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Selling to emerging markets - China, India, etc

We have a tool for software developers that we have been selling for a few months. All of our sales have come from the US, European Union, and Pacific Asia.

We haven't sold anything into emerging countries like India, China, Russia, and Brazil.

Has anybody had any success at selling software into emerging markets? If so, what advice do you have?
Roger Jack Send private email
Tuesday, September 21, 2004
 
 
Unless you're selling CD/DVD duplicating hardware, don't expect much.
.
Tuesday, September 21, 2004
 
 
Some years ago I was talking to a developer who was using our tools to deploy an application in China.  He lamented that he would sell one copy of his expensive app for manufacturing, and that would be it - the rest of the companies who might want to buy it would simply get a hacked version (it used a dongle) from the first company that bought it.  Not a pretty picture, I asked the guy why even do one sale to China since he was going to get screwed, and he replied one sale was better than none.

In all the years we've been selling developer tools I think we've had less than a dozen sales to China, India, Brazil, and Russia combined.  One guy from Brazil sent payment by glueing two pages from a Brazilian software magazine together with US currency inside, and sent us the whole magazine.  He faxed instructions on which pages had the loot between them.

I am not making this up.
Mitch & Murray (from Downtown)
Tuesday, September 21, 2004
 
 
M&M - is that because he was afraid the govt/post office would confiscate any outgoing currency?
Dan G Send private email
Tuesday, September 21, 2004
 
 
There are several problems you have to deal with when selling in East Europe, China, etc. You may not be aware of all of them.

I'm a developer in East Europe and I have sold software in East Europe. I also have seen how some companies in the US sell software here.

So, if you really want to sell in East Europe, I have some advice for you. Unfortunately it is hard to follow advice.


1. People and companies in East Europe have very low wages.

If you earn $4000 per month, then a $100 tool is 2.5% of your monthly salary. If (like in East Europe always happens) you earn $200 per month, then the same tool is 50% of your monthly salary.

Also, the percent of disposable income in East Europe is lower in East Europe than in the US or Western Europe.

So, in order to sell in East Europe, you have to lower your prices.


2. People and companies in East Europe don't have credit or debit cards.

It is very hard to get a card. Even now when this is changing, it is extremely hard to get a card from a bank which allows you to pay online with that card.

So, in order to sell in East Europe, you need a local processor who uses local methods of payment such as bank transfers and then sends you the money at the end of the month.

You have to choose a serious company. It may be best to try with several companies and only keep the ones who deliver results.

Some companies with lots of "connections" to other companies may sell quite a lot of software.


3. In East Europe there is rampant piracy.

The amount of piracy is decreasing, mainly due to the efforts of large companies such as Microsoft who want to sell locally.

Also, companies pirate less than individuals.

So, in order to sell in East Europe, you need to have a software protection.

It is best if your app is targetted at companies and not at individuals. However, forget about charging a premium for the software because it is "enterprise software". Nobody in Eastern Europe is going to pay that premium.

If you are targetting companies, an average software protection will do (for example: use ASProtect or Armadillo).

If you are targetting individuals, then you must have an outstanding, bulletproof software protection (for example: use ASProtect or Armadillo AND harden this with your own protection bits).



Summary:

In order to sell in East Europe:


1. It is best if your software is targetted at companies, and not at individuals, because companies pirate less.

2. Implement a serious software protection.

3. Lower the price of your software. Find out how much is a reasonable price for your software in that country. Forget about charging an insane amount of money just because your software is "enterprise software".

4. Find a local company to sell your product using local methods and payment. If possible, find several companies, let them sell for 1 year and then keep only the companies who deliver results.
Developer in East Europe Send private email
Wednesday, September 22, 2004
 
 
> M&M - is that because he was afraid the
> govt/post office would confiscate any
> outgoing currency?

The answer is bleaker than you think.

I belive he was afraid that the postal office workers would steal the money in the mail.
Developer in East Europe
Wednesday, September 22, 2004
 
 
You can also consider to localize your software to those markets, such as text, dates, numbers and currencies, etc.
Evgeny Gesin Send private email
Wednesday, September 22, 2004
 
 
If your software is complex (many texts, complex user interface) and the app isn't already localized for several countries (so you have support for localization) I would advise against localizing in the beginning.

See first if the software sells in a country.

Then find a local company to localize the software, ask them the costs, and then decide if it's worth it to localize.
Developer in East Europe
Wednesday, September 22, 2004
 
 

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