Buying a competitor

I didn’t write anything in this blog for a while. I guess it’s about time.

A lot of software-business related things happened lately. Most important was how I “tripled” my profit by buying competitor product. This competitor product is a freeware and is most known in my niche, even though this freeware is quite simple product in compare with my paid product, its website got massive amount of targeted traffic and is number 1 for tastiest keywords in search engines for my niche.

The only revenue source previous owner used was AdSense, which everybody knows is not much money. Before purchase, my AdWords Ad was showing in AdSense units of this website and was bringing me tons of traffic with amazing ROI around 400-500%. That’s why I decided I want to buy this website. I contacted owner and was trying to negotiate price, however owner wanted extremely big price for it. It is very common to overvalue stuff you own and undervalue stuff you want to buy – simple psychology.

So, I gave up because price was too big. But few months later some other guy contacted me with proposition to sell this website to me, I was suspicious at first since I knew previous owner and this was different guy. But very soon he showed me proof that he now owns this website and he bought it from original author. I really wanted to buy it, and I was sure new owner will want even bigger price for it, but after talking with him using Skype he named his price and I almost laughed. He wanted very small amount of money for this cool website; I wanted to say right away, SOLD! But it was smart to negotiate a bit more, so I lowered price for few more thousands of $.

Price was good! But it was still huge amount of money, but I knew it worth it. So, I created buy-sell agreement, we both signed it and I sent downpayment to owner. He transferred domain to me, sent me all sources and I paid him rest of the agreed amount.

Website is mine! Woo-ho!

But now I want my investment to be paid back. The gap between $0.01 priced product and freeware product and bigger than between $0.01 and $100. Everybody loves free stuff. Freeware promotes itself! But! Not everybody will be satisfied with freeware, some users will need more advanced features, and this is where you can make money from freeware: “By advertising a lot better, features-rich shareware”

Frankly, all I did was that I created comparative table between freeware and my paid product like this:

/	Freeware tool	Paid tool
Feature I	Y	Y
Feature II	X	Y
Feature III	X	Y
...	X	Y
Price	Free	Costs money

Also, I included promotion of my paid software inside freeware application.

After 5 weeks it paid back my investment and after that pure profit. Really quality traffic. I knew it was good purchase, but I didn’t realize it was so fucking good!

So, lesson was learned and I started to contact other freeware-competitors. How I suspected most of them named absolutely ridiculous prices. Would you pay $50K for 1 PR domain with 500 visitors per day? Of course, not. I realized that it is not very easy to buy a website, best scenario is when owner is desperate for money; in such case you can buy it very cheap – but when you’re contacting them – get ready for bullshit prices.

Of course some of them named good prices, and eventually after negotiations I bought them. Not all of them were good deals, for some websites I still didn’t get my investment back, but it’s all about time, eventually it will all pay off.
Right now I believe I own 60%-70% of market share in my niche. Monopoly, ha :)

In my niche I have only 1 decent competitor left, which I hate (because he’s competitor) and respect (since, he’s good at what he is doing). But it is even better; we’re always making our software better because of it.

I know you all want links to my product and know what niche it is. Sorry, folks. I had very bad experience about sharing it in the past and also I don’t see any benefit for me to share it.

Optimizing your website

Did you know that if your page will load 0.5 seconds longer you will lose 20% of traffic? Well, that’s statistics shared by Google, and I believe it is very close to truth.

Recently I came across cool Firefox plugin from Google called "Page Speed". This plugin analyzed my website loading and gave me suggestions on how to optimize my pages. Most important were 4 things:

1. Enable page compression using Gzip. Your web-server will compress pages on the fly and browser will decompress it on client-side. Decompressing is a lot faster than downloading large raw data and saves a lot of bandwidth. All modern browsers support Gzip, if not you can simply check it from PHP using this code "if (substr_count($_SERVER['HTTP_ACCEPT_ENCODING'], 'gzip'))"


2. Minify CSS and JavaScript files. You can reduce size of these files by removing whitespace and comments, sometimes it can reduce file size up to 50% of its initial size. This cool Firefox plugin can minify your CSS and JS files with single click. Also, you can minify your HTML page – however I didn’t do it, since my pages are generated with PHP and I’m editing them all the time.


