Shareware Beach

Thursday, 14 June 2007

Silly Anti-Fraud Policies Cost Business

Filed under: Marketing — Jan @ 16:55

Last week my wife said she wanted a Sudoku game for her new Pocket PC. So I went to Handango, downloaded a few that seemed nice, picked the one that looked best, and clicked through on Handango’s site to order via PayPal. I got this:

This recipient does not accept payments from non-U.S. PayPal accounts

I don’t know why Handango won’t take my money, but I can only assume it’s some misguided anti-fraud policy. It’s not like they don’t sell abroad at all, because the credit card payment option on their site lists all those countries you’ve never heard of.

For a business that also accepts credit cards directly, nearly all PayPal fraud will come from accounts of phishing victims. That’s certainly my experience. In case of software downloads, it doesn’t matter to the thief which country the PayPal account is in. To defraud Handango, he just needs to hold on to his phishing line a little longer until an American fish bites.

A quick tally of Just Great Software’s PayPal orders shows that in 18 months, we’ve had 26 fraudulent orders through PayPal. That’s certainly not enough to worry about. 23 of those were with U.S. accounts. Blocking U.S. accounts and allowing foreign accounts would be more efficient at stopping fraud. If you say that it would also stop a lot of orders (but not all, as there’s the direct credit card alternative), that’s exactly what blocking foreign orders does too. Non-U.S. fraudsters are smart enough to use U.S. proxy servers and what not to evade your anti-fraud checks. But honest customers usually don’t want to or simply can’t go through such trouble. (There’s no way I can have a U.S. PayPal account.)

So what did I do? I paid with PayPal. Directly to the developer. I didn’t want to use a credit card because I have dollars in my PayPal account, but I don’t have a credit card billed in dollars. Saves me on currency conversion. It hardly matters for a $14.95 game. And, frankly, it’s quite offensive to be classified as a foreigner, even if I am. I work hard and pay my bills on time just like every average American.

In the end, wife’s happy, I’m happy, developer’s happy, and Handango sends me an automated email wondering why I didn’t pay. Duh!

Unless your fraud rate exceeds your profit margin, indiscriminately blocking orders costs you money.

Wednesday, 15 November 2006

Microsoft adCenter First Impressions

Filed under: Marketing — Jan @ 8:40

Two weeks ago I set up an account with Microsoft adCenter, and set up my most successful campaign just like I have it on Google Adwords. This couldn’t have been any easier due to the fact that Microsoft’s system is very similar too Google’s, down to the number of characters you can use for your ad title and text. With one improvement though: Microsoft allows 1*70 characters for the ad text, while Google insists on breaking it into 2*35. This may seem like a small difference, but 1*70 is way more flexible than 2*35 when you’re using words with more than one syllable.

I only set up one campaign because I wanted to gauge the kind of traffic I’d get before spending time to set up all the campaigns like I have them on Google. Microsoft has step by step instructions for importing campaings from Google, but I gave up on those when they tried to explain me how to edit the .csv exported from Google in Excel. Copy and paste between two browser windows (on two monitors, of course) turned out to be much easier.

Two weeks later, the first impressions are in. All 1,798 of them. Ouch! In the same two weeks, my Adwords campaign got more than an order of magnitude more impressions, with a similar click-through rate. And that’s counting the Google search results only. Content targeting gets way more impressions, though also a much lower click-through rate.

Since there’s no minimum spend on Microsoft adCenter, beyond a $5 or €5 sign-up fee, I’ll just keep the campaign running as it is. But I’m not going to spend any more time on it until Microsoft starts generating some traffic. Even Yahoo! Search Marketing does better.

Wednesday, 1 December 2004

Line Extension Good or Bad?

Filed under: Marketing — Jan @ 7:24

Scott Miller points out the absurdity of Diet Cherry Vanilla Dr. Pepper. He argues the big soft drink manufacturers have gone way too far extending their brands. This makes them vulnerable to a smaller player touting their single drink as “the real thing”. The irony that this used to be Coca Cola’s slogan will only enhance the smaller player’s campaign.

If you’re still in doubt that using the same brand name for different products is a bad idea, here’s some additional evidence. Here in Thailand, I can buy Coke, Diet Coke, Pepsi, Diet Pepsi, Sprite, 7-Up, Fanta, and three flavors of Miranda. That’s right: almost none of the line-extension flavors are available here. Even the soda companies themselves implicitly admit that all those additional flavors make no sense. If they were profitable, they’d be available all over the world. And if you argue that Thailand is still a 3rd world country, the situation back in Belgium is almost the same. Miranda is not avialable at all, and instead there’s three flavors of Fanta.

How does this relate to shareware? Something I often read in discussion forums is the “advice” to split a product into a Lite and more expensive Pro version. Something I read just as often is the experience that when somebody does this, almost everybody buys the Pro version. If that is so, then the Lite version should be eliminated. It will increase sales, and reduce customer confusion. A single product or brand cannot be everything to all people.

A piece of software can’t be the best hobbyist’s tool for occasional professional use by experts who use it 10 hours a day. If you send out that kind of message, people in all 3 target markets will think the product is primarily aimed at the other two, and will buy a competing product that only targets their own demographic. Unless all your competitors are doing the same thing, and there’s no way for customers to escape confusion. But sooner or later somebody is going to get smart (or just lucky) and make a big splash by really satisfying one third of what you thought is your market, but is really three markets.

Line extension isn’t always bad, though. If the target market for a variant of your product is very small, a separate product may not be viable. However, even then, be careful. It may be wiser to offer the additional functionality as an add-on or plug-in that can be purchased on top of the original product. Then people who don’t need it, won’t be confused by different versions of your product, since there are none. However, do expect to get requests for and to develop additional plug-ins for other market segments. Otherwise, you still run the risk that people will think you’re only targeting that segment.

HelpScribble has always had some extra support for Delphi developers, simply because that’s my development tool of choice. I used to advertise this quite heavily on HelpScribble’s web site. The result was that people thought HelpScribble was only useful for Delphi developers. Not true. It generates standard help files, compatible with all Windows development tools. So now HelpScribble’s web site takes about most of the popular Windows development tools, and Delphi is just one among the list. Unless you click the Delphi link on the web site, you won’t know about the special support.

Don’t assume people will actually read your marketing stuff. They’ll just glance over it, and remember what catches their attention. If you mention your favorite development tool 7 times, but never mention the one the prospective customer is using, they’ll draw their conclusions, correct or not, and move on.

The only line extension you’ll find among JGsoft products is EditPad Lite and EditPad Pro. The Lite version is freeware, and aims to seed the market. My thinking is that since there’s a wide choice among freeware editors, it’s a good idea to provide a free version of EditPad as well. People using EditPad Lite are more likely to upgrade to EditPad Pro than to another text editor. The Lite version is definitely generating sales for the Pro version. But the Lite version is also definitely stealing sales from the Pro version, when people decide that Lite is good enough for them. Overall, I believe the balance is positive, given the fact that there are so many alternative “lite” editors. But if there weren’t, there wouldn’t be an EditPad Lite either.

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