5 ms·

I appreciate the developers' honesty, but if the goal is to justify the price to customers, they shouldn't blame external costs and delivery challenges (e.g. Ap

I appreciate the developers' honesty, but if the goal is to justify the price to customers, they shouldn't blame external costs and delivery challenges (e.g. Apple's take from App Store sales). Think of it this way: while asking your boss for a raise, you wouldn't mention the cost of rent or your other bills — even if those are prime motivators. You would instead focus on how you bring value to the company. Several of the article's points focus on the value that this app brings to customers. The post would be stronger if all of the points had that tone.

danielweber 12y ago
I've known a number of people who have successfully gotten raises by talking about their personal expenses. It's not a rational appeal, it's an emotional appeal, but emotional appeals can and do work. Rationally your labor has a market value. How you negotiate your way into getting paid that (or a little over that) is up to you.
- ekianjo 12y ago
  > I've known a number of people who have successfully gotten raises by talking about their personal expenses. Like that photographer dude on HN a while ago who defined the cost of one photograph by the equipment cost, and the plane ticket required to go there? With this kind of logic, you should bill your customers your years of education, from the time you started to read, and effectively charge them millions of dollars per product. This is so ridiculous I don't even know if there's a name for this kind of fallacy.
  - hyperpape 12y ago
    Fallacy, or just an application of supply and demand? In general, requiring many years of education reduces the supply of a given profession, which raises salaries (though demand still helps explain why doctors make more than philosophy professors).
    - ekianjo 12y ago
      What matters is not the supply of a given profession, it's its market value or utility value (for the said market - you define it as demand). The market has not much use for philosophy professors, that's precisely why they don't make much money. Rarity is never a single factor for value definition. If it were that simple, you could just tell your kids "study what nobody else is studying and you'll do just fine".
      - hyperpape 12y ago
        Hence supply and demand. But what you're describing ignores supply, and that's wrong. If you doubled the supply of doctors (or concretely made things that doctors do be doable by nurses), you would get lower prices, as they competed for business. Sometimes the restrictions on supply are artificial, sometimes they are natural. Medicine are a good example of both effects. Being a doctor is hard, and requires a lot of education. But there are also limitations on how nurses and other medical practicioners can work (dental hygienists can't clean your teeth unless they are supervised by a dentist).
  - w0utert 12y ago
    >> With this kind of logic, you should bill your customers your years of education, from the time you started to read, and effectively charge them millions of dollars per product. This is so ridiculous I don't even know if there's a name for this kind of fallacy. I think the fallacy here is that you extrapolate the things you mention to 'millions of dollars per product'. I don't think its ridiculous logic to attach a premium to your 'market value' based on how much (time, money) you invested in your education or side projects, and I also don't think it's ridiculous at all to account for equipment cost and travel expenses to determine the cost of (for instance) a photograph. In fact, I think it's perfectly normal, and I assume the similar logic was used in determining the price of about every product or service I buy. Usually costs like these are amortized over a large range of products ('photos', to stay with your example) and/or a large number of sales, so the numbers don't add up to 'millions of dollars per product'.
    - ekianjo 12y ago
      > I also don't think it's ridiculous at all to account for equipment cost and travel expenses to determine the cost of (for instance) a photograph It is ridiculous, because your equipment is not disposable, and is going to serve for multiple pictures (possibly hundred of thousands before it dies out) and your trip was not just for that particular picture, but for other purposes as well (relaxing, tourism, etc...). It seems very far fetched to justify the price of a single photograph this way.
      - xionon 12y ago
        I don't believe anyone is suggesting that you charge the full price of the camera for every photo, but rather that it's a factor in determining the correct price for a single photo. Also, if someone wanted me to fly somewhere to do a project for them, I am absolutely going to charge them for the plane tickets. Travel is difficult and costly, there's not only the cost of the ticket itself but the opportunity cost of all the things you could be doing instead of dealing with flying somewhere.
        ekianjo 12y ago
  - pjmlp 12y ago
    Why do you think university degrees get paid better than learning at home kind of thing? Of course the investment in certain skills needs to be paid. It is easier to understand why software is "expensive" when one factors in all monthly costs involved in paying bills, office personal, developers, sales and marketing to produce the said software.
    - ekianjo 12y ago
      > Investment in certain skills I think you get it wrong. You are not being paid for the years of studies you did. If you learn about petrol extraction in a country that has no oil and if you are not willing to move, your market value is exactly zero. The market defines your value, not your education. That's precisely what tons of students don't understand and get severely pissed off when they don't get the job and the salary they expected.
      - coldtea 12y ago
        >I think you get it wrong. You are not being paid for the years of studies you did. Not only you do, but in a lot of countries it is mandatory too. People with university degrees earn X more than people without, by law. This for example happens with civil servants in lots of countries (different, published pay scales if you have a university degree). In some places it's also encoded in the minimum wage a profession commands. (I worked at the salary department of a major ministry in my country, and I know of similar laws elsewhere too).
        ekianjo 12y ago
        > Not only you do, but in a lot of countries it is mandatory too. Great, you just defined one of the root causes of unemployment. Artificially fixed value. The same thing occurs when you artificially define minimum wages: home owners stop renting their properties because it does not make sense for them anymore.
        coldtea 12y ago
        I don't believe in some magic "market equillibrium mechanism" that always reaches some optimum and doesn't need intervention. If people and especially employees, can screw other people, they will. Laws against slave and child labor, and women inequality in pay, are also some ways in which we introduced protections against those abubses. For some people those protections were "artificially defined" too (e.g "why take the children out of the labour pool and artificially inflate the value of adult labor"). >The same thing occurs when you artificially define minimum wages: home owners stop renting their properties because it does not make sense for them anymore. The correlation doesn't make much sense. As long as there are people willing to rent their properties, they'd rent them. If anything, with people getting some guaranteed minimum wage, instead of being paid less, there even be more people that can afford to rent. Or is the idea here that people would not be employed because of the strict miminum wage? In actual life I haven't seen that. It's more like employees are paying people less just because they can, than paying them less because they cannot afford to pay them more. Minimum wage at least puts a cap to that.
