Last week Amazon announced that they will soon be introducing a digital currency: Amazon Coins. While other digital platforms like Facebook have marginalised or abandoned their digital currencies, Amazon Coins has been designed in such a way that it will undoubtedly boost digital sales and make the Amazon Appstore a better place for consumers, developers and ultimately, Amazon itself.
In terms of function, Amazon Coins will be much like any other digital currency when they are launched in May. In a press release, Amazon explained that the currency can only be used to make purchases in the Amazon Appstore or in-app purchases from apps bought from there.
“For customers, it’s an easy way to spend money on Kindle Fire apps and games. They’ll be able to purchase as they do now, but with the ability to choose to pay with a credit card or using Coins.”
Most digital giants like Facebook have experimented with using a digital currency at some point, or at least the idea of having one. This has principally been done to standardise the payment experience for customers to make it easy and accessible for them, rather than letting every app developer come up with their own way of charging for purchases.
Where Amazon Coins differs from other digital currencies is not in its basic function, but in the way Amazon want to use it to improve the financial health of their AppStore. Amazon have already announced that they plan to give away “tens of millions of dollars’ worth of Coins to customers to spend on Kindle Fire apps, games, or in-app items.” Giving away so much virtual currency in this manner has the unique ability to attract eager new customers and get them used to buying Amazon Appstore apps, making in-app purchases and so on.
Amazon hopes that this injection of ‘free cash’ into the Kindle Fire ecosystem will entice a significant number of new customers (perhaps luring some away from the Apple Store and Google Play Store where they buy apps for their iPhones and Android smartphones) who will then get used the Amazon Appstore and make it their premier app location.
In addition, Amazon Coins should drive Kindle Fire sales, especially if the company takes the opportunity to make attractive special offers by bundling together a healthy amount of Coins with new Kindle Fire hardware purchases. Amazon have been advertising for additional tech support jobs in preparation for the May release of the new currency, in order to ensure that the launch goes as smoothly as possible.
Not only are Amazon keen to get consumers onside for Amazon Coins, they also have tried to ensure that app developers will be keen to endorse it too. In their press release, Amazon highlighted just how easy it will be for developers to start offering their customers the new currency, as no modifications to their apps are required:
“To take advantage of this unique opportunity, you only need to do one thing: make sure your new apps and app updates are submitted and approved by April 25th so they’ll have the best chance of being available for Coins purchases at the launch of the program (and when we give customers their free Coins).”