3. Combine all CSS files into 1 file. Same with JavaScript files. My website is using 7 JavaScript files and 3 CSS. Combining them into as few files as possible cuts down on RTTs and delays in downloading other resources.


4. Optimize images size. This plugin somehow allowed me to reduce size of images without changing quality of images. This is especially good for large images.

After doing these 4 steps I decreased size of single page to 60%. Now, they are loading a lot faster and as a benefit it will save me and visitor some bandwidth. For doing all this I spent around 3 hours.

How to get less support emails

If your program is quite popular you will get a lot of support emails. I have full-time worker for technical support and because of specific of my products we get lots of emails. However many things can be easily optimized if you will look at statistics. So, which are the most popular topics?



1. I purchased from you month ago and I lost my serial number, can you please resend it to me?
2. Serial number you sent me is not working
3. Can your program do XXXXX?
4. I don’t understand how to use feature XXXXX?

These are most popular topics in my case. Now, let’s look at them in details.

1. A lot of people lost their registration info, what can you do? It is not a big deal to resend it, but if you’re receiving hundreds of such emails per day it will take a lot of time. Most online payment systems can be easily integrated with your website. In my case when customer purchased product from me - Plimus will send all information about purchase using HTTP POST method to link which I specified. All information about purchase (including customer name, email, serial, product, version, purchase date) is being added to MySQL database. When customer will lost registration info, he/she will go to my website and will try to contact technical support and he will find form for retrieving his registration information. He will need to enter only his email address and all registration information will be sent to this email, if there is a record with such email in our customer database. All fully automated!

2. Maybe it is hard to believe, but there are so many people in the world who doesn’t know what copy/paste is. They are typing serial number manually and of course making mistakes. Sometimes they can type O’s instead of zeros. Putting spaces in the beginning or ending. If serial number includes "-" some people can simply ignore it. My serial numbers looks like this: ABCDEF12-1234-5678-ABCD. And it needs to be entered exactly how it is. So, I tried to write code which will try to recognize serial even if it is entered not correctly. Here is Delphi code:

function CorrectLicenseKey(const Str: string): string;
begin
  Result:= Trim(Str);

  { Replacing O with zeros }
  Result:= StringReplace(Result, 'O', '0', [rfReplaceAll, rfIgnoreCase]);

  { Correcting - }
  Result:= StringReplace(Result, '-', '', [rfReplaceAll, rfIgnoreCase]);
  Insert('-', Result, 9);
  Insert('-', Result, 14);
  Insert('-', Result, 19);
end;

3. Simply by making FAQ or knowledge base and putting it to your website. You should help your customer to find answer to his problem before he will send support email. Gather statistic about which are most asked questions and answer them in details.

4. A lot of people really press F1. Include help with your application and make it very informative.

Try to answer customer’s question before he will try contact your technical support, make these information easy to find on your website, especially make links to it in "Contact us" form. It will not just save your (or your technical support team) time, but also will increase sales, since many people just shy to send you email.

2009 achievements and failures

It is February 2010 already and I forgot to write about last year achievements and failures
So here they are:

Achievements

1. Almost doubled profit (95% up) in compare with last year. What? Financial crisis? Never heard about it.
2. Released new product, which just generated its first $1000
3. Hired new employee full time (SEO stuff)
4. Successfully moved to another country (Cyprus)
5. Moved to cool luxury apartment at seafront
6. Really improved my English speaking skills
7. Visited 6 countries
8. Started this blog

Failures

1. Google ban of main website for about 2 weeks.
2. Still extremely lazy to organize my working time.
3. Hiring programmer failed.
4. Total fail with working with freelancers. From now on only translational jobs for them
5. Realized that Cyprus is not a best place to live, thinking about immigration to Britain or Canada.

Affiliates

I wasn’t writing in this blog for a while… Does anybody actually read this? :)

A lot of software authors are just programmers and they don’t know how to sell software. They are focusing mostly on creating very good piece of software which works smoothly and without bugs and they didn’t bother thinking about how to sell it until product is released.

