The following was authored by Nico Westerdale from BitsDuJour, the website that brings you exclusive 24-hour discount deals on some valuable software applications.  Thanks, Nico.

You’ve worked hard to perfect your application - it represents the end result of hours of planning, coding, debugging, and polishing. Now that it’s done, you need to get the word out on the street about your fantastic product, especially if there are other competing apps that aim to serve the same audience.

For many developers, the only marketing effort that they will ever undertake is the development of a website that showcases their software application. This approach, however, is less than ideal because websites take a while to become established on the internet.  Web traffic in those first few weeks of existence will be very low, almost nonexistent, and small developers need to start making sales immediately if they are to survive to fight another day. Those sales will not be forthcoming if you’re waiting for Google to index your site (it can take a while). And no matter how well-designed, your site won’t have a very high search index ranking if no other sites link to it, which is highly likely since no one knows about it.

Twitter represents a real opportunity for small shop developers to promote their software, but only if your relationship with the Twitterverse is carefully established and cultivated. There is a world of difference between “marketing on Twitter” and “effective marketing on Twitter”. Here are some tips on doing it the right way.

1. Register, then Follow Your Key Demographic

Your journey through the Twitterverse starts, naturally, with registering an account and profile name. Try not to pick a profile name that’s overly cold and corporate, but do try to tie your profile name back to your company or the product that you’re developing, so folks will associate your Twitter account with your product or service. Be sure to fill out your Twitter profile with a brief description of yourself, your product, and a link to your website.

After you’ve endured the arduous process of selecting your Twitter name, do a quick keyword search across the Twitter service and start following other Twitter users who do what you do, or are otherwise part of your target demographic for your software. Developing graphics software? Follow folks who are employed as graphic designers, or who design graphics software. By following their tweets, you may just learn a thing or two that makes your software even better. When you start following someone, they’ll be notified, and, after sizing you up, may start following you as well. This is how you build your Twitter audience. The best Twitter networks focus on a core group of people allied together around a common theme.

2. Be Open, Be Yourself, and Use Twitter as a Sounding Board

Not counting the Twitter accounts of sites that offer breaking news, daily discount offers, and other “in-the-moment” opportunities, businesses that view Twitter as just another electronic billboard are missing the point and are often puzzled when they don’t attract many followers. Successful users of Twitter attract followers because they do and tweet things that interest people, or otherwise offer a peek into a lifestyle that others may not see everyday.

You should start your Twitter account well before you plan to launch your software application, keeping your tweets professional (no vulgarity, for example) but personable, dropping hints about yourself in ways that demonstrate that you have quirks like everyone else. In other words, be a person on Twitter, and not a corporate presence or a PR intern or a robot that spews status reports about the latest build. When you reach a level of comfort with Twitter, and have developed some followers, start tweeting about your application, and how its development is progressing. It even helps to tweet about drawbacks, hurdles, and disappointments in your software development. The point is this: get people interested in you, and they will also become interested in what you do.

Keep tweeting about the progress of your application (along with the usual quirky details about your life), and you will build buzz for the application’s release. If you run into a coding problem, ask Twitter! Inviting the counsel of others makes them more likely to be personally invested in your success. It also helps you to build a better network by connecting with others who may be running into the same issues.

3. Promote Your Launch and Encourage Feedback

This is where a lot of companies start on Twitter, and this is where they fail. A company will register a Twitter account, and within an update or two, they’re literally screaming at people to buy their product. Since no one knows who they are, and it’s obvious that they’ve created a Twitter presence just to sell things, they get no takers. But you, having built up a measure of credibility on Twitter, now have an audience of followers who’ve followed the evolution of your project from drawing board, to coding, to debugging, and now - at long last- to launch day. You may want to consider offering a discount to customers that purchase your software using a link that you post to Twitter, or holding a contest to give a free copy of the app away to your 500th follower. No matter what, it’s your launch day and you should have fun with it.

