Friday, November 28, 2014

Consumer Confidence Growing

The Consumer Electronics Association (CEA) found that US consumers are more confident about spending money on technology products. In fact, the CEA found that in July of 2014, consumers were more confident than they've been since the 2012 year-end holiday season.

The CEA says that this is a sign that the economy is getting better. CEA's chief economist and senior research director is quoted in the September 19, 2014 issue of Processor Magazine as saying, "The improved sentiment is helping establish a solid foundation for stronger tech spending."

CEA reported that consumer attitudes toward the broader economy were also tracking higher.

Tuesday, November 25, 2014

Dollarize your Software

You need to set a dollar-value on every part of your product. That advice comes from Jeffrey J. Fox, the author of "How to Become a Marketing Superstar - Unexpected Rules that Ring the Cash Register."

Unless you know how much your software is worth to your prospects, you can't do the big-picture marketing functions that are necessary for your success. Knowing the value of your product or service to your prospects and customers is essential, Fox explains, when

  • Determining which product to develop next
  • Segmenting your market
  • Positioning your product
  • Setting prices

And unless you know the specific dollar value of your software, you can't create the advertising messages you need to sell it, specifically

  • Developing product claims for your web site
  • Overcoming price objections from prospects
  • Explaining product payback and return on investment (ROI)

Software buyers don't care how long it took you to write your application, or how difficult it is to make it compatible with each new release of Mac OS, Windows, iOS, or Android. They only care about how much time or money it will save them.

Dollarize your software, and many of your marketing tasks will be simplified.

Saturday, November 22, 2014

Should Software Developers
Offer Social Authentication?

Social authentication is catching on. Seventy-seven percent of adult US Internet users have created online accounts by using their social identities rather than creating new userid/password combinations. A poll taken by OnePoll and Gigya (as reported in the October 17, 2014 issue of Processor Magazine) shows that consumers are becoming more and more comfortable with this process.

The social authentication process is also known as "bring your own identity" or BYOID. Don't confuse BYOID with bring your own device (BYOD), the increasingly popular practice of employees bringing their personal notebooks, tablets, and smartphones to work.

According to the article, the main reasons that users like being able to create accounts and log into them by using their existing social networking information are

  • It's easier to point to a social networking account than to fill in a new registration form.
  • Few users look forward to creating - and remembering - more userids and passwords.
  • BYOID makes it easier to share information with colleagues on the social networks.
  • Users feel that their data will be safer if they securely link to information on their social media site.

Software developers need to be aware of this new BYOID trend. If the difference between logging into your site (versus logging into a competitor's site) is that they offer the convenience of BYOID and you don't, then you could lose customers, traffic, and sales.

Thursday, November 20, 2014

Software Developers,
Know Your Customers!

"Know who your customers are and who just isn't one yet."

So says Julie Bick, author of "All I Really Need to Know in Business I Learned at Microsoft - Insider Strategies to Help You Succeed."

She urges us to study our customers and figure out which benefits are most important to them. That sounds like good software marketing advice.

Monday, November 17, 2014

Understanding People

Selling is all about understanding people.

So says Joe M. Gandolfo, an insurance salesman and author of the sales book "Selling is 98 percent understanding human beings ... 2 percent product knowledge." Robert L. Shook talks about Gandolfo in his book "Ten Greatest Salespersons - What they say about selling."

Gandolfo tells us that a salesperson has to believe in his or her product or service. And you have to believe that you're going to close every sale.

While most microISVs don't do a lot of face-to-face selling, you can convey these attitudes on your website, too. Describe your software as something that you're proud of. And confidently ask your prospects to click the "buy now" button.

Wednesday, November 12, 2014

Telephone Interruptions and microISVs

We've been trained to believe that phone interruptions are legitimate. They're not, Alec Mackenzie tells us. Mackenzie is author of the book "The Time Trap - Twenty Reasons for Poor Time Management."

Mackenzie believes that we have all sorts of excuses for accepting phone calls that we shouldn't:

  • We don't want to offend people by not welcoming their phone calls.
  • We want to know what's going on in the world.
  • We think we deserve taking breaks, and phone calls are breaks.
  • We believe phone calls provide fun opportunities to socialize.

