* The Business of Software

A former community discussing the business of software, from the smallest shareware operation to Microsoft. A part of Joel on Software.

We're closed, folks!

Links:

» Business of Software FAQ
» The Business of Software Conference (held every fall, usually in Boston)
» Forum guidelines (Please read before posting!)

Moderators:

Andy Brice
Successful Software

Doug Nebeker ("Doug")

Jonathan Matthews
Creator of DeepTrawl, CloudTrawl, and LeapDoc

Nicholas Hebb
BreezeTree Software

Bob Walsh
host, Startup Success Podcast author of The Web Startup Success Guide and Micro-ISV: From Vision To Reality

Patrick McKenzie
Bingo Card Creator

Selling shareware for $100-$300

Imagine you are not in a highly vertical market, not in a highly horizontal. May be somewhere in between.

What you have to do in order to position your shareware in a way to be able to sell well at $100-$300.

By shareware I mean software created and being sold by a single person.

For example Joel is selling CityDesk in that price range. He is not a one-man-show but CityDesk is not a rocket science either.

Obviously you can't have a product that someone has and sells for $20.

Let's assume that the software is good and brings value to customers. Let's assume that we managed to differentiate it from the others.

So how you can persuade a customer that it really is worth that much?

And what channels will you use to sell software priced at that range?
Boris Yankov Send private email
Wednesday, September 29, 2004
 
 
Most $300 software is really only worth $20.
muppet 3.11 platinum edition Send private email
Wednesday, September 29, 2004
 
 
Is what most developers think and then they go on to roll there own version of that $20 product spending $5.000 of the company cash in wages, after which they will still claim $300 was way too expensive, and go on to spend another $3.000 a year maintaining their 'inhouse' tool, boasting about how invaluable they are to the operation.
Just me (Sir to you) Send private email
Wednesday, September 29, 2004
 
 
We're going to be selling at $20 a single copy. Why, because as a micro-ISV, I need to offer a compelling USP (unique selling proposition - why give us your money) that gets people talking and counterbalances the limitations of being a mISV.

A couple further points:

Enterprise, corporate etc sales discounts: Nope. In fact, we plan to charge MORE. Maybe crazy, but after 20 years of being in and around a few hundred corps, what they want is dedicated, competent support, training and customization.

So instead of saying, we'll sell you are $20 app for $10 a seat, we will say, We'll sell it to you for $40, but that includes dedicated tech support with a SLA, access to professional corporate trainers who we certify and a nice large dollop of customization.

People arn't dummies: my core market of self-employed, small businesses resent paying "big boy" prices and not getting the goods.

My two cents: I'll post here as to how it's going.
Bob Walsh Send private email
Wednesday, September 29, 2004
 
 
Bob, you need better screenshots of your product on your site.
Anon Send private email
Wednesday, September 29, 2004
 
 
Bob,

Having a low price doesn't remove the need to establish a USP (unique selling position).  It just means you have less of an obstacle to overcome.

Your home page doesn't tell me WHAT you're selling or WHY I'd want it.

(Did some digging and found your eXcel project manager thingy.  I wish I had the current version of excel to run it on. Looks cool.)

And, at this point, I still don't know what product you're *selling*.

Keep us posted on how things go.

My $.02 worth.  If it isn't helpful, ignore it.
Mr. Analogy {Shrinkwrap ISV owner} Send private email
Wednesday, September 29, 2004
 
 
I had an idea for some software that I wanted to charge around $200 - $300 for. While it's not too complex, it does basically one thing and it does it well. This particular niche has people who are willing to spend that kind of money on software. I would justify the cost by pointing out that the market is a limited one, and in order to make up for the development costs I would have to charge more. You know, standard economics... Supply/Demand, etc. See Eric's article on the subject.

If someone needs it and needs it bad enough to spend $200, then you make a sale. The rest falls in to the subtleties of marketing. You should make a promise, and ensure people that your product lives up to the promise. Get people excited about the prospect of ownership, and point out to them how it will make their lives easier, etc.

In my case, I can sell a seperate product that has just a subset of features for much less money. I can even create an online demo version of this feature-poor version that you have to come to the site for (a great marketing tool). By being able to download and/or use online a version of the product, I can establish it's quality.
www.MarkTAW.com Send private email
Wednesday, September 29, 2004
 
 
"I would justify the cost by pointing out that the market is a limited one, and in order to make up for the development costs I would have to charge more. "


BTW, customers don't care about this. 

I had a customer once say "I know it only costs a few dollars for each CD you copy".

I asked "Who pays for the first copy then? That cost about $40,000 to develope."

Custoemrs either understand this (because they run a business) and don't need it explained, or they don't get it and never will.


Either the product is worth the price (because it saves them that much money, basically) and they buy it, or it doesn't.

You can rarely charge more than the product is worth to the customer.  Competition may force you to charge LESS then it's worth to the customer.

BTW, difficult to has a successful company with just one product (even at $200 a piece).  Customer aquisition cost can be pretty high. But it's certainly possible.
Mr. Analogy {Shrinkwrap ISV owner} Send private email
Wednesday, September 29, 2004
 
 

This topic is archived. No further replies will be accepted.

Other recent topics Other recent topics
 
Powered by FogBugz