, nor would it be the best use of our scarce and precious time.

As indies, we love to code – we love to build cool things in software – but after an app’s been through the review cycle and lands on the store, we’ve only finished 10% of the job. The remaining 90% is getting the word out to tell the world we’ve just built something really useful, or more to the point, “Here’s how it’s going to help you, Mr. Customer.” It’s about selling, and unfortunately, no one is waiting in the wings to do that for us. It’s no different than publishing a best-selling book. I would love to finish an app and throw it over a wall to someone else to market and sell it, but sadly, it just doesn’t work that way.

To be successful, we must come to peace with the dreaded “s” word: “selling”.  Marco’s success with Overcast can be traced to having both a great app and a platform to launch it from. It wasn’t the first app he chucked into the App Store, said a prayer of hope, and then magically collected a bag of money. His hard work in the past in both app building2, podcasting, and writing has built an audience for his work. Marco definitely knows how to get his message out3.

My personal indie challenge this year is to do the same: build a platform so I can get my own message out into the world. So what exactly is an indie’s message?

Helping People

The purpose of software is to help people become better in some way. A useful app helps someone personally, professionally, in their business, or perhaps just to enjoy life more. But regardless of how an app does it, helping others in meaningful ways means that the app has value. But no one will receive or benefit from that value if they don’t know it exists. If the word “selling” turns you off (as it does me), then just think of it as making others aware of something you have that is going to help them. And if it does that, they are gladly going to put money into your hand. The challenge is to make enough people aware of your value so that you can have a sustainable business.

The message that we need to learn to communicate is the value that our apps bring. We have to make people aware of the transformation, or the awesome outcome, or just the simple enjoyment (I’m looking at you Crossy Road) that our software is going to bring them.

If you’re reading between the lines here, you’ll notice that I’m putting people ahead of money. I strongly believe if you concentrate on helping as many people as you can, the money will follow automatically. It simply has to, and that brings us to the question of price.

Free is Patently Absurd

There has been much weeping and gnashing of teeth over the last couple of years that the price of software is approaching zero, and that indies will be snuffed out of existence. If your software delivers genuine value, that notion just doesn’t make sense.

Ben Thompson’s theory that free is inevitable is fascinating, but I don’t find it convincing, and definitely not a reason for hand-wringing. The marginal cost of producing software is unrelated to the value actually derived by the customer. Ben’s assertions about perceived value do make sense, but it’s somewhat of a red herring. Either an app helps to improve someone’s life in some way, or it does not. It’s binary condition that remains true for the lifetime of the app. The value to our customers doesn’t change unless their needs change and our app is no longer a good fit for them. I will concede that the “value perception” problem does make our jobs harder, but that doesn’t mean our work suddenly has no monetary value.

Another factor pushing on price is competition. Cleary there is a maximum price that any market niche will bear, and we need to do our homework in that regard, but a competing app simply being cheaper is often not a good reason to lower your price. Why? Because the person who buys a competing app based on price, or any reason for that matter, is likely to be someone who didn’t see how they would benefit from the unique value you offer, meaning, something about the way you designed the app probably didn’t resonate with them. If it did, price would be not be an issue, within reason, of course.

As an example, I’ve got a music app that people have told me they’d pay more for because it’s simpler to use than the category leader. On the other hand, I’ve had people say I’m charging too much because I don’t have all the features of the category leader. So who is my ideal customer? The one who loves it the way I built it. She is getting the most value from it – in her mind it probably feels like it was built just for her. Our individual voice, expressed through the design of our apps, will resonate with some and not with others, and that’s perfectly fine.

Pleasing everyone is not the end game. It’s about helping as many people as possible. And those who love our work will typically not question the price. They’re getting the value they want and will happily hand us their dollars. I have a hard time imagining they’ll somehow think it’s worth less because it’s a virtual vs. a physical product.  That’s just not been my experience4.


So my take-away for us indies is this: We are creating value and helping people, and we have to get better at telling others about it. If we focus on doing that well, the money will follow. It must.

  1. If you’re serious about the indie software business and don’t listen to Release Notes, you should stop reading this now and subscribe. Highly Recommended.
  2. I believe Marco would say app “making”.
  3. He also has a good sense for making the freemium model work. Study what he’s done with Overcast. You can learn a lot. I certainly have.
  4. I started my first indie software business in 1981.

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