  - luch 12y ago
    Picasso did this once : one day he was relaxing at a park, a woman recognized him at asked him to draw her portrait. Picasso quickly scribbled something and before giving back the drawing, told the woman : "It will be 300$, madam." "That's way too much", the woman replied, "it took you only 10 minutes to do it !" "That's where you are wrong madam, it took me all my life."
  - coldtea 12y ago
    >With this kind of logic, you should bill your customers your years of education, from the time you started to read, and effectively charge them millions of dollars per product. This is so ridiculous I don't even know if there's a name for this kind of fallacy. Of course you should factor in your education et al into the price you charge for your product. Fallacy? That's what every professional I know does. He factors in his qualifications (education etc), into the prices he charges.
- bachmeier 12y ago
  > I've known a number of people who have successfully gotten raises by talking about their personal expenses. That can in some cases be a winning strategy for negotiating a raise. If your living expenses are too high relative to your salary and you're worth more than your current pay, your boss might give you a raise out of fear you'll leave. That logic doesn't carry over to app pricing though.
- dspillett 12y ago
  > It's not a rational appeal, it's an emotional appeal, but emotional appeals can and do work. This isn't as much an emotional appeal ("please sir, can I have some more? Look as the way I'll have to live if I can't.") but more of an illustration of why more is desired and therefore why you might be considering looking elsewhere (which if you word it right won't be taken as a threat by a reasonable boss and/or HR person, rather as an honest explanation of your needs and thought process).
- mstolpm 12y ago
  For an emotional appeal to be successful, there needs to be a strong relationship (business, private, social) between the partys involved. Otherwise it will often be considered whining or begging. Having no relationship with a particular app developer, I'm not interested in his cost structure or the time it took to develop the app but only in the value the app has for me. (That's not to say an app couldn't be worth 100 bucks or even much more.)
  - bradleyland 12y ago
    > For an emotional appeal to be successful, there needs to be a strong relationship (business, private, social) between the partys involved. An "emotional appeal" is also known as an appeal to empathy, and humans empathize for many reasons other than personal relationships. When you hear about starving children in some far away place, you empathize, not because you know the suffering children, but because we're hard wired to protect our young. Other times, we empathize because we can identify with another person's experience. HttpWatch is a tool for developers, made by developers. Their hope with this message is that other developers will identify with their challenges. Every developer who sells their software in the app store has struggled with the pricing question. The addition of empirical evidence to support their pricing was a nice touch. There's always a skeptical subset of people who will not respond to any appeal. In my experience, that group is overrepresented here on HN, so I'm not surprised at the responses, but my hunch is that this message will have some positive effect for HttpWatch.
Igglyboo 12y ago
Actually I think cost of living increases and inflation are fine to bring up when asking for a raise. If you don't get a raise to match inflation they are effectively paying you less than last year, which only makes sense if your job performance is worse as well.
- joshyeager 12y ago
  If you have numbers to back up your COL increase or inflation, then this could work. But if you don't have reliable numbers (or if your boss just doesn't trust them), this technique will probably fail.
- reeses 12y ago
  This works out when discussed in the context of "competitive compensation" in your market. While your manager may not care that you want to live in a USD5,000/mo apartment, she may care that companies x, y, and z are paying programmer analyst IIIs USD5k/mo more than she's paying you. I almost never give COLA raises, but I will raise based on performance and desire to remove money as a reason to look for another job. It's the easiest way to overcome inside recruiting and it doesn't take much thought, so I can spend my time with other retention techniques.
- euroclydon 12y ago
  Would you give money back when the cost of fuel or food goes down?
jburwell 12y ago
Most companies with different geographic locations adjust their pay scales based on the local cost of living. Consider a company with offices with New York, NY and Charolette, NC (e.g. Bank of America) -- the cost of living in those locations is radically different. If they attempted to pay Charolette, NC wages in the NYC literally no one would work for them. Another example, the US government [1] has a base pay scale with a cost of living adjustment. I think they make some very strong points (30% to Apple, no upgrade prices, etc) for their price, and I genuinely surprised that we don't see more $100+ apps in the Apple App Store. [1]: http://www.opm.gov/policy-data-oversight/pay-leave/salaries-wages/2014/general-schedule/ http://www.opm.gov/policy-data-oversight/pay-leave/salaries-...
smackfu 12y ago
I agree that the Apple fee is a cost of doing business, just like website design or credit card processing. And it's a known quantity for anyone who decides to make an iOS app.
deleted 12y ago
[deleted]
jrs235 12y ago
$100! That expense should be fairly easy to justify (to a business/boss that is profitable). "Boss, you pay me $50 an hour, it would take me 8 hours to get the functionality this app provides (that we need) and that's not including future changes and improvements. So, what should we spend? $100 for this app or $400+ for an internal pet project that's likely to turn into a time and money sink?"
- jrs235 12y ago
  If you wanted, you could also step away from costs of $50/hr and talk about the value of a developer hour (say $100/hr).
ChuckMcM 12y ago
Sorry but I disagree, the fact that Apple is taking 30% off the table is completely relevant to the price charged. They are saying, in effect, we need to get $70 from this App to cover our costs, since Apple is going to take 30% we have to set the price at $100 to get $70. As a "boss" I do get employees who point out that their cost of commuting is significant. There is a distance vs location vs salary metric that people are constantly min-maxing to improve their net take home pay. If I hire a web developer that can work 5 minutes from home by bike, or an hour from home by car at my place, that it going to figure into the salary that they require to take the job.

