

Do deals site work for software? - njbox

Without mentioning my software here is the story of my experience with a recent promotion at a daily deals website for software.<p>I recently launched my software and have been making on average 1 sale per day. The price is around $100.<p>I have not done any heavy marketing yet and still improving the software so I am thinking what if I can sell my software at a lower price point, will it attract more users?<p>So I went to this deals website and found through previous testimonials that the best way to gain more if you could price it around $20<p>So cutting the long story, I decided to do the deal promo at 80% discount and the deals website takes 50% of the revenue. So for every sale I make $10.<p>Since the deal was only for a day I thought of experimenting.<p>The deal went live @12 in the midnight. By the morning I woke up, I had 10 orders in my inbox.<p>Since then every hour sent around 2-3 orders.
By the end of the deal time, I ended up with a total of around 30 orders.<p>Now let us crunch the numbers.<p>My total profit on 30 orders = $300<p>My total profit on average on a regular day = $100<p>That seems a good decision right?<p>Let us talk about the support time.<p>It took around 6 hours of my total day time (if you add up all the time) to monitor the deals page for customers asking questions and sending registration codes. Yes there were lots and lots of questions from users and I was readily answering them.<p>so if I value my time at all and put it at $50/hr then the cost is around $300 worth of support time.<p>being self employed and working solely on the software gives me the liberty to tweak my hourly rate to zero and make me feel good about the deal or raise it higher and make me feel bad about it.<p>But the deal thing provided lot of insight.
- At low price point the software sells like fire
- Users really want the software
- Hopefully they will talk to their colleagues and buy more licenses 
- Generate more traction<p>Next time, may be I will do the deal at a little higher price point and see how it goes.
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puranjay
Here's my take: you want to do something like this for software (indeed, any
business) only if you have a way to follow up and tap that customer for future
promotions.

Do you have some additional software you could pitch him after he's made the
purchase? Are you getting his email for your autoresponder?

These are important questions to ask. Otherwise you are just devaluing your
own product by selling it at such a steep drop.

Say, if you were running a small bakery, then you might be willing to sell
your wares for less because of the word of mouth publicity that a few extra
visitors from beyond your usual customer base could buy.

If you are selling software, you want to do it if you have different stuff to
sell and want to use a daily deal as a gateway to lure in customers and pitch
them other products after the sale has been made. Say, you are Adobe and you
want to sell Photoshop. You do so by promoting Illustrator at a steep
discount, then telling them about Photoshop at the checkout stage or emailing
the customers about it. Then, it can work out as a good deal. Otherwise, not a
very good idea.