Mackenzie urges us to learn techniques for ending phone conversations. The author suggests things like "Before we hang up, ..." and "I just have a minute or two before I need to run, ...".

I disagree with Mackenzie's premise. I view incoming phone calls as opportunities to learn more about my customers and prospects. People who call me tell me things that allow me to change my services to make them more valuable to my software developer customers. Phone calls give me an opportunity to bounce new ideas off of prospects.

Sure, you can spend too much time on the phone. But as a general rule, most microISVs could significantly increase their income if they spent more time talking with customers and prospects.

Monday, November 10, 2014

Categorizing your Software

Software buyers sort applications by category. And positioning is all about the location of your product in prospects' minds. As you start to design your next application, consider how you want prospective buyers to think about your new program. By designing your application with your market positioning in mind, you'll have a much easier time selling your new product to your target audience.

The History of Positioning

Fifteen years after Al Ries and Jack Trout wrote "Positioning: The Battle for Your Mind," Jack Trout released his updated analysis and insights on the topic of positioning. His new study of positioning is called "The New Positioning - The Latest on the World's #1 Business Strategy." The world had changed in those 15 years, and Trout has a lot to add to his earlier thinking about marketing and positioning.

The original Positioning book by Ries and Trout was a breakthrough because it changed the focus of marketing from what you do to the product to what you do to the mind of the prospect. We've learned a lot about the mind in recent years, and the current book talks about what we've learned, and how it should affect the way we do marketing.

Marketplace Forces Define Categories

Specifying a category for your product or service can be complicated. Here are some of Trout's latest ideas, translated into the software development industry.

Creating a product or service in a new category, Trout explains, makes it very difficult to sell. This is especially true, I think, in the software industry, for a number of reasons:

  • Google and the other search engines are keyword and key phrase oriented, and often these words and phrases are categories. If your prospects don't know the category name, it will be more difficult for them to locate your application using search engines.
  • When you send press releases to magazine and newspaper editors, many of these writers want to determine which cubbyhole your program fits into, so they can put it in context and compare it to similar software. Totally new software is a real challenge for columnists and reviewers. They may play it safe, ignore your application, and write instead about a program that's in a category that their readers will understand.
  • When prospects search for software on a download site, they first select a category or type the category keywords into a search box. If your application doesn't fit neatly into an existing category, it's going to be very difficult to find on the download sites.

Who Creates Categories?

Trout says that companies don't create categories. Users do.

In my opinion, companies with substantial marketing budgets can do a lot to create their own categories. If you're a well-funded software publisher and you can get prospects to recognize your product or service, you stand a good chance of convincing them to categorize your application as you'd like. With a typical microISV budget, however, it can be quite a challenge.

It's difficult to invent a new category. It's usually easier to segment an existing category, and try to set yourself up as the market leader in your new sub-category.

Trout names a couple of exceptions - Tandem created fault-tolerant computers, and Orville Redenbacher created gourmet popping corn. But for the most part, marketers cannot easily create new categories for their products and services.

Your Current Marketplace Positioning

Is it better to try to get the world to accept your new category? Or can you sell more software by declaring that your program fits into an existing category, and that it has more features - perhaps unexpected features - than your competitors' offerings? It's complicated.

Is Your Niche Growing?

Your ability to create a new category for your software depends upon whether your software is in a growing marketing niche, a stable one, or one that is in decline.

If your software niche is growing and branching out into new directions, then you might be able to turn one of these branches into a new category, and dominate that category. We saw this happen with anti-virus software a few years ago. Several companies competed with each other with applications that were based upon huge databases of virus signatures. And a few companies broke away from the pack and took a different approach to protecting PCs from the bad guys. These innovative companies were able to create new categories - or at least new sub-categories - for their applications.

If your software is in a stable niche, then it's harder to create a new category for your applications. Unless you're doing something which is particularly innovative, you will have trouble convincing the public that you've introduced a new category of software.

If your software category is in decline, then you have an opportunity to define yourself in a new category. Your competitors are probably not spending a lot of money on product design or on advertising. You can take advantage of their passive marketing to nudge your program into a new category, and declare yourself to be the leader of this new product niche.