danielweber 12y ago

I've known a number of people who have successfully gotten raises by talking about their personal expenses. It's not a rational appeal, it's an emotional appeal, but emotional appeals can and do work. Rationally your labor has a market value. How you negotiate your way into getting paid that (or a little over that) is up to you.

ekianjo 12y ago
> I've known a number of people who have successfully gotten raises by talking about their personal expenses. Like that photographer dude on HN a while ago who defined the cost of one photograph by the equipment cost, and the plane ticket required to go there? With this kind of logic, you should bill your customers your years of education, from the time you started to read, and effectively charge them millions of dollars per product. This is so ridiculous I don't even know if there's a name for this kind of fallacy.
- hyperpape 12y ago
  Fallacy, or just an application of supply and demand? In general, requiring many years of education reduces the supply of a given profession, which raises salaries (though demand still helps explain why doctors make more than philosophy professors).
  - ekianjo 12y ago
    What matters is not the supply of a given profession, it's its market value or utility value (for the said market - you define it as demand). The market has not much use for philosophy professors, that's precisely why they don't make much money. Rarity is never a single factor for value definition. If it were that simple, you could just tell your kids "study what nobody else is studying and you'll do just fine".
    - hyperpape 12y ago
      Hence supply and demand. But what you're describing ignores supply, and that's wrong. If you doubled the supply of doctors (or concretely made things that doctors do be doable by nurses), you would get lower prices, as they competed for business. Sometimes the restrictions on supply are artificial, sometimes they are natural. Medicine are a good example of both effects. Being a doctor is hard, and requires a lot of education. But there are also limitations on how nurses and other medical practicioners can work (dental hygienists can't clean your teeth unless they are supervised by a dentist).
- w0utert 12y ago
  >> With this kind of logic, you should bill your customers your years of education, from the time you started to read, and effectively charge them millions of dollars per product. This is so ridiculous I don't even know if there's a name for this kind of fallacy. I think the fallacy here is that you extrapolate the things you mention to 'millions of dollars per product'. I don't think its ridiculous logic to attach a premium to your 'market value' based on how much (time, money) you invested in your education or side projects, and I also don't think it's ridiculous at all to account for equipment cost and travel expenses to determine the cost of (for instance) a photograph. In fact, I think it's perfectly normal, and I assume the similar logic was used in determining the price of about every product or service I buy. Usually costs like these are amortized over a large range of products ('photos', to stay with your example) and/or a large number of sales, so the numbers don't add up to 'millions of dollars per product'.
  - ekianjo 12y ago
    > I also don't think it's ridiculous at all to account for equipment cost and travel expenses to determine the cost of (for instance) a photograph It is ridiculous, because your equipment is not disposable, and is going to serve for multiple pictures (possibly hundred of thousands before it dies out) and your trip was not just for that particular picture, but for other purposes as well (relaxing, tourism, etc...). It seems very far fetched to justify the price of a single photograph this way.
    - xionon 12y ago
      I don't believe anyone is suggesting that you charge the full price of the camera for every photo, but rather that it's a factor in determining the correct price for a single photo. Also, if someone wanted me to fly somewhere to do a project for them, I am absolutely going to charge them for the plane tickets. Travel is difficult and costly, there's not only the cost of the ticket itself but the opportunity cost of all the things you could be doing instead of dealing with flying somewhere.
      - ekianjo 12y ago
- pjmlp 12y ago
  Why do you think university degrees get paid better than learning at home kind of thing? Of course the investment in certain skills needs to be paid. It is easier to understand why software is "expensive" when one factors in all monthly costs involved in paying bills, office personal, developers, sales and marketing to produce the said software.
  - ekianjo 12y ago
    > Investment in certain skills I think you get it wrong. You are not being paid for the years of studies you did. If you learn about petrol extraction in a country that has no oil and if you are not willing to move, your market value is exactly zero. The market defines your value, not your education. That's precisely what tons of students don't understand and get severely pissed off when they don't get the job and the salary they expected.
    - coldtea 12y ago
