At $.99 a Pop Can You Afford Sparkling Customer Service?

Matthew Campbell, June 2nd

CustomersMany software developers take pride in being able to over-deliver on customer service. In fact, indy Mac developers are often credited with having outstanding customer service that distinguishes them from the big development shops.

When I first investigated iPhone app development as a business the app store was not opened yet; the only thing I had to form my expectations was the experiences of the indy Mac developer community. Two things that really stand out when you look into how the indy Mac community does business is (1) outstanding customer service and (2) an almost fetishistic emphasis on the “beauty” of the software product.

For Mac development this seems to work well – I have many Mac desktop programs written by indy developers that I never would have bought from big shop Windows developers. And I have been very happy. These desktop programs usually cost between $19.99 and $99.99.

I also know from some research that indy Mac developers will usually respond to your email complaints within 24 hours; one of the reasons for the legendary indy Mac customer support that distinguishes them from the big guys.

Now, lets take the iPhone app scene. In contrast to a market that is more than willing to spend $19, $29 and even $99 on a desktop software product, iPhone app customers balk at any price higher than 99 cents.

So, assuming that you need to bring in a revenue of $150 per day to replace your income as a programmer you would need to sell 215 copies of your app each day after Apple takes its cut. If you were selling that app on the desktop (and charging $29) you would only need to sell 5 copies each day.

As an indy Mac developer you could afford to respond personally to every single person who bought your software even if they did not have a complaint. As an iPhone developer even responding to 10% of your daily customers (22 emails each day) would overwhelm you quickly.

Not only that – assume that your time is worth about $100/hour (the rate most American companies on the charge for programmer time). In this case spending 15 minutes responding to a customer complaint in email is costing you $25. As an iPhone developer the product that customer bought brought in a revenue of 70 cents. That customer service call actually cost you $24.30!

Sure, this response for a Mac desktop developer also takes out a chunk – but s/he would at least still bring in a profit of $4 on that sale. A Mac developer also seems to benefit a lot more from positive customer interactions in terms of loyal customers who want to buy other software programs from the developer. iPhone app sales seem to be a lot more of an impulse buy based on visibility on the app store.

In short, sparkling customer service is an investment for the Mac developer and a liability for the iPhone programmer. At least on paper. Of course, this does not mean that you cannot provide a
great iPhone product but you do need to keep the reality of the business model in mind when you are working out how you are going to monetize your work.

With this in mind – what do you think about providing outstanding customer service to your iPhone app customers? Is it worth it? Why or why not?

[...] Customer Service? June 2, 2009, 2:28 pm Filed under: Uncategorized (My Original Blog Post: http://howtomakeiphoneapps.com/2009/06/at-99-a-pop-can-you-afford-sparkling-customer-service/) Many software developers take pride in being able to over-deliver on customer service. In fact, [...]

[...] Customer Service? June 2, 2009, 2:30 pm Filed under: Uncategorized (My Original Blog Post: http://howtomakeiphoneapps.com/2009/06/at-99-a-pop-can-you-afford-sparkling-customer-service/) Many software developers take pride in being able to over-deliver on customer service. In fact, [...]

At $.99 a Pop Can You Afford Sparkling Customer Service?…

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If you’re getting so many complaints that it’s costing more to support an app than to sell it, then there may be something seriously wrong with the app or the way it’s presented (setting potential users’ expectations). I think most iPhone app “complainers” simply one-star you on the way out.

Any customer email that requires a considered reply most likely contains intelligence data (bug reports, feature requests, customer perceptions, etc.) that should help you improve the app. On balance, I find such data to be worth the time/effort of the reply. I learn nothing from the one-star-upon-delete folks.

@dannyg – that is a good point. It is true that a lot of customer feedback can be used to actually improve the product. My first app did benefit from this type of feedback. It was released a bit too early (lesson learned) but the sometimes painful feedback did improve the product in the end.

This is an issue we ran into almost immediately with our apps. The worst part was receiving bug reports or complaints that were misunderstandings in the form of App Store reviews. We built a service called Tap4Help (http://www.tap4help.com) in order to facilitate better two-way communication with our users. We have found that using Tap4Help to build a native FAQ section into our apps that can be updated as issues are discovered and to generate structured support requests that contain OS and application version information has helped a lot in being able to keep customer support and “alternate” issue reports manageable.

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