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Old Nov 28, 2012, 10:48 AM   #1
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Realmac Goes Deep Into Its 'Clear for Mac' Pricing Strategy




Realmac's decision to price the Mac version of its popular todo app Clear at $15 raised some eyebrows, with the company choosing to launch at a much lower price point and raising the price later.

In a blog post today, Realmac's Rob Jarman laid out the company's pricing philosophy, as well as some thoughts on app pricing in general:
Quote:
Like most of us, when it comes to parting with my hard-earned money I'm an advocate for being prudent. To help decide on the value of something, I tend to use a "beer strategy". While trying to decide if I really wanted something I would work out how many pints I could get with the same money, then by missing 1 night out I'd make a guilt and hangover free purchase. By applying this strategy to our latest release of Clear for Mac for example, 6.99 could just about get you 2 pints. So for a piece of software that will increase my productivity, that I'll use every day skipping those two pints is an easy decision.
Quote:
Now how about those Hiut Jeans I've been thinking about for a while? 40 pints. That's a few nights out, so I best start saving! I've chosen both our app Clear and Hiut Jeans for a reason. Both have a story, have had many months of development, and been built by people with a passion for what they do.

[...]

There are other todo list apps available which are cheaper, free even. There are apps which have way more features, and those that cost much, much more. So how does that change our perception of value? In our opinion, it doesn't. You won't find the same user experience with any other apps. The use of gestures is unique, and the simple approach to task management is unparalleled. The care we put into making sure the user experience is the best it can be is evident in every element of the app.

Now lets apply that thought process to the Hiut Jeans, why would I spend 130 on a pair of Jeans when I can pick up a pair for 20 on the high street? Because of the fit and finish. Because they were made by a "Grand Master" seamstress, using a sewing machine in Cardigan Bay, Wales. Because of the story. Because of the way they would make me feel. Because of sustainability. Just because software is a less tangible product, doesn't mean that the making behind the scenes differs in any way.
Article Link: Realmac Goes Deep Into Its 'Clear for Mac' Pricing Strategy
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Old Nov 28, 2012, 10:51 AM   #2
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I used the same strategy in college on whether or not to eat that week
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Old Nov 28, 2012, 10:51 AM   #3
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Hah. Just keeping fishing for logic there. $15 for this app is too much. People would rather have an app that works nearly as well for $2 or $5.
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Old Nov 28, 2012, 10:54 AM   #4
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I'd rather give up 1 pint instead of 2.
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Old Nov 28, 2012, 10:54 AM   #5
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Quote:
Originally Posted by Ryan.Tanner View Post
Hah. Just keeping fishing for logic there. $15 for this app is too much. People would rather have an app that works nearly as well for $2 or $5.
I don't think they ever actually charged for $15 for this app. The current price is $9.99, which is what it has been at ever since they charged $6.99 during a 48 hour promotional launch period.
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Old Nov 28, 2012, 11:03 AM   #6
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I use notepad or textedit, depending on which system I'm on. I don't get the need for a $15 app like this.
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Old Nov 28, 2012, 11:04 AM   #7
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Quote:
Originally Posted by Ryan.Tanner View Post
Hah. Just keeping fishing for logic there. $15 for this app is too much. People would rather have an app that works nearly as well for $2 or $5.
Things is $49 and nobody complains... It's also the benchmark for GTD apps.

I'd add a modification of "Joel on Software" (I think) of software as the development cost plus an opportunity cost to keep the developer in business so you get updates.

When a piece of software is new, it can be very cheap... But there is little guarantee your developer is going to support a $2 app for very long... YOU only paid $2 so you can't really complain. So to build base, they start at a low price... Early adopters absorb the risk of the app not being around long, or beta versions. Now that "early adopter dues" are paid, and the product has rave reviews, they can raise the price as there is less risk to people purchasing now.

