Category Archives: marketing

Marketing for microISVS

Below are the video and slides of the “Marketing for microISVS – embracing the ‘dark side’?” talk I gave at ESWC 2009 in Berlin. This is a high-speed ramble through a vast subject. In the 45 minutes available I do my best to dispel some of the myths software developers have about marketing and discuss some marketing concepts, including: branding; positioning; pricing; and segmentation. Taking in Harley Davidsons, tinned tomatoes, Coca Cola and food blenders on the way. The first couple of minutes, where I dispel the myth that good software sells itself without marketing, are missing from the video due to a dead camera battery. But you knew that anyway, so I don’t think this detracts much overall.

Video:

Slides (which might not make much sense without the video):

NB/ When I said 47Signals, I meant 37Signals (brand inflation?). Thanks to Tarek for the correction.

Links to some of the things mentioned in the talk:

A big thank you to Alwin and Sytske of collectorz.com for hot-footing it from Alwin’s talk to do the video (you can see Alwin’s excellent talk on web app pros and cons here). And also to David and Panagiota for all the hard work that goes on behind the scenes organizing ESWC.

If you found this talk useful you might also like 10 mistakes microISVS make.

microISV reading list

I have added a microISV reading list page to this blog. Please feel free to add your own comments to the page on the books listed or any other books you feel are relevant.

Off to ESWC 2009

marketing for microisvsI will be off to ESWC 2009 in Berlin in a few days. I am doing a talk “Marketing for microISVs – embracing the dark side?” on the Saturday morning. It is going to be tough to tackle as huge a subject as marketing in 45 minutes including questions, but I like a challenge!

I am also looking forwarding to touching base with old acquaintances and meeting some new people. If you are going to there, do come and say hello.

Apple resort to FUD marketing

Apple have resorted to ugly FUD marketing in their latest ad. This seems a bit rich given that Mac OS X 10.6 has a bug that can delete all your user data.

The art, science and ethics of software box shots

Perfect Table planI have recently revamped the PerfectTablePlan payment pages. I asked Andrew Gibson of 3d-box-shot.com to create an image of the PerfectTablePlan packaging, using the existing artwork. I was very impressed with the result. The image is much cleaner and more aesthetically pleasing than I could have achieved by photographing the physical packaging. But I am much less keen on the practice of using box shots of software where is no box (i.e. download only). It seems disingenuous, at best.  Andrew kindly agreed to write a guest article for this blog with an insider’s view on the art, science and ethics of software box shots.

Almost every time the subject of box shots is raised in any sort of software marketing forum, opinion seems to split diametrically in two opposing camps. The first group don’t see any ethical problem with displaying a box shot for a “download only” product. The typical argument used in favour of box shots is that it makes a product appear more tangible to consumers. They can see what you’re selling without having to read about it. It removes any doubt that the site they are looking at has software to sell and, when used effectively, can add an air of professionalism to a site. Finally, there’s a widely held belief that because of this, displaying a box shot can improve conversion rates.

In contrast, the opposing group believe that displaying a box shot for a “download only” product is ethically wrong and fundamentally dishonest. They maintain that customers would complain about not receiving a physical package in the post that’s identical in every respect to the “bogus” box shot displayed on the website. I run my own Micro ISV, selling amongst other applications, a product called 3D Box Shot. As a result, you might be inclined to think that I fall into the first camp. However, I’m actually quite ambivalent about the issue. I use box shots on some of my sites and have never received a single complaint from a customer about them not receiving a physical product in the mail. However, consumers in different markets don’t all behave the same way, which is why advice that works for some ISV’s can be commercial suicide for others. I’m entirely willing to accept that in some markets, some customers may indeed complain about not receiving a physical product. I just haven’t experienced this first-hand.

It’s worth noting that existing users of your product can often be persuaded to purchase additional copies to give as gifts. They may not even make this connection themselves, so why not put the thought in their heads? Send a festive email offering to ship additional physical copies of your products (gift wrapped) to friends and relatives. Add something like the following to your site to make the point visually:

selling-software-as-a-gift

click for a larger image

It’s often stated that adding a box shot to your site can dramatically improve conversion rates for your products. It may come as a surprise to learn that I’m not convinced that this is true in all cases. Generally speaking a box shot isn’t some sort of magic bullet that will transform your sales overnight. However, if it is an integrated part of your marketing strategy then it can make a real difference.

So how do you go about integrating a box shot into your marketing strategy? From a design perspective you can integrate a box design by keeping everything visually consistent. Use your company and product logo on the box and clearly display your website URL as well. This will help to increase the marketing potential of your box shot.

One less obvious method is to add you box shot to the image for your PAD Screenshot. Most download sites are worse than useless when it comes to driving traffic to your site. So instead of thinking of the screenshot referenced in your PAD file as just a screenshot, think of it as a blank advertising canvass that thousand of download sites are happy to display for you free of charge…

PAD-Screenshot-replacement

click for a larger image

Using this method, you can attract visitors to your site even from low quality download sites that don’t even supply a link back to your website.