      >I think you get it wrong. You are not being paid for the years of studies you did. Not only you do, but in a lot of countries it is mandatory too. People with university degrees earn X more than people without, by law. This for example happens with civil servants in lots of countries (different, published pay scales if you have a university degree). In some places it's also encoded in the minimum wage a profession commands. (I worked at the salary department of a major ministry in my country, and I know of similar laws elsewhere too).
      - ekianjo 12y ago
        > Not only you do, but in a lot of countries it is mandatory too. Great, you just defined one of the root causes of unemployment. Artificially fixed value. The same thing occurs when you artificially define minimum wages: home owners stop renting their properties because it does not make sense for them anymore.
        coldtea 12y ago
        I don't believe in some magic "market equillibrium mechanism" that always reaches some optimum and doesn't need intervention. If people and especially employees, can screw other people, they will. Laws against slave and child labor, and women inequality in pay, are also some ways in which we introduced protections against those abubses. For some people those protections were "artificially defined" too (e.g "why take the children out of the labour pool and artificially inflate the value of adult labor"). >The same thing occurs when you artificially define minimum wages: home owners stop renting their properties because it does not make sense for them anymore. The correlation doesn't make much sense. As long as there are people willing to rent their properties, they'd rent them. If anything, with people getting some guaranteed minimum wage, instead of being paid less, there even be more people that can afford to rent. Or is the idea here that people would not be employed because of the strict miminum wage? In actual life I haven't seen that. It's more like employees are paying people less just because they can, than paying them less because they cannot afford to pay them more. Minimum wage at least puts a cap to that.
- luch 12y ago
  Picasso did this once : one day he was relaxing at a park, a woman recognized him at asked him to draw her portrait. Picasso quickly scribbled something and before giving back the drawing, told the woman : "It will be 300$, madam." "That's way too much", the woman replied, "it took you only 10 minutes to do it !" "That's where you are wrong madam, it took me all my life."
- coldtea 12y ago
  >With this kind of logic, you should bill your customers your years of education, from the time you started to read, and effectively charge them millions of dollars per product. This is so ridiculous I don't even know if there's a name for this kind of fallacy. Of course you should factor in your education et al into the price you charge for your product. Fallacy? That's what every professional I know does. He factors in his qualifications (education etc), into the prices he charges.
bachmeier 12y ago
> I've known a number of people who have successfully gotten raises by talking about their personal expenses. That can in some cases be a winning strategy for negotiating a raise. If your living expenses are too high relative to your salary and you're worth more than your current pay, your boss might give you a raise out of fear you'll leave. That logic doesn't carry over to app pricing though.
dspillett 12y ago
> It's not a rational appeal, it's an emotional appeal, but emotional appeals can and do work. This isn't as much an emotional appeal ("please sir, can I have some more? Look as the way I'll have to live if I can't.") but more of an illustration of why more is desired and therefore why you might be considering looking elsewhere (which if you word it right won't be taken as a threat by a reasonable boss and/or HR person, rather as an honest explanation of your needs and thought process).
mstolpm 12y ago
For an emotional appeal to be successful, there needs to be a strong relationship (business, private, social) between the partys involved. Otherwise it will often be considered whining or begging. Having no relationship with a particular app developer, I'm not interested in his cost structure or the time it took to develop the app but only in the value the app has for me. (That's not to say an app couldn't be worth 100 bucks or even much more.)
- bradleyland 12y ago
  > For an emotional appeal to be successful, there needs to be a strong relationship (business, private, social) between the partys involved. An "emotional appeal" is also known as an appeal to empathy, and humans empathize for many reasons other than personal relationships. When you hear about starving children in some far away place, you empathize, not because you know the suffering children, but because we're hard wired to protect our young. Other times, we empathize because we can identify with another person's experience. HttpWatch is a tool for developers, made by developers. Their hope with this message is that other developers will identify with their challenges. Every developer who sells their software in the app store has struggled with the pricing question. The addition of empirical evidence to support their pricing was a nice touch. There's always a skeptical subset of people who will not respond to any appeal. In my experience, that group is overrepresented here on HN, so I'm not surprised at the responses, but my hunch is that this message will have some positive effect for HttpWatch.