So, the first thing they are doing after releasing their program – they are trying to find somebody who will sell for them for 20-30% commission. It is quite common – you can see it by browsing forums for software developers.

For whom it may work? For those having pretty complex software (hard to develop), quite unique and there is actually a market demand for this product.

For whom it will not work? If your program is small and there is a big competition on this market, why do you think somebody who knows how to sell software would like 20% commission and not whole 100% if your program can be easily cloned? Of course, we should not count only initial software development costs, but also support you give for each customer and maintenance costs and so on…

How to track affiliate sales?

Almost every software registration company (like share-it, Plimus, avangate) have they own affiliate tracking system which is quite easy to setup and to understand how it’s working.

Also, there are big affiliate networks like CommisionJunction and ShareASale. Which you can integrate with your payment processor for yourself.

Finally, you can write your own if you want to :)

Types of affiliates

Software directories and catalogs. Usually they make money on advertisements, but also affiliates sales are taking places. In most cases sales are just by chance there (random sales), they can generate quite few sales for you which can be easily counted by fingers.

Coupon sites. Websites that offering discount coupon codes for variety of products. They may also include your coupon codes. They will not bring you new customers; rather your potential customer who already decided that he\she wants your magical software will try to find coupon to buy your program cheaper and click on affiliate link. Anyway, coupon codes are quite good thing for spontaneous sales.

Other software developers. Software developers for whom your product might be good add-on for their own products. They can offer bundle of your + their product. This can actually work well, but there is very low chance it will last long if your product is easy to develop and support.

Freeware software developers. Owners of free software programs can put affiliated link on their website if your program is very similar to their but has significantly more features than their own software. For me it is working very well.

Cheaters and other bastards. There are really a lot of guys trying to take advantage of your affiliate program which will not help your business at all. Most popular is to buy AdWords on "your product name" keyword with affiliate link to it. So, you should be careful with these guys, and track almost each sale coming from new affiliate and check referral links to it and ban them from your affiliate program. Note, that sometimes ads are showing only to certain countries (US only for instance), so you may not see the ad if you are outside US.

Everybody else. There are a lot of bloggers or website owners who can put affiliate link on their page.

Conclusion

My opinion is that since overall software sales conversion rate is quite low, it is more profitable for website owners to use AdSense or affiliate program that converts significantly more than your software affiliate program. It depends on pricing of your software as well. It may work for somebody, but most of them will be disappointed.

As for my products, I have only 1 affiliate who generate more than $500 per month and one more who generate around $200. So, I would recommend not focusing on searching perfect affiliate for your software, but rather SEO which is far more effective.

Software localization (Part 2)

Recently I write about software localization and I think I missed some important things.

Bad things about localization

Accuracy

If you hire someone to do translation you will never know how accurate your localization is, unless you’re fluent in that language. You can check some words using online dictionaries or Google Translate, but it is machine translation and usually it will be even more inaccurate. It is always better to hire 2 persons, first for translation and second for proofreading.

If you hire someone to do that on freelancers websites usually you can see freelancers portfolio, their ranking, and reviews of their work – so it is good thing to hire somebody with better ranking.

Also, outsourced translation can be delivered in wrong encoding (it happened all the time if you need UTF-8 they will deliver ANSI and vice versa)

New versions of software

By making new version of your software usually you add some new controls, texts, hints, etc. They also have to be localized. It is very annoying.

New content on website

By adding new content to your website, you would also like to have pages in different languages to be up-to-date.

Other languages

Japanese

If you want to have sales from Japan you need to have Japanese localization. If you don’t have it I bet 90% of sales from Japan you got are from expats living there. Japan is a special case and Japanese localization is a lot more important than any other; I think I will write separate blog post in near future dedicated to selling software to Japan.

Danish and Swedish

I’m currently in progress of making localization to these 2 languages. Don’t sure if it worth it, the good thing it’s very cheap investment, so it is not expensive to try.