So how do you get a box shot designed? As a designer I have a fairly unique approach to software box design. I treat a design as a conceptual puzzle than needs to be solved in order to create an effective cover. The criteria I use are simple. Someone needs to be able to look at the box shot and immediately understand what the product is and does. If a box doesn’t meet this challenge, then it isn’t doing it’s job. It’s normally possible to create an effective visual metaphor for a product that explains visually what it’s all about. Here are some examples of the sort of designs I’m talking about:

Example-Designs

click for a larger image

Trends in box design can change. Not so long ago lots of people were asking for Windows Vista Style boxes, but as it became more apparent that Windows Vista was destined to be seen in the same light as Windows ME, this requirement has tailed off. Nowadays the vast majority of design jobs that I do are for DVD cases, both virtual box shots and full print insert designs.

If you’re artistically talented and have access to a good quality image editing tool like Adobe Photoshop and have an easy means of transforming your 2D designs into a 3D Box, then you may well be able to create an effective looking box shot yourself.  However, once you consider the time this takes, hiring a designer seems a lot more reasonable. Since I design boxes commercially, I’ve acquired a lot of design resources including hundreds of royalty free vector images and a library of stock photography. I can draw on these resources when I’m creating a box design. This lets me develop designs quickly through the draft stage through towards the final design. However, as an experience box designer, I still find it challenging and rewarding work. But it is very time consuming.

If you’re determined to “do it yourself” then bear the following points in mind:

  1. The box shot needs to visually show what your product is and does. Show your design to someone that’s never seen your product and ask them to tell you what your product does. If they can’t do this, then your design isn’t up to the job.
  2. Make sure your website address is clearly visible on the box shot. If you ship a physical package you’ll have no way of controlling where it ends up. The box itself can drive traffic to your website. You don’t have to slap it on the front of the box, just make sure it’s there and can be seen.
  3. Try to design a cover that fits with the look and feel of your website. Use the same (or at least, non conflicting) colour scheme as your site and try to use the same fonts. This will prevent your box shot from standing out on your site like a sore thumb.
  4. Never use more than three different fonts in your design. Unless you are selling a font management application, this is sure way to spoil any design.
  5. Design so that text is still visible when the box is reduced to a 250 x 250 thumbnail. If the text is legible at this size on your design, then unless the design carries the message all by itself, the box won’t work very well as a marketing tool.
Perfect-Tableplan white background

click for a larger image

The image above was created in a rendering application at very high resolution. It took around 6 hours to complete on a dual core system. The resulting image is big enough to be used in print ads, or can easily be resized for use on the web.

Andrew Gibson is the head developer and lead designer for www.3d-box-shot.com, provider of box shots, packaging design, e-book covers and more. Box shot images from scratch start at $100. Box shots images from existing artwork can be created for as little as $25. All the images in this article were created by them. The original PerfectTablePlan packaging was designed by Nicola and Adrian Metcalfe.

Ten mistakes microISVs make

Here is a video of the “Ten mistakes microISVs make” talk I gave at the Software Industry Conference 2009 in Boston. Total duration: 27 minutes.

The slides aren’t terribly easy to read, due to the resizing and compression of the video. But you can also download the paper and slides:

A big thank you to Alwin and Sytske of collectorz.com for doing the video. You can read Alwin’s excellent software marketing blog at alwinhoogerdijk.com.

Feel free to embed this video, as long as you include a credit and a link back to this blog.

How many of these mistakes have you made? How many are you still making?

A test of Cost Per Action (CPA) vs Cost Per Click (CPC) in Google Adwords

CPA vs CPCThe traditional approach to Google Adwords is to set a bid price for each keyword. This is known as Cost Per Click (CPC). Google then then uses the bid prices in conjunction with a secret formula (the quality score) to decide how high to rank your ad in the Adwords results. If you bid more, your ad will appear higher and typically get more clicks, but your cost per click will increase. So setting an optimal bid price is important. Bid too little and you won’t rank high enough to get a decent number of clickthroughs. Bid too much and you will potentially end paying more to Google than you recoup in sales.

An alternative approach is to tell Google Adwords how much you are prepared to pay for a particular action, e.g. a sign-up, download or sale. This is known as Cost Per Action (CPA) or Conversion Optimizer. Google will then automatically calculate your bid prices and attempt not to exceed the CPA you set (although this isn’t guaranteed).

CPA sounds great. I can stay in bed a bit longer while the mighty Google brain does the bid tweaking for me. Unfortunately I wasn’t able to use CPA. I  count sales as conversions (not downloads) and I have my adwords account split into a number of campaigns by geographic region and by type (e.g. search vs content). Having my campaigns structured like this, rather than one monolithic campaign, makes for more flexibility (e.g. different ads, phrases and bid prices for different geographical areas) and more useful reports (e.g. separate reports for search and content). But it also meant none of my Adwords campaigns made the minimum threshold for conversions per month.