Recruit your Twitter followers to help you spread the word of your launch by re-tweeting your launch announcement, and keep them updated throughout your first few days with tweets reporting how well your sales are progressing. You don’t have to divulge specific numbers, but something along the lines of “Incredible first day sales! Thanks to everyone” will be appreciated, and further help to put yourself out there as a real, live person behind the Twitter account. Solicit advice and questions from those who buy your app, and be sure to respond promptly.  You can use their suggestions as a starting point for the next version, which will give you even more to tweet about after the launch!

Using these tips, you can continue to accumulate greater numbers of followers, keep your existing customer base updated on your progress, provide immediate customer service, and generate buzz leading up to the release of each new version of your application.

Follow FastSpring on Twitter here.

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Andy Brice, a friend of FastSpring’s and the developer behind the SuccessfulSoftware.net blog, recently compiled data from a group of small software firms to analyze their conversion rates from visit to download, visit to purchase, etc. You can see the results from his survey and see how your site’s conversion rates compare with others by clicking here.

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For “buy now” buttons, it’s helpful for the button to be a bright color (e.g. red), to be large enough on the page to be highly visible, ideally to be located above the fold.  When possible, it’s wise to have a purchase link on every page of your site (this link could just be in your navigation menu that appears at the top of each page) even if it’s not specifically a buy button that appears within every page.  You want to make it as easy as possible for those who want to buy to do exactly that, irrespective of where they are on your site when they make the decision to buy or to learn about pricing and purchase details.

Some of FastSpring’s better performing buy buttons are these:

You can view a larger selection of buttons here

(Upon request, we can at times redesign a button to fit your particular order page needs.)

Notice how the various payment options are listed next to the buy button, letting customers have an idea upfront regarding whether there is a a payment method that applies to them.  Given that most popular payment methods are covered in the graphics, most users find at least one applicable payment method that attracts them to then click the buy button and proceed with their purchase.

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If it’s indeed the typical software/hardware bundling arrangement, you’ll likely be expected to accept a per unit fee ranging anywhere from $.10-$1.00 per unit bundled, depending on the OEM partner, the anticipated unit volume, etc.

Assuming that’s the range you’re presented with, you’ll want to ask the OEM partner to justify that kind of rate by guaranteeing a minimum volume.  For example, if they are only open to paying $.25 per unit, require that they bundle a minimum of 15K or 25K units in the next 12 months, and explain that otherwise there is no way to justify their extremely low per unit rate relative to what average customers are paying you per unit (for example, your MSRP might be $29.95 per unit).

Setup a sliding scale so that the more units they bundle the lower per unit rate they’ll pay, so the OEM partner is incented to bundle as many units as possible and so they can get the low rate they desire from you, provided they hit certain metrics, but just not for “free”.  Some OEM partners will be able to bundle a few thousand units, while some of the larger ones can do a few hundred thousand or even a few million units, so it can really add up, although they will expect the rate per unit to decrease the more volume they can do, which is fine.  Just make sure if they tell you that they’re expecting to bundle a large volume of units, that you tie them to it in order to get the pricing they desire from you.

There are a few reasons why OEM partners get away with such low rates.  They can often guarantee a substantial minimum number of units (though not always, and sometimes it’s still a deal worth doing).  OEM partners realize that you get free branding when they bundle your products, that you can sometimes collect email addresses from their users, upsell their users, etc., and this value you receive further justifies their low rates.  Also, you, as their partner, can appreciate the economics that lead to the OEM partner only being able to pay a very small % of the purchase price they charge their own customers given all the other expenses they have in each sale of their own product that they’re bundling you with, the other bundling product partners they’re paying along with you when they sell their own product, etc.  If they sell their own product say for $30.00, pay retailers, distributors, etc, buy advertising, have a significant cost of goods on their hardware product (being that it’s a hardware product with hard costs, not a software product), plus pay for 3-4 bundling product partners each being paid along with you, you can see why they can’t afford to pay, for example, $5.00 per unit to each bundling product partner, but are instead dealing in pennies per unit.

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We recently added a section of our website that features client testimonials.  You can see what clients are saying about FastSpring here.