ProductName.com

When I was developing my first program which still is top seller, I gave it very nice name, which is perfect from all ways: it’s short, is it very easy to remember, nice to spell and read and it describe a little was product does. The problem was that domain productname.com was already registered. I was trying to contact owner of that domain to buy it directly, but without any luck.

So, I used my company website as product homepage and forgot about productname.com. One day I received email from Google Alerts that this domain name will expire in few days and there will be auction for everybody who want to buy it. I wasn’t sure I needed it actually, but why not? It couldn’t be that expensive anyway, so I told myself that I could pay for it $500 maximum.

I made a bid. I was the first bidder and my first bid was $20. 5 minutes later somebody else made another bid of $50, then I bid with $60 and so on. The last bid I made was something around $230 and then silence.

The problem was that at the day and hour bidding was ending I had a flight from Kiev to Larnaca, what a great coincidence … The is no internet connection in the plane of course, how would I know if somebody will make bid – win and will own this great domain name. Then I realized how much I wanted to win :) Gambling, ha-ha.

After reading help on bidding few minutes I find out that there was possibility to setup automated bidding system with maximum amount I want to pay and step was around $5. I setup $500 maximum and went to fly.

The first thing I did when I arrived at the hotel was checking email. I WON! YEAH! The price I needed to pay was $257.69 which was also including auction fees and 1 year domain renewal BTW.

I paid this amount, also paid for 2 other years of renewal and private registration services for hiding WHOIS information.

So, I spent $294.57 total for it. Not that much, don’t you think? But I was very curious was it worth it or not?

I copied web pages from main website to productname.com, but changed all internal links, also changed all links in program (Buy now links, homepage links in start menu, etc) so it was like OEM version, registered product on new payment processor, so I could see the exact amount of money this website will make. Also put AdSense on some pages. For all that I spend around 3-4 hours of work. That was all I did… ah, also put some links from my other websites to it and that’s it.

And what do think? In 2 months it paid for itself. And today is a little more than $1300 made directly from this website. Not much for 6 months, but I didn’t do anything special on it, just copied old content, maybe changed it a little.

Where all these sales came from? What was very shocking to me - that 70% sales were from direct traffic. Yes, people just typed productname.com in the address bar for some reason. And rest 30% sales were mostly from Google.

Cross-selling / upselling / bundling

I will try to show some good examples of cross-selling.
Here is the screenshot of Ashampoo order page:



Just look how beautiful it is.

Sending CD

Sending a CD to customer is not something new. Most of payment processors support this feature; also you can do that by yourself or by using services like SwiftCD or PingramCD.

2nd license

You can setup at your payment processor to send additional email with 2nd license key when this options is checked, also you can do that by automated email filtering, but I would not recommend doing that. I find out how to do that in Plimus in about 10 minutes. Works like a charm. Also for a second license I offer 50% discount.

Premium support

To tell the truth, we provide premium support for all our customers, I have full-time employee for technical support purposes. So, no additional script was even needed. I charge for premium support $9.95

Bundles

People buying your software are more likely to buy another product from you, and in case you have discounts for bundles chances to sell bundle are becoming higher and higher.

I noticed that 90% of people who are buying bundle with 3 products use only 2 of them and 3rd they don’t even install. Why they are buying it? Well, because of discounts of course :)

Here are some approx. stats that I would like to share with you. In my products (B2C multimedia software). There are 3 products (each product is good add-on to other product)

Their prices are A - $19.95, B - $19.95, C - $29.95
Discount are available – A+B = 10%, A+C=15%, B+C=15%, A+B+C=25%
Here are some stats. All data are approx.

Item	Conversion rate	Revenue $ (per 1000 sales)	Extra profit $
Bundle 2 products	6-8%	$2,520	$1,123.5
Bundle 3 products	5-7%	$3,144	$1,947
Backup CD	5%	$300	$300
2nd license	2-3%	$248.75	$248.75
Premium support	2-3%	$248.75	$248.75

Software and website localization (Part 1)

In this blog post, I would like to share my experience in software localization. I will not write any technical part of it, since I believe it is very trivial.