When Google dropped the minimum threshold for CPA to 30 conversions per campaign per month, one of my Perfect Table Plan search campaigns became eligible. So I did an experiment. I ran a campaign for 4 weeks using CPC, then 9 weeks using CPA, then another 4 weeks using CPC. I set the CPA bid to roughly the average cost per conversion I got for CPC. I was curious to see if Google would find sweet spots that I had been missing or whether they would bid as high as they could to take as much money off me as possible. Summary: CPC outperformed CPA on all key metrics, including: 4.4% higher conversions, 9.4% lower cost per conversions and 8.0% higher profit.

The detailed results are as follows:

metric CPC  (vs CPA)
impressions/day +13.9%
clicks/day +1.3%
conversions/day +4.4%
CTR -11.1%
conv rate +3.1%
income/day +4.4%
cost/day -5.5%
CPC -6.6%
profit/day +8.0%
PKI -5.2%
ROI +10.4%
cost per conversion -9.4%

In graphical form (click to enlarge):

CPA vs CPC graph 50pc

Notes:

  • The values given are taken by computing (CPC metric – CPA metric)/(CPA metric). E.g. ROI of +10.4% means that CPC had a 10.4% higher ROI than CPA.
  • Only a single (geographically based) search campaign was measured. The total number of conversions during the time period of the test was in 3 figures.
  • I only measured sale conversions. This gives me less data than measuring downloads, but I think it is unsafe to assume the number of downloads correlates closely to the number of sales.
  • The PerfectTablePlan sale price is £19.95/$29.95. To calculate profit I only counted 75% of the price of a sale (the other 25% was assumed to cover the cost of support, ecommerce fees and other overheads associated with the sale).
  • Each of the time periods was a multiple of 7 days to avoid any issues with different results on different days of the week.
  • I ran CPC for an equal amount of time either side of the CPA test to try to balance out any seasonal factors.
  • Google conversion tracking uses Cookies and is therefore not 100% accurate.
  • PKI is Profit Per Thousand Impressions.
  • ROI is Return On Investment.

It wouldn’t be wise to draw any sweeping conclusions from one test with a limited amount of data. However I believe the results show:

  • A CPA campaign running for 9 weeks wasn’t able to outperform a mature CPC campaign. The CPC campaign had been running for over 4 years, but one would have thought CPA would have been able to use that pre-existing  data. CPA might have performed better if given longer. It would probably also have done better against a less mature CPC campaign.
  • Google didn’t rob me blind using CPA bidding. The CPA cost per day was only 5.5% higher.
  • The results weren’t hugely different. On the basis of the above results one might still conclude that CPA is superior to CPC as it requires less time to manage.

Lazy instantiation marketing

lazy instantiationIt is often hard to know what sort of additional services customers will be interested in. Might they be interested in:

  • a yearly subscription instead of a one-off payment?
  • hosting their own server?
  • paying extra for 24 hour support?
  • a port of your product to Mac OS X?

You can implement the new service and then offer it to customers. But this can be a huge waste of time and money if it turns out nobody wants it. An alternative approach is to borrow the idea of “Lazy instantiation” from programming (also called RAII – Resource Acquisition Is Initialization).

Programs need to initialise various system resources, such as databases, files and hardware devices. It is generally considered good practice to only initialise these resources as they are needed. This is called “lazy instantiation” and results in faster start-up times and no wasteful initialisation of resources that turn out not to be needed. For example in C++ (glossing over various details of cost, smart pointers, copy constructors, error handling etc to keep the example code simple):

lazy_instantiation

So we can only access the resource by calling MyClass:getResource(), it will get initialised on first use and it will be cleaned up when MyClass goes out of scope. This much more elegant, efficient and less error prone than always initialising the resource at start-up or adding lots of checks throughout the code to see if the resource is already initialised.

A similar approach can be applied to marketing. For example, instead of spending days sorting out the intricacies of subscription payments, you just add the following to your purchase page:

Please email support@acme.com if you are interested in purchasing an annual subscription instead of making a one-off payment.

This will take you a few minutes. If someone emails you that they would prefer a subscription you reply along the lines of:

Thank you for your interest in purchasing Acme server via an annual subscription. We are currently assessing the commercial viability of a subscription approach. We will contact you if and when we decide to make Acme server available through annual subscription. But, for now, you can only purchase Acme server through a one-off payment, as detailed on our purchase page. … etc

If you get enough interest you go ahead and do the work to implement subscription payments. If you don’t – well, you didn’t waste much time on it.

MyClass::MyClass()
{
   myResource = NULL;
}

What are they smoking in Redmond?

I scanned the Microsoft ad below from a recent QBS catalogue.

microsoft_ad

click for larger image

I am still struggling to understand the underlying message. Use Team System and Microsoft will get its tentacles around you? I don’t know which is more unlikely, the basketball playing Cthonians or the athletic and good looking development team.