There’s been a lot of coverage recently for some of the comments about improvements to the Android Marketplace that Eric Chu made at the Inside Social Apps conference. One of the big holes I see right now is the affiliate program. In the list of intended improvements I haven’t seen mention of an affiliate system yet. Apple has been running an affiliate program for iTunes since before there was an app store. The affiliate program pays a small percentage of the purchase cost to a third party who acts as the recommendation/referral agent.
I have no idea what the overall numbers look like in terms of bottom line for Apple, but I do know the effect than an affiliate program has on developers and media properties. Unwrap the download URLs from sites like 148apps and there’s an affiliate program link sitting in the middle. We made use of the affiliate links at Chomp and another startup effort I worked on before that. What an affiliate program says to developers and site owners is “we care about you helping us promote the good stuff in our store.” I think it’s really greased the wheels for Apple and encouraged quality third party services.
If Google would like to increase the download of paid applications (and when the time comes also start to ramp up in-app purchases) without having to spend all the time and effort directly on revamping the marketplace they should take a look at spinning up an affiliate program. The advertising model works, sure. But the incentives are better aligned to drive the overall health of the system when a publisher is paid on app download and not on ad impression or click.