First of all it depends on your product, as usual. If your software product is used only by U.S. lawyers – translating it German will not help a lot, the same with some B2B products.
All my software products I have right now are widely used all-around the world. Let’s take a look at sales statistics grouped by countries and pick up top 10 countries with more sales. In my case the list is following:

Country	Language
United states	English, (Spanish in some states)
United kingdom	English
Australia	English
Germany	German
Canada	English, French
France	French
Netherlands	Dutch, French
Italy	Italian
Belgium	French, Dutch
Spain	Spanish

These countries generate 85% of all sales. Top 3 countries are English speaking and they generate more than 60% of all sales.

French

But, if you ever been in France, you couldn’t notice, how hard it is to speak with locals in English, they just refuse to talk if they hear an English word. How do you think? Will they use your English software? BTW: French language doesn’t cover only France, Quebec province of Canada and Belgium is also French speaking.

German

Germans are not that bastards as French are, but in most cases their English is not very good. Austria, Switzerland speaks in German. Also, in some countries like Poland or Czech Republic some people know German better than English.

Dutch

I love Dutch customers. They are buying bundles of several software products, backup CDs, etc. They never complain about some feature missing as much as Americans and Germans do, and what’s most amazing they speak English very good. But, having localized software in Dutch will still increase sales from Netherlands.

Italian

I would say Italian localization help as much to get customers from Italy as French for France. But, conversion rate is much lower.

First of all, localizing software is very cheap way to increase sales. Translating 6-8 Kilobytes of text from English to French will costs you around $30-$40 in freelance websites like oDesk, eLance, etc.

When I localized my first software program to French and German, I started to see a little increase in sales from these countries, but what’s more important, French \ German magazines was contacting me about including trial version in cover CD, they were writing reviews of my program, according to Google Analytics more and more French\German websites was referring to my page, etc.

As for $30 investment it sure pays for itself.

OK, localizing software helps to get more sales! That’s for sure!

What about website localization?

I think it is also very important if you want to get more international sales. Website usually has more content so translating will costs more. It depends on how big your website is of course.

First of all it helps people with bad knowledge of English to navigate your website, to read your content and of course it’s increasing conversion rate from these countries.

Search engines

By typing your product name in Google your website will be first in results. Are you sure it will be same in google.fr and google.de? Probably not.

Having localized website means you will have better ranking in local search engines. Some people even search with options "Show me only French content", that's means your English content never appear in results.

Currencies

People living in European Union would like to see prices in their own currency (EURO) not in USD. By showing prices in Euro on localized pages in German, French, Italian and Dutch means it will not decrease US sales at the main English order page.

Here are some statistics before and after localizing website to French

PLEASE NOTE: It is only French sales, other sales are not included.


#1 – Added French version of website
#2 – Google cached all that pages, French sales increased 1.5 times that month
#3 – French sales revenue is 3 times more than #1
#4 – French sales revenue a little lower than in #3 but is still 2 times more that in #1

The graph is almost the same for Italian and German languages.
But what didn’t work out for me was Spanish language. Really don’t know why…

Know where to run?

There are big expats communities in countries with strong economies: Spanish in US, Chinese and Russians everywhere in the world. What I personally noticed that having Russian localization doesn’t help to get more sales from Russia, but from Russians living abroad, you can see that by customer names, referring pages, top level domains in their emails (.ru), etc. The same story with Arabic

You need to try what works for your product best, and why not? It’s not that expensive to try anyway. I have no idea why, but French just love my products, I would never know that without trying localization, right?

Greetings to you from sunny Cyprus

German Keyboard fixing

This is German keyboard. It sucks! Unless you're German of course.



Noticed anything wrong with it? At first it seems that there are no differences between this one and classic English keyboard. Try to locate keys "Y" and "Z" :)

Well, you don't have to be touched by genius to understand how to fix it :)


And here we go, good keyboard:



Still some keys differ, but it is OK if you can type blindly.

How to lose "www." for your websites.

Did you know that some search engines think that http://yourwebsite.com and http://www.yourwebsite.com and two different websites? Let's say your website have 500 links to it with "www" part and 5000 links without, why not make it 5500 links?

