[Guest authored by Alison Simpkins of Access International. Access is a FastSpring partner that helps grow software publishers' revenue through their international business development team.]

If expanding into international markets is a key element of your overall growth strategy then you’ve probably already considered some of the challenges that adapting your software application for new regions can bring. The increasing pace of globalization, accelerated by the growth of e-commerce and availability of on-demand applications, is forcing software publishers of all sizes to consider their solutions within the context of a much broader marketplace and to further examine regional markets for new opportunities.

Localization services offer many software publishers an affordable, scalable method for international expansion, enabling them to successfully target global technology customers and build sales in regional markets. While some large publishers can afford to manage localization internally, most find it far more cost effective to outsource the work to companies that specialize in localization. But for smaller publishers faced with limited global marketing options, republishing may yet offer the most viable solution to international expansion — especially among those considering the traditional retail channel.

Republishing arrangements work especially well for publishers who want to ready access to the international marketplace, but who, for one reason or another, are not ready to bear the costs of new market development. The republishing model also allows publishers to reach new customers in several different regions simultaneously, allowing even small software publishers to compete in the rapidly developing global economy. Typically, a republishing arrangement is structured as a licensing agreement in which the original software publisher grants regional sales and distribution rights to a republisher — ideally one specializing in both the local market and in the original publisher’s application category.

While the specific terms of each agreement will vary according to the goals of the publisher and their republishing partner, most agreements will necessarily include localization for the targeted region. The republishing partner will also market and distribute the application throughout mutually agreed upon channels, providing all of the necessary support and logistics needed to ensure successful penetration within the designated market. Most often, this arrangement yields pure profit to the original publisher who does not undertake any of the risks inherent in new market development. Rather, the original publisher receives a royalty from the republisher in exchange for licensing its sales and distribution rights within the specified region.

If you’re considering the republishing model as a way to develop additional streams of revenue from international markets, then there are several key things to consider as you begin to explore your options.

If yours is a multi-regional strategy, then it’s likely that you’ll be working with more than one republisher. Few, if any, republishers are adept at localization and market development within all application niches, or across all global regions. Therefore, it’s absolutely crucial to carefully research and vet your potential partners within each region, as your choice of republishing partner will largely determine the success of your endeavor.

What are some of key things to look for in a partner?

Because most republishers tend to focus on a specific solution category (utilities or games, for example), it’s best to seek out those who already sell into your category and understand your niche. Make sure, too, that the republisher understands the regional culture and also has a micro-level understanding of the local market for your category. It also helps to have feet on the ground in the local market, especially if you’re focused on the retail channel. Is there someone within your organization who is already in the region, who speaks the language, and who knows the retailers? If so, this person would be ideal as he or she can visit the various retail locations, talk to retailers and identify which republishers are selling well within your category.

You’ll also want to know who the local competition is and which republishers are representing your competitors. Which republishers, if any, are successfully representing applications or solutions that complement your own? Remember that you want to find a republisher who is incentivized to sell your product. This often means someone who doesn’t already have your solution, but who needs it to extend or complete an existing line. This information will also come in handy later on when you’re negotiating with potential republishing partners. For instance you may be able to negotiate a higher licensing fee if you know in advance that a particular republisher needs your solution.

If you don’t know where to begin your search then seek recommendations from other software publishers. Do any of your partners or colleagues have personal experience working with a particular republisher in your target region? Try to get recommendations from as many other publishers as possible — especially those who are in similar lines of business. Getting recommendations before you begin your search will help you avoid the pitfalls of working with inexperienced publishers, or those who simply do not need or understand your solution.

If you’re simply too busy focusing on your core business to thoroughly research potential republishing partners, then you may wish to consider outsourcing your search to an international sales and marketing organization or other rep firm like Access International. These organizations work with international republishers in global regions everyday and can readily identify the best partners for your business with little, if any, up front investment. Some will even handle contract negotiations with republishers on your behalf.

If you plan to handle the contract negotiations on your own, then you’ll want to make certain that the terms of any agreement you make with your republishing partner clearly articulate the branding, channel and overall go-to-market strategy. Will the software be sold under your brand or under that of the republisher? Which channels of distribution will used; OEM, retail, online, or other? How will the product be supported within the channel and when will it go to market? Generally speaking, it can take up to three months from the signing of a contract for your product to get to market so you should carefully consider the timing of all republishing initiatives within the context of your overall sales and marketing plans - especially if your agreement calls for any form of local support from you, the publisher.

