How to Monetize Your Alexa Skill

It is no question that the Amazon Echo, Dot or Tap were the huge hits of the holiday season.  With an estimated 5 million devices already out there, many companies are looking at how to earn revenue on this platform. Which means that developers are looking at how to make money with their Alexa Skills. 

Background

Skills are to Alexa what Apps are to mobile phones.  They are a way to extend the platform by a third party developer to add features that the original manufacture could never have thought of.

It is fairly straightforward to get a developer account and a free AWS account to host your skill with Amazon (although you can host them anywhere, but there are reasons to use their service).  The free AWS account that Amazon provides has some limits as to how much traffic the free account will support and how long it will last.  AWS works by letting third party developers buy computing power in the cloud which will then power their skill.

If a skill is extremely popular, it will get used a lot, and cost more to service. This means that the free account may at some point require paying usage fees.  This is fine, as it is all a business.  However, there has to be a way for the third party developer to make money!  Even on mobile App stores (i.e. Apple and Android) there is no fee for listing free mobile Apps (although there are fees to be a part of their developer programs).  

This seems like something that will have to change.  As skills 'grow up" and become both more useful and more powerful, Amazon will have to allow for purchase of skills.  Amazon is already capable of this as they already run the popular AppStore for Android which is primarily for FireTV and Fire Tablet devices, but can be installed on most any Android phone. 

Clearly a developer should be compensated for the work and effort that is required to create a skill, just like they are on other computing platforms.

So, until we are at the point where Amazon allows charging for skills (this does not come from any inside information from Amazon) there are a couple of ways still, to monetize a skill.  Let's review them.

Two Ways Right Now

Write a skill to support a product you are already selling.  The idea is that by adding voice control, the appeal of your product becomes more valuable.   Your customers who already have an Echo can now control your device with it.  This is a win/win situation for everyone involved.  We see this happening with all the home automation devices that are coming out. Of course, this requires that you have a physical product to sell.

The other way is to incorporate your own payment processor into the skill, so that when the user enables and links it to their account, they will have a chance to pay for it.  This still puts the work on the side of the third party developer, because the developer must handle payments, as well as write the code to take payments and store payment information.  This is not necessarily trivial, although it can be done.  PayPal is one way to accomplish this. 

The Future

I believe Amazon will allow charging for a skill.  They are waiting for the 'right time' which is a point when they believe customers will pay extra for skills, which is likely at the point that skills can do more, which will happen as the platform matures.  

Do you have any ideas for making money with skills?  Leave a comment below.

 

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