RealMac tends to turn over their software a little more than I'd like personally... But the award for paid version turnover has to go to Bento right now... They got no happy users.
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Old Nov 28, 2012, 11:04 AM   #8
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In other words, if you drink lots of beer and can't remember what you're supposed to do, you can use the Clear to do app so you'll be able to make enough money to buy some designer jeans...
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Old Nov 28, 2012, 11:06 AM   #9
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I'm sure those jeans are as awesome as your high opinion of your own software, but sorry, I won't be helping you buy those jeans.
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Old Nov 28, 2012, 11:08 AM   #10
Mike Oxard
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So the real reason they priced it so high is so he can buy some Hiut jeans?
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Old Nov 28, 2012, 11:09 AM   #11
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Quote:
Originally Posted by Ryan.Tanner View Post
Hah. Just keeping fishing for logic there. $15 for this app is too much. People would rather have an app that works nearly as well for $2 or $5.
A few years ago, $15 for an Mac app of this caliber would have been considered a bargain. It's interesting how "app store economics" have changed people's expectations.
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Old Nov 28, 2012, 11:14 AM   #12
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Hmm, I think his blog post is a little patronising.

I'll be the judge of whether I find something expensive or not, thanks!
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Old Nov 28, 2012, 11:16 AM   #13
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The app isn't that good. There are plenty of apps like it for much less. So their beer analogy will fall flat. Should I give up beers, or go with another similar app where I won't have to give any beers for... and be just as productive.
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Old Nov 28, 2012, 11:16 AM   #14
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The response to this is going to be fairly predictable. Those who write apps will feel some sympathy with RealMac Software. Those who buy apps will say that it's too expensive. Probably.

Being a developer myself I fall into the former category. I'm going through a similar thought process for an iPad app I'm just wrapping up development on. It's taken many hours to create and I've spent a huge amount of time carefully putting it together. I had to bring in an expert for the subject matter I'm working on and she also invested lots of her time in the project. We will split any profit between us.

Similar to RealMac software selling my app for less than a fiver just won't do it justice, however I know that if I charge much more than 1.99 for it, it probably won't sell - however good it is.

When I first started developing apps for the iPhone, before the iPad was in the frame, I remember telling a friend about a project I'd been working on with some colleagues. I'd written the code, one other guy had created the graphics and the other had developed the concept and tested. We'd decided to charge just 99p for it, even though - with 3 of us involved - it would take forever to earn anything close to the money needed to pay for our time. This is before iAd or the move into freemium app models but he couldn't understand why we weren't giving it away for free. And this guy runs his own business. Scary.

The bottom line here is that people want a bargain and don't want to pay a reasonable rate for other people's hard work. They shop in cheap supermarkets and don't understand why their food tastes horrible and buy cheap clothes that in 2 washes are falling to pieces.

I will be flamed to within an inch of my life here, I realise that, but however much I don't like it - that's the way it is.
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Old Nov 28, 2012, 11:19 AM   #15
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I don't see his logic. 2 pints of beer...or $300 USD skinny designer jeans from a denim mill in Japan? Okay guy!
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Old Nov 28, 2012, 11:19 AM   #16
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If it were not a simple copy and paste app from iOS, I would buy it for a reasonable price.

But, people making me pay for the same app doesn't happen. I refuse to buy those apps. I won't support devs who milk me for money without any additional features.
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Old Nov 28, 2012, 11:20 AM   #17
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Quote:
Originally Posted by i-John View Post
The app isn't that good. There are plenty of apps like it for much less. So their beer analogy will fall flat. Should I give up beers, or go with another similar app where I won't have to give any beers for... and be just as productive.
Exactly

I don't care how much a developer works on his app, if it sucks then it is not worth it. The problem with apps on the app store is you can't try them out before you buy it so yea, taking a gamble

Doesn't help when there are usually better cheaper if not free apps

----------

Quote:
Originally Posted by dearfriendx View Post
I don't see his logic. 2 pints of beer...or $300 USD skinny designer jeans from a denim mill in Japan? Okay guy!
I like how he compares himself to expert seamstress jean makers
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Old Nov 28, 2012, 11:31 AM   #18
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What puzzles me is that their other app Courier (which I love) is more complex, but only $9.99 too. It looks premium, it works like a premium product, and it's very, very good. How is Clear more worthy of being priced higher? Especially when it's not even near the quality of Analog.
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Old Nov 28, 2012, 11:34 AM   #19
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I bought Tweetbot for $20, but not this. Why Realmac?

Last edited by komodrone; Nov 28, 2012 at 11:48 AM.
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Old Nov 28, 2012, 11:37 AM   #20
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He said in 100+ words what he could have said in two: money grab
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Old Nov 28, 2012, 11:49 AM   #21
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Who the hell cares about the "story" behind software. Here's a story - a bunch of sweaty neckbeards sit in a disgusting lab area eating doritos and drinking mountain dew and farting, and out comes the Unreal engine. It's awesome. And basically nobody cares about the 'story' leading to it.