Whether you decide to outsource your search for republishers or go it alone, it helps to know in advance what to expect from your partners. Establishing a republishing relationship need not be difficult and can yield significant financial rewards. By taking the time to fully explore your republishing options in advance, you increase the likelihood that your global expansion efforts meet with success.

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Over the past few months, we’ve been getting a large number of companies signing up for FastSpring who are complaining about how their former e-commerce provider was handling fraud. We’ve heard from a few of our own clients who have stated that once they switched their e-commerce over to FastSpring, sales increased 10-20% simply because FastSpring is processing more of their orders as opposed to those orders being held up due to excessive fraud concerns from their former e-commerce provider.

In a number of cases, other e-commerce providers are holding back a significant percentage of their orders until they can verify the orders are not fraudulent through manual, automated, or other methods. Some e-commerce providers are even attempting to reach the customers at their homes through automated phone messages to validate the orders are genuine. Others are manually reviewing orders and creating significant lag time before a customer’s order is fulfilled, assuming the process gets to that point. Not surprisingly, these tactics have been leading to a lot of upset customers and of course to lost revenue due to so many orders going unfulfilled. A key reason why e-commerce providers want to avoid fraud at all costs is because we lose money on fraud orders, chargeback fees, etc.

FastSpring protects your store against fraud without having that type of negative impact on your revenue. We auto-analyze each new order prior to each transaction occurring, seeking inconsistencies and patterns worthy of further analysis, but ensuring as many of your prospective orders as possible get processed. Our fraud checks are real-time so you avoid upsetting customers and losing sales because there are no automated phone calls to customers, no lengthy delays due to manual fraud checks, less unnecessary order flagging, etc. The process we use works great for our clients, and our chargeback rate is extremely low despite that we allow so many more of your orders to complete. As we see it, other e-commerce providers being so excessive with their anti-fraud measures serves the interests of the e-commerce provider, not yours.

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This question was recently asked on a forum. Here’s my take on it…

Typically affiliate programs account for 7-15% of a company’s overall revenue. Every situation is different, but that’s an average for affiliate programs as a % of revenue. Since they are revenue share based, provided the setup costs are minimal (many programs cost nothing or just a few hundred dollars to setup), they are generally worth doing. For most smaller software companies I would not recommend using CJ.com which is among the largest because their upfront/ongoing costs are too high, it’s a pain to setup and many smaller software merchants have lost money on CJ b/c of their fees which don’t always get offset by affiliate revenue. One of our software vendors recently reported it lost about $5,000 by testing out CJ due to the fees.

But we recommend ShareASale.com, which only costs a few hundred dollars to sign up, attracts a nice range of affiliate publishers, and is easy to setup quickly. That’s why we’ve integrated ShareASale with FastSpring. Don’t expect overnight riches but after a few months it could increase your revenue 7-15% if a few decent affiliate publishers pickup your offer, like the results, and stick with it.

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This article was written by Jason Foodman, CEO of SwiftCD, a FastSpring technology partner.

Selling software online today is tougher than ever. Many of the things that worked three, or even one year ago don’t work today. For example, advertising online has changed immensely both in terms of its usage, value and effectiveness. I’d like to outline a few items the typical software author can try, with little or no investment (other than time) on his or her part, to add revenue each month. Note that no single idea presented here will double the size of your company - but each will contribute to growth and provide services/products some of your customers are looking for today, but not finding on your site.

BUNDLES are a ‘no brainer’. If you have multiple products (and many of us do), the first thing I recommend is to create a bundle (typically of three or more products). A bundle is a great way to generate individual sales at higher price points, and move more total units of your individual products. This works especially well if your products are somewhat complementary to one another, and you have one or two that are very popular and one or more that are less known. The basic idea here is to combine products into a single offering at a discounted price, so purchasing the products individually would cost more than the bundle price. One way this can work very well is if you have a product that sells very well and another that sells very little. Normally the less-popular product is heavily discounted. And keep in mind the bundle concept also works as an upsell. Say Product X is very popular and Product Y, which sells for $20, sells very little. On your order page for Product X you could give customers the option to add Product Y for only $9.95. Whatever you get from those extra sales is ‘gravy’. And don’t be afraid of extra support or partial refunds – yes, those things can happen but the added revenue will more than make up for the added headache. The good news is that most of the registration services can handle bundles as part of their core service (defining a bundle and then automatically dispensing License Keys for each product in the bundle, for example). I’ve seen time and time again where a bundle will outsell in gross dollars one or even most of the products. If you don’t offer a bundle today, try it, you’ve got nothing to lose! (Note: the only caveat I’ve seen to offering a bundle is that you’ll want to make sure your registration service can provide partial refunds - these may come in handy from time to time). (FastSpring Note: FastSpring supports partial refunds.)

