Mobile Sands

February 21, 2009

Android Market’s Return Policy Will Discourage Developers

Filed under: Android, App Store, iPhone, New business models, Ovi, Smartphones — AJ @ 5:03 am

Looks like Android team did not see PinchMedia’s presentation on “iPhone AppStore Secrets” before publishing Android Market Business and Program Policies that allow buyers to return an app within 24 hours of purchase! 

PinchMedia is a New York based company that provides app developers with an analytics library to monitor usage. 30 million of the over 500 million downloads from Apple’s store had their analytics software. The numbers collected by PinchMedia show that less than 30% of people who paid for an app used it after 24 hours.  This is not surprising considering that the average number of apps downloaded per iPhone exceeds 30. Those who did not use an app 24 hours after buying it effectively got suckered, but considering that most apps are priced around $0.99, looks like many consumers don’t mind doing a paid trial.  And if you are a developer burning the midnight oil, paid trials rock.

No one gets paid trials in the Android Market (are paid trials evil?).  So once buyers realize that the new fart app (or the advanced tip calculator app) is’nt any more useful than the one they already have, they return it.  This no questions asked return policy will definitely increase the number of paid applications trialed, but is it good for developers?

I don’t think so. The folks at Google could argue that “no-questions asked” returns leads to happier customers.  But will these happier customers pay more for apps on the Android Market than they do on Apple or Nokia’s stores? Unlikely. With a few exceptions, two apps that do approximately the same thing will be priced at approximately the same price in different app markets.

If the average retun rate on Android turns ends up being 75%,  a developer will need four times as many downloads on the Android Market than it  gets on the Apple’s store to make the same amount of money.  That may happen someday, but for now, developers are better off creating paid applications for Apple and Nokia’s Ovi (Symbian) stores.  And I hope the folks at RIM do not follow Android’s path while creating the Blackberry Store.

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