Take Me to Your Leader

Your ability to define a new category of software also depends upon whether your software niche has one (or more) established leaders, or whether there are a lot of contenders for that title with no obvious leader.

Breaking into, say, the zip archiving business would be very difficult today. And convincing people that your application does everything that they can get from the free archiving capabilities found in Windows, as well as the functionality found in WinZip and WinRAR, would be a difficult task. To go further, and position yourself as the publisher of an innovative new category of archiving application would be nearly impossible.

On the other hand, if you're competing with a number of microISVs, none of which has a leadership position in your marketing niche, then your chances of creating a new category for your program are much better. The buying public is less likely to know exactly what each of your competitors is offering. And that gives you a chance to define a new category for your application.

How Strong Is Your Budget?

Your ability to position your application in its own category depends a lot on the size of your marketing budget. If you can afford to launch and sustain an advertising campaign that defines your program as an innovative new application, then you might be able to create a new category for your brand.

If you're as innovative in your marketing as you are in your application, you might be able to craft a press release campaign to accomplish the same goal, at a significantly lower cost.

A lot of your success will depend upon how well funded your competitors are, how willing they are to compete with you, and how clever their marketing ideas are.

The Bottom Line

You probably can't control the entire marketplace when it comes to positioning your software in the optimal category. But knowing the issues and forces at work will make it easier to position your software properly.

The time to start thinking about software categories and positioning is when you're designing your application. Don't wait until you're beta testing your program to start thinking about how you're going to market it. You need to bake your marketing innovations into the software itself.

Saturday, November 8, 2014

Take Control of your Assumptions

"Don't be blinded by your assumptions. Just because you run a promotion and it works doesn't mean that it worked for the reasons that you thought it would."

... quotation by Sergio Zyman from his book "The End of Marketing As We Know It"

To learn more about assumptions, or to learn more about Zyman's book, visit my Software Marketing Glossary.

Thursday, November 6, 2014

The Software Marketing Funnel

"Marketing is a funnel. You put undifferentiated prospects into the top. Some of them hop out, unimpressed with what you have to offer. Others learn about you and your organization, hear from their peers, compare offerings, and eventually come out the bottom, as customers."

These insights come from Seth Godin's 2006 book "Small is the New Big - and 183 other riffs, rants, and remarkable business ideas," a compendium of Godin's blog postings and his thoughts about blogging.

For a brick and mortar store, the sales funnel requires marketing and advertising to get people to visit the store, and merchandising to ensure that prospects find the products or services that they need to solve their problem. A powerful in-store sales message is also needed to close the sale.

On the Internet, the same elements are required. You have to position your software attractively, describe it convincingly, and deliver your sales presentation to your prospects. When prospects visit your website, they need to find an intuitive interface that is easy to navigate. You need a persuasive sales message that explains the features and benefits that your software offers.

Too many software developers concentrate on creating a state-of-the-art website that is driven by the latest technology. You'll sell a lot more software with a simple website that delivers a powerful sales message.

Monday, November 3, 2014

Enchanted Objects, the Internet of
Things, and Software Developers

Book Review of Enchanted Objects - Design, Human Desire, and the Internet of Things by David Rose, published by Scribner

Too many software developers believe that desktop and laptop software are today's news, and that software as a service (SaaS), cloud computing, and smartphone apps are the next major technology hot buttons. Truth is, SaaS, the cloud, iOS, and Android are all mature markets. The next big trend on the horizon is the Internet of Things. And it's time for software developers to begin thinking about how they'll be profiting from this new movement.

In this July 2014 book, David Rose states that by the end of the decade, the Internet of Things (IoT) is going to change all of our lives as much as the Internet changed our lives beginning in the late 1990s. While lots of journalists are trying to predict the future of technology, Rose has hands-on knowledge of this new movement. He spent the last 20 years developing toys, furniture, jewelry, and other objects that are connected to the Internet. He teaches at MIT's Media Lab, and has started a number of IoT companies. And he sees a bright future in the creation of what he calls "enchanted objects."