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Personally, I would only go with a .com. If it’s not an option, I’d go with a different domain. With that said, I have had a software firm that only has a .net (we didn’t obtain a .com for Picasa.net until right before we sold Picasa to Google) and it did fine, but a certain % of users will look for you at the .com address and never find you or will find a similar service depending on who owns the .com. It’s hard to know what that % will be for your particular offering. You can bid on Adwords for the domain with .com and try to push those folks to your non-.com page, but buying .com keywords via Adwords doesn’t always work out.

There is a real credibility issue when a business doesn’t hold the .com, and it can make a significant difference in results depending on the type of business. It doesn’t mean you can’t still be successful using a non-.com, but why add more obstacles to success than one already faces if you don’t have to? One site that can help when trying to find a .com that fits with the words you want to incorporate in your domain is NameBoy. It’s not great but it can at least help spark some ideas.

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I’ve been involved with a software product in the past that used online activation.  It had pluses and minuses.

It made it harder for users to do sketchy things in general with the product in terms of usage and purchasing/sharing, and let us track more of what they were actually doing with our software.  When a customer complained about something and requested a refund, we could always tell if the customer had tried activating on countless PCs before contacting us so we had an idea of how honest they might have been being before we responded to their complaint or refund request.  And we were able to have a policy that refunds were an option when no activation occurred but not when the user already activated (other than in special situations where a customer was particularly upset for a legitimate reason) since we had no way to stop them from using the product indefinitely once they activated.

Using online activation more or less eliminated piracy, which was great and we felt like one of only a small number of software firms that didn’t have a crack out there.  However, it led to customers complaining about lack of Internet connection being a problem, so it’s good to have a solution for those without net access such as an offline activation scheme to use in special situations.  It also limited our ability to work with some distribution partners.  We had to let it go to an extent when we entered retail stores since retail store users are less sophisticated than online users and definitely can’t be required to have Internet access.  In retrospect, while that opened us up to a little piracy, it was a good move overall.  Being overprotective has its costs and in our case the distribution opportunities were worth the cost of a small % of users not paying for the product, esp. considering a good % of those type of users wouldn’t pay for our product anyway, given that they’re the type looking to steal it.

Ken’s added thoughts:  If you sell into schools for example, not only will they often not have net access, but they often need a method to install on many machines in a more or less automated way (silent install).   The registration scheme must be simple and not require unique action on each machine in cases like this.  Also, one thing to consider is that if the registration process is too difficult, it can cost you money.  I’m aware of at least one company I work with who regularly gets chargebacks simply because their customers are all to often unable to navigate all the steps required to complete registration.

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I’m not a big fan of MBAs, though it can be good for people who are not naturally business oriented and have minimal business experience.  For entrepreneurs, I’ve often recommended reading this book:
The Portable MBA in Entrepreneurship

I read this when I started my first company out of college (here’s an old story on it: GrapeApe) and it helped me greatly.  It covers key areas the MBA covers, and it’s from Babson College, home of the original entrepreneurship MBA program.

Between this book and having the experience of starting a business, I felt after my first business that I had better experience earned “in the trenches” than I would have obtained through an academically oriented MBA program.  I have plenty of friends with MBAs and I think they would have been better served investing the money into starting a business and learning on the job.  That approach is not for everyone, but it sure is educational if you can stomach it, and can be quite fun as well (not to mention, no academic homework!).

If you want to read Uncle Saul’s take on getting an MBA, you can view his post here. For those who don’t know Uncle Saul, he’s a fellow blogger and friend to FastSpring whose blog we enjoy.

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In my experience, Tuesday through Thursday is best, with Tuesday/Wednesday being better than Thursday.  On Mondays, people’s inboxes are too full from the weekend and they’re overwhelmed with email, they need to dig into work, etc.  Fridays, people are thinking about the weekend.