If you're using Apache as a web-server and have mod_rewrite module, you can do that by simply adding this code into your ".htaccess" file:

RewriteEngine on
RewriteCond %{HTTP_HOST} ^www\.(.*) [NC]
RewriteRule ^(.*)$ http://%1/$1 [R=301,NC,L]

Now, all pages with www prefix will be automatically redirected (301 - permanent redirect) to the pages without www.

Uninstall survey

I'm using InnoSetup as installer builder for all my software products. And there is very nice plugin for it, called Uninstall survey, when user is uninstalling program it just ask him "why?". Everything user will write there, will be sent to my server and then I'll receive it by email.

Sometimes, it works very well, potential customer don't know how to do something, writes about it and leaves his\her email. After reply, sometimes they are buying program. I can't say I earned a lot by this survey, but few hundreds bucks was definitely earned.

Sometimes, I receive very fun feedbacks. Here is the most hilarious:

Uninstall reason: Other reason (see below):
Its probably not against the law to write a short, person to person note to someone you will almost certainly never meet. Hello. How are you?

Business first.

So, basically, the reason I want to uninstall this program is because my damn computer was full. Yes. The hard drive had about 100 mb left on it, and i needed to cut the crap.
This program was an obvious choice, because basically there's a lot of free programs which do the same things for free and without limit. If I ever need it again for anything, I expect I'll just download it, use it, then get rid of it again.

I wonder if anyone reads these at all?
If you did read it, I hope I have touched you in some way. Well, not really. You can probably tell that I'm bored, and, as a favour to you, am making you slightly less bored, by giving you something interesting to read. Well, not all that interesting, now that I think about it, seeing as I'm not really talking about anything of interest.
Do you like your job? Is this all you do? Just read the 'I want to uninstall software because:' customer responses? Day after day? Probably not. You're just a member of the customer service department. Or something.

I could be dead right now. You'd never know. You could be reading the last will and testament of a dead man (yes, you knew I was male). I could have finished writing this, sent it off, and then immediately suffered a heart attack.

Maybe you're not even reading this. Have I wasted all this time just writing a letter that will never be read by anyone, simply because they got bored halfway through and moved on to the next one?
If you did read the whole thing (come on, its really not that long), then dont just let it be lost. Save it in a notepad file or something...look back on it and smile when you've had a long day reading boring customer responses.

Cheers,
Your friend,
The Unfaithful Customer

Blackberry mobile

If you are developing or planning to develop software programs for Blackberry mobile devices, you might find this article very interesting, with all stats and sales data.

About me and why I started this blog

I’m 23 years old, born in Lviv, Ukraine, currently residing in Limassol, Cyprus. I own several software-related businesses. Internet businesses made me very mobile; I can live and work in any place in the world where there is internet connection. I’m not a milioner, but I’m pretty wealth and I can live in good comfort in any place in the world. Most of the work I do myself, I have fulltime technical support worker, my wife is artist and she helps me with graphical design stuff. Routine work or work I don’t like to do is done by freelancers. I don’t work much, like 5-6 hours per day.

I started my software business 2.5 years ago, it’s very young company. Before that I was working at a big software-outsourcing company for 6 years (yes, I was only 15 when I started) from there I get all my programming experience, I was participating in many projects and I have very wide experience. I can code on most of programming languages, I understand network and web very well. In spite of all software programs I sell are for Windows, I was working for a long time (not for so long actually) with Unix-oriented systems (I was working with Solaris (Sparc & Intel), IBM AIX, and many more platforms).

I don’t have any degree or diploma. Everything I know about computers and programming I learned for myself. I tried to finish university, but it was very hard to me that some not-friendly-person trying to teach me something I already know better than him\her. Also, I find that a big waste of time.

I like programming, but after doing that for many years I understood that it is not what I’m really up to. I like to sell software and marketing it over internet. That requires more analytic view and deeper thinking. At least for me it works this way.

I started this blog, because I don’t know any person who sell or would like to sell software online. Most of my friends have regular jobs or run different kind of businesses. So, my head is full of ideas about shareware and internet business but I don't have any to talk to about that. I found some blogs of shareware owners, but 80% are not serious players, they just sell software as a hobby or they don’t do any marketing at all.