In software (and really, anything else), the only tangible is the end product. Sorry

----------

Quote:
Originally Posted by Reason077 View Post
A few years ago, $15 for an Mac app of this caliber would have been considered a bargain. It's interesting how "app store economics" have changed people's expectations.
And now, people actually buy them, instead of 5:1 people pirating it, so it all works out for everybody if he prices it around $3 which is fairly standard

Last edited by iRCL; Nov 28, 2012 at 11:49 AM. Reason: Typo
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Old Nov 28, 2012, 11:54 AM   #22
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It can be interesting to hear the thought process behind pricing an app - but in this case the reasoning is leaving a lot to be desired. I thought we'd hear more about some real analysis of apps and pricing strategy, not a comparison to a pint.

I was happy to invest in OmniFocus (Mac, iPad and iPhone versions), to me there is a high value on a system that I can trust to make me more productive (imagine Things users feel the same way). Clear has not established that level of value, in my opinion, so I didn't but it.
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Old Nov 28, 2012, 11:56 AM   #23
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Reminders does the same job. Comes free with every Mac and iOS device.
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Old Nov 28, 2012, 11:59 AM   #24
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I'd like to hear his reasoning for not adding support for 10.7 Lion. He could buy a hell of a lot of jeans if he didn't abandon customers with older macs.
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Old Nov 28, 2012, 12:12 PM   #25
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Quote:
Originally Posted by AJClayton View Post
The response to this is going to be fairly predictable. Those who write apps will feel some sympathy with RealMac Software. Those who buy apps will say that it's too expensive. Probably.

Being a developer myself I fall into the former category. I'm going through a similar thought process for an iPad app I'm just wrapping up development on. It's taken many hours to create and I've spent a huge amount of time carefully putting it together. I had to bring in an expert for the subject matter I'm working on and she also invested lots of her time in the project. We will split any profit between us.

Similar to RealMac software selling my app for less than a fiver just won't do it justice, however I know that if I charge much more than 1.99 for it, it probably won't sell - however good it is.

When I first started developing apps for the iPhone, before the iPad was in the frame, I remember telling a friend about a project I'd been working on with some colleagues. I'd written the code, one other guy had created the graphics and the other had developed the concept and tested. We'd decided to charge just 99p for it, even though - with 3 of us involved - it would take forever to earn anything close to the money needed to pay for our time. This is before iAd or the move into freemium app models but he couldn't understand why we weren't giving it away for free. And this guy runs his own business. Scary.

The bottom line here is that people want a bargain and don't want to pay a reasonable rate for other people's hard work. They shop in cheap supermarkets and don't understand why their food tastes horrible and buy cheap clothes that in 2 washes are falling to pieces.

I will be flamed to within an inch of my life here, I realise that, but however much I don't like it - that's the way it is.
AJ, you raise some good points.

I'm not a developer, but I do run my own little business and people focus way too much on PRICE these days. I'm not sure if it's just a down economic time or the fast paced technological world we know live in where people simply don't have patience or a combination of both.

But regardless, people focus too much on price without worrying/caring about the time gone into a product or how much they'll use it.

They've also forgotten about another key element - VALUE! If there's no value to you, then don't buy it. If there's value and you think it's worth it to you, then buy whatever it is you're hedging on.

There are a number of apps I use all the time and VALUE more than others. If an app out there would do what I want, then I'm all in. The price would be justified to me. Might be worth it to others, might not.

Also, there's something to be said for this company keeping their price as is so they can somewhat control their user group. ie. if they care about their product and want to improve it, I would then think the feedback coming from a user who valued the product at $15 would be someone who actually uses it often and has a vested interest in its future.

Versus joe blow who paid $0.99 for it, hardly uses it and b*tches about it to the company on feedback forms, emails or calls.

I'm like that with my business. My prices are based on my costs, time and the value I provide. If someone comes to me and says, well, joe blow does it for x amount less than you, then I say go to them then. Do i lose some business? For sure.

But I also lose most of the headache clients who don't see nor understand the value. In the past, I did bow down to price pressure, but since I stopped doing that, I'm alot less stressed trying to gain business by working for those who want the work done.

As I told a client just 2 days ago (whom I've done work for in the past), I'd rather go to a movie or have a nap than work for minimum wage on a project that is worth more - especially when he didn't see the value. lol

Cheers,
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