However, it also can depend on the email content.  If you’re marketing an entertainment product, for example, sometimes it can perform better on weekends since weekdays are less about leisure.  There may be fewer email “opens” on weekends but better response for non-productivity product content emails.  At the end of the day the best way to know for sure what’s best for your particular product is of course to test the different dates for the same offer and sent to the same type of users (comparing apples to apples across different days).

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UI Refresh

We recently refreshed 3 of the main SpringBoard UI elements based on your feedback and experiences.

Toolbar

All toolbar icons have been updated to a consistent look and location on the toolbar. The home link has moved out of the main toolbar into the navigation bar.

Navigation Bar

The navigation bar has been revamped for a more prominent look, adding an integrated home link, and a more noticeable help icon for pages with help information.

Larger Click Targets

The click targets have been increased in size to speed up navigation around the UI.  Rather than positioning your cursor exactly over link text, you’ll find that click targets are now generally wider and taller throughout.

New Verisign EV Store Certificate

The SSL for all stores has been updated to use a Verisign Extended Validation (EV) certificate. Verisign has an excellent brand reputation which many customers have come to recognize. The EV certificates display more prominently in the address bar of both Internet Explorer 7 and FireFox as a “green address bar”.  You may have seen this certificate type already on sites like paypal.com.

You may optionally display a clickable Verisign logo on your store look and feel.  If you’d like to add the Verisign logo to your look and feel, please see the documentation under Styles / Appearance, or contact us using the “Support” toolbar link and we’ll make the update for you. Displaying the Verisign logo in your look and feel is not required for the green address bar to appear.

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Below are some of the benefits to outsourcing to a full service e-commerce payment solution vs. utilizing a basic payment service like PayPal or setting up your own merchant account.

* Focus on your core business and on growing your revenue rather than investing your company’s time, money, and resources into building and maintaining a commerce platform, a platform that will need to be constantly updated and improved as your business grows and your needs change. To get a better sense for the features you would need to build out on your own, review the list of features that full service e-commerce firms display on their web sites and you’ll have a better idea of the software development and administrative work, both upfront and ongoing, that is involved in building out your own solution on top of a basic payment service or by setting up your own merchant account.

* Eliminate chargeback fees (typically $15-$40 per occurrence) and chargeback management.  Let your e-commerce service handle them for you.

* Avoid the order-related customer service work, let your e-commerce provider handle this on your behalf.  Some e-commerce firms assign a Dedicated Account Manager to you who provides hands-on help with anything you need which can be quite helpful.  Gain access to a support staff trained for software product and software delivery issues as opposed to customer service representatives who are not trained specifically for handling software vendor issues.

* Get support for delivery issues specific to software products incuding delivery of download links, customized emails, generation of registration codes, and other items.

* Avoid tax compliance issues by state or country by having a full service solution handle tax collection, compliance, and payment on your behalf, including management of the European Union’s Value-Added Tax (VAT), California and New York state sales taxes, and more.

* Save time and avoid hassle by using an e-commerce service to minimize the volume of fraudulent sales.  Software focused e-commerce firms offer fraud prevention tailored to software sales.

* Increase international sales by displaying your order page text in each customer’s native language, displaying prices in localized currencies, and settling your transactions in the appropriate currency for each customer.

* Utilize multiple merchant accounts for payment processing.  No need to obtain your own merchant account, which typically costs 3.5-4%+ of every transaction (card processors routinely advertise rates of about 2%, but check your statements and you’ll see it’s far more because of the surcharges applied to your international transactions, higher rates charged on reward card transactions, corporate purchasing and debit card transactions, and higher priced American Express processing costs, fees for items such as chargebacks, etc.). Many full service e-commerce firms utilize multiple merchant accounts for backup security and the merchant account cost is included in the price of the service. Avoid working to obtain different accounts for different payment methods you want to support, doing technical development to setup and support those payment methods and to support multiple merchant accounts on an ongoing basis (the methods and accounts require periodic servicing due to updates and issues that arise), avoid paying monthly fees to merchant providers, turning over personal financial records, being personally liable for certain bank account funds, etc.