CDs will generate extra revenue for you. Whether you have one or multiple products, offer your registered products and your demo(s) on CDs. Put every product on the CD, call it your Download Saver CD and offer that to your customers at a price point to cover the CD cost, and even make a dollar or two for yourself - you’ll be surprised, some percentage of customers will opt for CD delivery of your demos over downloading each one. And if your ecommerce service has CD delivery/backup-CDs, participate in that service. Each CD puts every one of your products into the hands of a potential customer, in many cases leading to subsequent purchases. SwiftCD.com, a company which I am affiliated with, provides an excellent service in this area. There are no sign up fees, no minimum quantities required, no dollars come out of your pocket, and you can change the CD contents anytime you wish (online). CDs can have dynamic contents, such as a registration code, so you can also offer delivery of pre-registered individual products via CD. Many of the popular registration services offer and integrate with SwiftCD services. If your registration service has a CD delivery program, participate, if not then request it. Incidentally, services like SwiftCD can also help you with on-demand hard-bound “real” manuals and ”retail ready” boxes. (FastSpring Note: FastSpring has integrated with SwiftCD.)

GUERILLA marketing was a popular term for quite some time, you don’t hear it used as much today but it remains a powerful marketing technique. The basic idea is to be creative, find places and ways to get your message out (and I’m not talking about buying up lots of banner impressions!). Think about places where your customers would be, things they would read, clubs they would belong to – and market to those locations. And think about how to creatively market, how can you reach those potential customers in a way other than a banner or popup? Or, for example–and this is really a grassroots guerilla approach–how can you reach your customers’ customers in such a way that they drive the need for your product to your customer? One general technique I’ve always found effective is to make it easy. Make it easy for one person to tell another person about your software (this is how “Tell A Friend” was born), make it easy for one person to ‘stumble on’ and get a copy of your software, make it easy to find, easy to understand and easy to purchase your software. Guerilla marketing means being creative, being patient, being aggressive, and if possible, measuring the results (to learn and be more effective). Tactics often include joining clubs, participating in related chat rooms, forums, newsgroups, newsletters, meetings, conferences, etc. Find common ground with your potential customer and exploit that commonality to build awareness. And have fun with it, the best guerilla marketing efforts are the ones that produce a good story. For more on guerilla marketing search the web (try www.clickz.com as a good starting point) or check out guerilla marketing related books by Jay Conrad Levinson or Michael Levine.

MERCHANDISING - Another no-lose service is to offer your product/company’s merchandise on your site. The most notable company out there in this space is CafePress.com, a company I have no affiliation with but have had good success with. The idea is similar to SwiftCD, no sign up fees or minimum quantities. Simply sign up online, upload your logos and you can offer T-shirts, mouse pads and mugs to your site visitors. You probably won’t sell a ton of shirts, but anyone who wants to pay $10 and walk around wearing a shirt with your company/product name on it, more power to them - don’t stop this person.

AFFILIATES are always a great thing–anyone willing to sell your program and share in the revenue (typical affiliate commissions are 30%-50%) is someone you want to empower to do so. There are a number of affiliate programs available today, including ShareASale, LinkShare, Commission Junction, and more. Furthermore, many of the popular registration services have built-in affiliate programs which simplify the setup and tracking you will need. You’ll want to make sure your program is well documented and easy to use to minimize support. One step beyond are co-brand situations, where someone puts their label/brand on your program. Take care when designing software to not hardcode strings which will make this difficult, it can be a lucrative and easy way to expand your market. Along the same lines is localization, offering versions of your software in various languages. Often with a localized program you can also do deals with distributors in that country (revenue share). One trick I’ve done numerous times over the years is offer a distributor in a county an exclusive and a higher percentage if they will translate the product (and updates) for you. Speaking of localization, some software companies have also localized their entire sites, either manually or using services like FreeTranslation.com. Of course, the proverbial “Catch 22”, what do you do when you offer your site in French and people e-mail in to you in French? (I’ve usually managed to get by with one of the online translation services, such as “Babel Fish”). (FastSpring Note: FastSpring has integrated with various affiliate programs, offers a separate affiliate tracking system, and order pages are presented to customers in various localized currencies and languages.)