In this blog I will write about some shareware tips & tricks, related ideas, and everything else related to the selling of software over internet and owning internet business.

This blog is second try. First one got 3 posts, and after that I was too lazy to start posting again. I hope that this blog will have better future. Feel free to leave comments here. I speak Ukrainian, Russian, English and Polish. But I prefer to use English in this blog.

Price segmentation

I was very inspired by article about price segmentation by Joel Spolsky. And definitely wanted to do some research work with prices for my products. One of my products fitted well in that category because it was used by home users (B2C) and companies (B2B) as well.
Some features in that program used by companies were not used by home users. Anyway, I split product into 4 different types of licenses each representing a separate product. Let's call them (Home license, Extra license, Business license and Enterprise license). Differences between them were simple disable of some features:

Features	Home	Extra	Business	Enterprise
Feature #1	YES	YES	YES	YES
Feature #2	NO	YES	YES	YES
Feature #3	NO	NO	YES	YES
Feature #4	NO	NO	NO	YES
Price category	Low	Medium low	Medium high	High

So, I didn't write any additional code, just disabled some functionality. A lot of software companies use this scheme by providing "Family pack license", "Educational license", "License for personal use", "License for business\commercial use" and so on.
As you can see even Microsoft is using pricing segmentation for its Windows operation system (just look how many types of different licenses Windows Vista have).
In case you are curious about some statistics, here are real stats of my experiment:


As you can see "Business license" appears to be most unsuccessful :) Anyway, whole this price segmentation experiment was very successful; almost half of revenue is generated by additional licenses.

Domain by IP

Everybody knows what "whois" is, right? You can check current owner of the website, if it's not protected by services like domainbyproxy.

Have you ever wanted to know what other websites your competitor host on his server? I did. Found several services which can show you domain names hosting on the same IP address.

http://domainbyip.com/
http://www.yougetsignal.com/tools/web-sites-on-web-server/

None, of them showed all websites I have on the same IP, but it was pretty close. By googling IP address - will also show some results.

Better looking pricing. A little increase in profit

More than 40% of our customers are not paying in United States Dollars, but other currencies. The most popular currencies after USD are Euro and British Pound. As far as I know most payment processors support automatic currency conversation when customer change it in the payment options.

Some software companies I saw on the internet use currency cheating (let's call it pricing segmentation). For example product A costs 19.95 USD for the IPs located in United States and if your IP address is European the price you will see will be 19.95 Euro (approx. 26.94 USD for today). I don't like this scheme, and I will never buy anything from such company, because I don't want to pay more that somebody else.

The method I personally use and would recommend to everybody is to make price look a little better for every currency. For today 19.95 USD is approximately 14.26 EUR. But will customer purchase your product if you'll change price to 14.95 EUR - probably yes. And it looks a little better IMHO.

According to Wikipedia there are 182 currencies currently running in the world. Changing every currency in your payment processor would be a really pain in the ass and would take a lot time. In Plimus payment processor you can make this currency rounding for each currency by few clicks.

How to do that?

1. Go to the product contract "General information" section.
2. Click more currencies.

3. Select the "Rounding method" to the method you like the most. As on picture below:

4. That's all

Conclusion

Let's make a simple calculation. If your product costs 19.95 USD and you sold 1000 copies of software. 270 were in Euro payment and 100 were in GBP. And 30 copies were sold in other currencies but we will skip them due to low amount :)

Currency	Value	Rounded value	Copies sold	Extra profit $
USD	19.95	19.95	600	0
EUR	14.26	14.95	270	$252.36
GBP	13.04	13.95	100	$133.01

Now let's make a time-invest table

Action	Time spent
Reading this article	10 min
Making decision to do this trick	5 min
Changing rounding method in Plimus	5 min
Any changes you will need to do in case exchange rate of currencies will change	0 min
Any actions on this in future	NO

Well-well, what have we here? Simple calculation shows you can earn more $385.37 per each 1000 sales with one-time invest of 20 minutes.