Igglyboo 12y ago

Actually I think cost of living increases and inflation are fine to bring up when asking for a raise. If you don't get a raise to match inflation they are effectively paying you less than last year, which only makes sense if your job performance is worse as well.

joshyeager 12y ago
If you have numbers to back up your COL increase or inflation, then this could work. But if you don't have reliable numbers (or if your boss just doesn't trust them), this technique will probably fail.
reeses 12y ago
This works out when discussed in the context of "competitive compensation" in your market. While your manager may not care that you want to live in a USD5,000/mo apartment, she may care that companies x, y, and z are paying programmer analyst IIIs USD5k/mo more than she's paying you. I almost never give COLA raises, but I will raise based on performance and desire to remove money as a reason to look for another job. It's the easiest way to overcome inside recruiting and it doesn't take much thought, so I can spend my time with other retention techniques.
euroclydon 12y ago
Would you give money back when the cost of fuel or food goes down?

jburwell 12y ago

Most companies with different geographic locations adjust their pay scales based on the local cost of living. Consider a company with offices with New York, NY and Charolette, NC (e.g. Bank of America) -- the cost of living in those locations is radically different. If they attempted to pay Charolette, NC wages in the NYC literally no one would work for them. Another example, the US government [1] has a base pay scale with a cost of living adjustment. I think they make some very strong points (30% to Apple, no upgrade prices, etc) for their price, and I genuinely surprised that we don't see more $100+ apps in the Apple App Store. [1]: http://www.opm.gov/policy-data-oversight/pay-leave/salaries-wages/2014/general-schedule/ http://www.opm.gov/policy-data-oversight/pay-leave/salaries-...

smackfu 12y ago

I agree that the Apple fee is a cost of doing business, just like website design or credit card processing. And it's a known quantity for anyone who decides to make an iOS app.

deleted 12y ago

[deleted]

jrs235 12y ago

$100! That expense should be fairly easy to justify (to a business/boss that is profitable). "Boss, you pay me $50 an hour, it would take me 8 hours to get the functionality this app provides (that we need) and that's not including future changes and improvements. So, what should we spend? $100 for this app or $400+ for an internal pet project that's likely to turn into a time and money sink?"

jrs235 12y ago
If you wanted, you could also step away from costs of $50/hr and talk about the value of a developer hour (say $100/hr).

ChuckMcM 12y ago

Sorry but I disagree, the fact that Apple is taking 30% off the table is completely relevant to the price charged. They are saying, in effect, we need to get $70 from this App to cover our costs, since Apple is going to take 30% we have to set the price at $100 to get $70. As a "boss" I do get employees who point out that their cost of commuting is significant. There is a distance vs location vs salary metric that people are constantly min-maxing to improve their net take home pay. If I hire a web developer that can work 5 minutes from home by bike, or an hour from home by car at my place, that it going to figure into the salary that they require to take the job.