COUPONS and incentives are worth trying. A clever implementation I saw recently had a popup coupon on the site that activated in such a way that it appeared to be random or unique to my visit, as if I had won something or stumbled on a special deal. The author reported to me moderate success with that tactic, if nothing else it seemed to push a few who were on the edge over the top to register. Upgrades probably fall into this area, for major upgrades to your product (example: 2.0 -> 3.0) it’s not unreasonable to ask for an upgrade fee from your existing users. Some users balk at this, most understand. (FastSpring Note: FastSpring supports coupons and discounting.)

WEB SITE SEO is real. Make your site clear, SEO (Search Engine Optimized) and use good grammar. Lack of clarity and poor explanations hold back numerous sites and products I’ve encountered. People should be able to see from your home page exactly what you do, what you have to offer, and choose to Download or Purchase…don’t overcrowd the page with huge amounts of text, keep it simple (one of the oldest Software engineering concepts, KISS). Speaking of your site, optimize your site for search engines! I’m not an expert in this area but I’ve seen the results time and time again. (FastSpring Note: FastSpring order pages are search engine optimized, and FastSpring has partnerships with SEO agencies which vendors can utilize.)

MAILING LISTS are still effective. We all agree that spam is a major problem (and seems to be getting worse), but don’t let that turn you off from having a mailing list. Give your customers the option to sign up for an Announcement list and use that list strategically (and carefully!). Don’t clog your newsletters and announcements with advertising, tell people about your product updates, some tips for using your products, what’s coming next, special offers, and on occasion partner products you think they might find interesting (that relate to your product line and hopefully where you are an affiliate!).

SITE LICENSES/VOLUME PURCHASING are almost always worth offering. Again, you’ve got nothing to lose and occasionally you might get surprised. If you don’t even offer it, chances are nobody will take the time to write you and request it. If you offer site licenses and volume discounts, at least you can be sure to capture anyone who was interested and ready to purchase more than one copy. (FastSpring Note: FastSpring supports site licenses and volume discounts.)

THINK ABOUT YOUR CUSTOMER and tune your pitch, pricing and distribution to match. It’s not uncommon for some products to have mass consumer appeal, revenue driven almost entirely by corporate sales, or vice-versa. I’ve seen time and time again where technologists and programmers develop and release software, not realizing that they themselves are NOT the typical user of their software, the ‘average consumer’ or business.

ASK QUESTIONS. If you want to grow your business you should think about how effective your website is, how good your product is, how well the product is priced, what are the strongest benefits of your product, etc. There is no better person to ask this to than your customers, yet very few people take the time to get real feedback. A common technique is to survey, offer your users (potentially in the newsletter mentioned earlier!) the chance to take a simple survey about their experience with your company and products.

You can also ask at least one question on your order form, often this is ‘How did you hear about us?’. Even more interesting may be finding ways to query those who arrived but didn’t purchase. What kept them from purchasing your product, was it the description, the price, the complexity, the language, etc. You need to find out and you won’t without asking. (FastSpring Note: FastSpring supports order page surveying.)

PARTNER. I can’t say this enough. Find companies who have products that don’t compete with your products but have synergy with your audience, and vice-versa. Offer their products to your users, your products to their users, swap space in your newsletters, chain installers (if you’re really brave), find ways to capitalize on your traffic by bartering it with someone else’s traffic. A good place to start looking is on your favorite file download site — put in general terms that describe your product and look at other products in the category that don’t directly compete.

Each of these are relatively simply ideas that will require only a small amount of time (and little or nothing out of your pocketbook) to implement. If you do want to invest not only time but money into your business, consider attending your nearest software/shareware related trade show, you will be amazed how much you learn, how many people you meet and how worthwhile the trip is. Have fun and Good Luck!

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