* Accept customer payments through as many methods as possible to maximize sales, including Visa, MasterCard®, Discover®, American Express®, PayPal™, JCB, check, and money order, payment methods offered by many e-commerce services.

* Gain access to a marketing distribution network and online marketing guidance offered by some e-commerce firms.

* Increase revenue through utilization of cross-sells and upsells on order pages which typically increases your average revenue per order by 15-45%.

* Utilize order pages branded with your site’s look to reduce cart abandonment.

* Increase revenue through sub-product listings (i.e. drop down menus for add-ons) and data collection throughout fully customizable order pages, an option available through some full service e-commerce solutions.

* Ensure your customers’ transactions occur on secure servers.

* Utilize valuable 3rd party marketing tools like Google Analytics for site traffic analysis, online ad campaign tracking, and affiliate programs for growing affiliate marketing revenues.

* Increase revenue by offering your customers the option to receive your product in physical format for an additional customer charge via an on-demand CD/DVD physical fulfillment network.

* Convert more traffic into paying customers by testing between and choosing from a selection of different order page and product layouts and offerings.

* Increase revenue by utilizing product discounts, coupons, bundles, volume licenses and other pricing adjustments.

This is a sampling of some of the many benefits to outsourcing e-commerce to a full service e-commerce payment solution.

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A user of the JoelOnSoftware forum recently posed this question.  Since we use S3, we’ll explain how we see the advantages.  For those who don’t know, at FastSpring we offer a fast, reliable, and secure global file distribution network which utilizes Amazon.com’s S3 bandwidth service to ensure your buyers have a smooth and trouble-free file download experience.

S3 has been great in our experience and according to a number of our clients.  The biggest advantage is multiple servers.  There are also some capabilities with S3 that would be a pain to implement by oneself.  For trial downloads it isn’t an issue, but for post-purchase downloads, S3 makes it easier to do time and attempt limited downloads, so that you can give a customer a URL and not worry about it being posted or shared too much, as it will only work for a few days or attempts (configurable).

As Amazon continues to build out a network around the world, I think you could eventually see S3 being comparable to the distributed speed and quality of something like Akamai.

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Since we’re not a financial blog, I’m not going to go into too much detail on this other than to point out a statement made in the past by legendary long term investor Warren Buffett:

“Be fearful when others are greedy, and greedy when others are fearful.”

He seems to be putting his money where his mouth is, making some recent investments in areas others are particularly fearful of.  I’ve noticed a lot of younger and less experienced investors are cashing out and heading for the hills while older, more experienced long term investors are actually buying, not selling.

Something to think about when you find yourself emotionally reacting to changes in the stock market.

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Recently a consumer software publisher said they were approached by a big German PC magazine requesting to feature the software product on the PC magazine’s covermount CD. The magazine asked to bundle a fully functional version of the software product. No compensation was offered. What should the software company do?

It certainly wouldn’t hurt to ask for money upfront. Some magazines will pay, and sometimes they’ll pay well since they’re asking for a free copy of something others are paying significant money for. We’ve done a couple of deals where the software vendor was paid a one time upfront fee of $5-$8K, though that tends to be the exception more than the norm certainly.

The next best thing is to give them an older version which prompts users to upgrade to the new version, or to give them a Lite version which doesn’t have all features enabled, and when users click a non-Lite feature they are asked to upgrade from Lite to a higher version.

It would be great if they accepted a trial version but they generally don’t since it doesn’t have perceived value to their readers. Another option is to ask them for a free advertisement in their publication or a story included in that issue about your product if they haven’t already offered that. Either option gets at least some traffic to your site where hopefully you can offer their readers additional products or editions of your product.

Some software vendors just want the free exposure (think word-of-mouth) more than anything and are OK without having a way to monetize it at all, and that’s fine too if you’re comfortable with that. Especially since the magazine is based in Germany and most likely most of those magazine subscribers wouldn’t have found your particular product on their own anyway, so it’s not likely cannibalizing your business to any great extent by giving it away for free, unless your primary market happens to be Germany, though even so there are still advantages along with disadvantages.

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