Racing to the bottom, now we’re here. Or how does an indie developer survive in 2016?
I belong to a lucky minority of people who knew what we wanted to do in life since the early teens. I wanted to be an “indie app developer” even though I didn’t know any of these words back then. I knew that I wanted to create software on my own or with a small team of friends and make a living by selling this software directly to the customers.
Ten years later the internet made this dream possible. Thousands of independent developers started publishing their software on the internet in the form of shareware and making a living from what they loved to do. Soon enough corporations discovered the internet as a sales channel and cut the ground from under the indie’s feet on the top of the pyramid. And hobbyist developers did the rest from the comfort of their corporate day job.
Most independent developers had to either get acquired by bigger companies or get “real jobs” and turn their products into hobby projects or just abandon them.
Fast-forward another 10 years or so and we get the Apple App Store. Indie developers are empowered once again. Unfortunately it doesn’t take long for the history to repeat itself.
Bigger companies have mastered the science of optimizing lifetime customer value vs. user acquisition costs, while hobbyists and companies that don’t care about direct revenue from the apps create a free alternative for anything indie developers come up with.
You may have an app that is actively used by 100,000 people — a bizarre number for a successful indie developer from the 90s — but you can only expect that 2% of them (upper bound of a de-facto industry standard) will ever pay for a new feature if you decide to release it as a paid in-app product. At a “standard” price of $0.99 you are looking to make around $1,300 at best. And the feature better provide a huge improvement over the free/previous version or you are going to hear from a lot of angry users questioning your integrity by “daring to charge 99 cents for that!!!”
So, where do we go from here?
25 or so years since my lifelong indie developer dream has formed, I still feel like this would be the perfect life for thousands of people like me. If I was fifteen again, I would still want to be an indie app developer. And it feels like more and more professions are moving into this “entrepreneurial” realm: journalists are leaving big publications to start their own blogs and podcasts, musicians leave the big labels, filmmakers make great documentaries with just a camera and a laptop, etc. Yet, it seems like software development is going in circles — a moment of empowerment for the small guys is followed by a long sobering period of disillusionment. Rinse, repeat.
In 2010, when my indie developer dream hit an unexpected wall (long story), I almost accidentally switched from trying to become a successful indie developer myself, to helping my indie developer friends reach success. At the time I’ve launched AdDuplex in early 2011, the main challenge for indie developers was getting discovered by the potential users. It seemed that once you get in front of enough of users the tools provided by the app stores and ad networks would let you lead a decent life. However now, in 2016, it doesn’t seem to be the case anymore (see the tweet above).
In 2016 you need a team of data scientists and behavioral economists to figure out the best way to squeeze every penny out of your users without alienating too many of them. And another team to figure out where to get those users at scale for the price below what the first team managed to get.
But does it have to be that way? Do we have to suck it up and get “real jobs”? Do we have to wait for another cycle to get our 15 seconds of happiness once again? Could be. Maybe that’s the only way — manage to grow into a corporation while some market is hot or go home. Maybe. But I don’t want to accept it. I want to try to find other ways for indie developers to be successful. And that’s what we are trying to do with our new product — AppStretch.
Our thesis is that out of the 2% of people willing to pay for something in your app there are 20%, 30%, maybe even 50% who are getting great value and joy from your app or game. And they are definitely willing to pay more than the measly 99 cents to get that new feature. Some may pay $5, some $10, some may even pay $50. And maybe there are even a few of the users who get enough value to justify spending a $1,000.
Additionally, these are the people who enjoy your app enough to have an informed opinion on how it can be improved — so why not give them a voice and also let them put their money where their mouth is? And, since not everyone is in equal economical situation and not everyone is able to spare even a $1 on an app they love, why not give them an opportunity to support you in some other way… like promoting your app through their social media accounts? This is exactly what AppStretch does — gives indie developers and their loyal fans a tool to make their apps better by crowdsourcing feature ideas, crowdfunding implementation of these ideas and crowdpromoting their availability.
We believe that this can re-enable indie developers without the need of another major market shift and we would love for you to join us on this mission.
