Back in November 2017, Amazon introduced Alexa in-skill purchase as another way for developers to monetize. The feature, which has stayed in preview in the past, has officially become available to all Alexa skill developers.
In the mobile app market, paid apps require payment before consumers have the chance to use them. However, Amazon considers user experience to be more important than monetization.
In the Alexa skill store, skills with subscription plans need to have certain free services. Users will pay only after they have tested the skills and feel like to attain the premium service. For instance, voice-based games can charge for additional packs, while podcast services can provide exclusive content every week.
TuneIn Live, for example, allows users to listen for seven days for free using Alexa. If users want to continue, they’ll be charged US$3.99 monthly. It’s different from the TuneIn Premium, which costs US$10 and allows subscribers to listen on phones, tablets and PCs.
Developers are in control of what content to offer as premium and at what price. But Amazon handles the purchasing flow via Amazon Pay for Alexa Skills. Amazon also offers self-serve tools for developers to manage their in-skill purchases and optimize sales.
Amazon Prime members will receive the best deals from Alexa in-skill purchases. Although every Alexa device user can purchase for premium content in Alexa, Amazon wants to ensure that its Prime members are treated better. For instance, Prime members can save US$1 from the TuneIn Live subscription plan, or 20 percent off when they purchase a Wicked Witch pack from gaming skill “Yes Sire’s.”
The purpose is to make Prime members feel that they are getting the best value out of their membership annual fee from everything Amazon offers.
Developers are paid 70% of the listed price for the in-skill purchase. Discounts for Prime members will be absorbed by Amazon. It won’t affect the developers.
In addition to the new in-skill purchase, Amazon has two other ways to pay its Alexa skill developers. Firstly, brands and merchants can sell products and tickets directly through Alexa. The purchase process will be completed via voices and existing payment methods which Amazon users store in their accounts.
Amazon is also rewarding developers directly with cash through the Develop Rewards program, awarding most popular and engaging Alexa skills across categories. According to the company, it paid out millions of dollars to award developers in the first year.
According to Amazon’s latest announcement, there are 40,000 Alexa skills now on the platform, up from 25,000 in the past December.
Amazon has introduced various ways for developers to monetize with their Alexa skills. However, how Amazon can highlight each skill and how users can easily locate it among some 40,000 skills in the store could be the next challenge for Amazon.