In Rose's vision of the future, the connection between people and machines will have a lot less clicking and dragging, and a lot more enchantment. He believes that ordinary objects will be turned into extraordinary ones, without our having to navigate menus or learn a new system of gestures.

The author is fascinated with the magical objects that have captivated humans for centuries, from ancient legends to today's pop culture. He believes that the future of computing lies in the creation of enchanted objects that will change our lives.

Rose was concerned about the personal tragedy and the skyrocketing costs that are caused by people not taking the pills that their doctors have prescribed for them. Depending upon which study you believe, people take between 40 and 60 percent of the medications that have been prescribed.

Rose invented the GlowCap. "It looks like a regular, childproof, amber medicine bottle, but has a special cap that glows...It has enchanted users enough that people who own one take their medications over 90 percent of the time."

In addition to reminding users visually to take their pills, the GlowCap is connected to the AT&T Cellular Network. It texts or phones the patient with a reminder to take a pill. It also notifies their friends, relatives, and doctors who can encourage them to take their medicine. The GlowCap even contacts the pharmacy when a refill is needed.

Rose envisions a future in which "small amounts of computation, connectivity, and interaction" can transform our lives. Simple, enchanted objects can make us healthier and happier.

Enchanted objects will compete with three other visions of the future. The current marketplace leader, of course, is what Rose pejoratively refers to as the glass slab. Rose believes that smartphones, tablets, and computers will "continue to expand, consuming everything in {their] path." He poo-poos Google Glass, for example, as yet another glass slab with its tiny screen and its new gestures for marching up and down menus.

The second movement is the prosthetics and wearables trend. Since the creation of the cochlear implant in the 1960s, people born without hearing have been able to recognize at least 90 percent of spoken words (and 100 percent when combined with lip reading). Many of today's wearables are costly and bulky. Both of these flaws should diminish in the future. While there is a lot of merit to wearable devices, Rose prefers a future in which stand-alone enchanted objects help us solve our technology-related problems.

The third alternative to enchanted objects are social robots. Rose will grant you that the Roomba vacuum cleaning robot is cute. But he doesn't believe that robots that resemble humans will be accepted by most people.

So enchanted objects it is, Rose advises.

Rose shares a few dozen stories about specific products - specific enchanted objects - that have changed people's lives. I found some of them to be compelling, and others to be measurably less so. But I'm sure that I'll have the same reaction to the countless "Top Applications in 2014" articles that will be published by consumer and business tech magazines in the coming months. I doubt that Rose expected all of his readers to fall in love with all of the enchanted objects that he describes.

There's an in-depth discussion about human drives, and how enchanted objects can help us deal with these all-too-human needs. Rose discusses solutions to our need to know what is going on around us, our desire to be connected to our friends, loved ones, and colleagues, our need for safety and security, our need to be healthy, our desire to travel from place to place, and our need to express ourselves in many ways.

Rose discusses the seven "abilities of enchantment." They are glanceability, gestureability, affordability, wearability, indestructibility, usability, and lovability. For today's software developers who will be designing tomorrow's Internet-enabled technologies, Rose's discussion presents an in-depth analysis of which design elements work, and which failed to engage a significant segment of the buying public. It's hardly a blueprint of what needs to be developed in the future. But it's the best roadmap that's available at this early stage of the IoT.

The three things that I love about this book are (1) Rose's clear vision of how technology should change in the coming decades, (2) his analysis of the marketplace and the way he delivers his analysis in logical, bite-size pieces, and (3) the enthusiastic and optimistic view of the evolution of the human-machine connection.

According to the latest news from ABI Research, as reported in the September 19, 2014 issue of Processor Magazine, the Internet of Things is poised for a huge growth spurt in the next six years. ABI predicts that the IoT will pass the 16 billion mark for connected wireless devices by the end of 2014. That number will grow to 40.9 billion devices by 2020. Only 32 percent of the connected devices will be smartphones, tablets, and PCs. The opportunities are promising for microISVs who embrace this new technology today, and prepare for the future. There may be a lot of enchantment in the future of microISVs in the software development industry.

Learn more about David Rose's book "Enchanted Objects" on amazon.com.