So, why are sales shrinking at an ever increasing rate? There are a number of reasons:
- PDA's are dead
- SmartPhones are hot
Well, to understand the shift you do not need to understand the devices (in this instance PDA -vs- SmartPhone), you need to understand who is buying the devices and their view of them has changed. The big difference is that SmartPhones (pick your flavor, be it Treo, Windows Mobile, Symbian, etc.) are at or close to becoming a commodity. What is is creating the sales of the current batch of SmartPhones is based not so much on capability (unlike the war between PDA's of the past, i.e. Palm, Dell, Handspring, etc.) but on slick marketing. A case in point, the Motorola Razr. Love it or hate it you have to admit that the marketing behind it has been extremely sexy. Think back to the first Razr commercials you saw, what was the message? Capabilities? Nope, it was the look and feel. Everyone one wanted the cool new Razr! LOOK AT IT! LOOK HOW COOL I AM, I HAVE A RAZR! I have a few friends who have one and after the newness wore off they universally said that it was not that great of a phone much less SmartPhone (which it certainly is not).
What does this have to do with sales of software for SmartPhones? Looking back to the PDA heyday, think Palm V for example, and one thing was clear; people who bought them looked at them in much the same way as the purchase of a notebook computer. They bought them based on form factor, speed and what they could do. Could meaning what software would run on them which means how could they build their own device. Whereas SmartPhone consumers expect them to do everything they need out of the box, no 3rd party software necessary. They do not care how much memory they have for installing software, unlike the PDA buyers who based a large part of their purchase decision on how much free memory a device came with. This is being reflected in declining sales of software by 3rd party developers for all the mobile OS devices and further is being compounded by the carriers.
The carriers part in this is simple, they are not promoting software via their decks. They are promoting "entertainment", i.e. games, wallpapers, ringtones, ringbacks, etc. Same old stuff that has been around for a long time, just repackaged. And the decks have extremely limited shelf space due to the screen size. Again, compounding the problem. Then to top it off, while getting on the carrier deck might be seen as the holy grail for a product the revenue shares are at best 40% to the provider of it. Not bad of course if your product sells eleveny-billion copies but beyond that where does that leave you?
Another factor affecting reduced mobile software sales, though in this instance it is specific to the Treo line, is the volume of sales that are being made by corporations. This has impacted software sales primarily due to three factors:
- The purchasing companies IT departments are instructing the employees to not install anything on their Treo
- Adoption of the Treo's bundled with Good Technologies Good Link means that synching via the desktop/notebook PC is not a requirement to keep contact management data up to date. No cradle means no way to install software other than directly via the install tool that Good Link comes with.
- Treo's are being provided to employees and are thus seen as something they are "required" to have. Contrast this with the PDA purchase of years ago which was paid for by the employee because they wanted it, not because it was required.
- Does the software you created have a demo available? If so how long is the demo period for? Give yourself 2 points if a demo is offered, 1 point if the demo is for 14 days, 5 points if it is for 30
- After the demo period expires, can it still be used (even with limited functionality)?
10 points if it will no longer work, subtract 10 if it continues to function. - During the demo time period, how often does the software nag to purchase?
Every time they use it, 1 point. Once per day, 2 points. Once per week for the first two weeks and then once per day and finally every time it used after that with a display letting them know how many days of use they have left, 10 points. - Within the nag screens, how are you instructing them to pay for it?
To go to your website, 1 point. Presented with option to pay via the device wirelessly, 10 points. Instructs them to read the documentation for details, no instructions, etc. Seriously? Subtract 10 points.
A couple hints, within the nag screens give them other hints and tips. In other words tell them about some hidden features along with the nag to purchase. By doing this you are feeding them more reasons to keep using the software and the more they use it the more likely they are to buy it!
Understand that sometimes you will need to step away and detach yourself emotionally from a product. Analyze if the hours you are putting into it are worth it or could be better used by enhancing another product or creating a new one. Sometimes it is better to end-of-life a product than it is to add to your frustration by continuing to feed a dying legacy.
Reinvent your products, yourself and/or your company. Think back to the year the Ford Taurus was released, for many years thereafter it was the number one selling vehicle in the United States. Is that still the case today? Of course not. Why? Simple, Ford rested on it's laurels while the competition had the market in their sights. People do not buy the product that was hot last year, they buy the product that is hot TODAY.
Penny wise and pound foolish? I hear over and over about how the ESD's are evil. While I am not going to argue the validity or invalidity of any of the bullet points many use to base that claim, nor the reduced market share they represent, suffice it to say they do provide value. While you can get a credit card processor with rates in the 3% or so range, thus less than the 10% to 20% the ESD's charge for their ecommerce solutions, what else do you get in return? It is beyond the context of this post to go into a comparison of the ESD's, so for this example I will use Mobihand.com. Mobihand retains 12.5% for developers to use their ecommerce solution. Not bad when you consider all the pieces it comes with;
-They manage the ecommerce servers, bandwidth, coding, etc.
-Sales at your site count towards the best sellers lists at their site and we all know how valuable getting onto a best sellers list can be
-On device order processing
-Preferential treatment for email and other marketing promotions
-Ability to list other developers products in your store with a revenue share going to you
-They deal with the CC processor on chargebacks, etc.
Now then, saving you all the hours creating the above would take and not even mentioning the hours you will not be spending on maintenance it might be a pretty good deal. Especially if you do not have the resources to dedicate someone to those items.
Shift focus by getting into "Business Development/Sales" mode and more...
- contact the drivers now. For example, reach out to Good and find out what opportunities there might be for your products to be included in their bundles.
- look through your customer list and see how many have company email addresses where multiple people from the same company have made a purchase. Shoot off an email/get on the phone and call them, find out if there might be an opportunity for a volume purchase by the company.
- get another set of eyeballs on your product and website, to give you a professional review. Yes, this cost money though is very cheap in relation to what the return can be. Shameless plug, contact Compeau/Fawkes to get a marketing review done.
- diversify, get your top selling products ported to the other mobile OS's.
- get back to basics, seriously, when is the last time you analyzed traffic to your site, did SEO, checked ranking at Google, bought Google ad words, etc.?
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