Coming up with a microISV product idea.

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This final 47hats.com tip for microISVs for the month of August has to do with a question that gets asked often at the Business of Software Forum: How do I come up with an idea for my microISV?

It’s damn hard, no doubt about it.

In some ways, the answer to the question “What product should I do?” is really bound to what you’ve done in life, what your values and passions are.

It does seem sometimes that all the good ideas are taken – and sometimes when you see some new innovation to think, “Damn! Why didn’t I think of that and build that app?” But that kind of thinking gets you nowhere whatsoever.
Coming up with a product idea is a specialized instance of innovation in general. I’d submit that innovation happens at the edges of established practices, markets, ideas and ways of doing things. Not at the center of those.

Consider for a moment two very different cases: micro loans and the iPhone. Microloans came into being because the established lending practices in developing countries – and poor parts of developed countries went so far and no further.

The iPhone is a different case obviously. There, Apple did not set out to build (another) better phone, it set out to build the Apple way of looking at the cell phone experience.

I’d suggest the quest to find your microISV application idea starts by looking at your own resume. Think back to each job, situation, organization. Where and what are the unsolved problems at the edges? What problems will those companies, industries, entities face in the next 3 years?

Next look around at your life – current work and personal life: what things do you wish for? What problems do you see? What conventional ways of doing things fall short?

After you’ve accumulated a list of ideas and possibilities, you have to have a heart to heart conversation with yourself: Which ones do *you* care about? Not which ones will make you the most money, not which product might be most attractive to some other company who will buy you out. Not even which application or product do people most want or most need.

Creating a commercial-grade application and doing all the things you need to do to be successful is a damn lot of work. The fuel to make that fire burn bright through all the long nights of lonely work will be an idea that grips your imagination and that you are passionate about.

Nick Hodges of CodeGear talks about CodeGear, Borland and Delphi

The MicroISV Show goes where blue badgers fear to tread – to the home of CodeGear, the Borland spinoff of all things Delphi, to get get the lowdown on what today’s other windows development environment has to offer microISVs. Nick Hodges, codegear product manager for Delphi makes the case and spills the beans.

While the audio version went up a couple of weeks ago, Channel 9′s makeover in progress delayed the action video ’til today. Enjoy!

A tiny favor to ask: Vote for me.

Vote Button
You may have heard about the upcoming Business of Software Conference (10/29-30, San Jose, CA), and my first (extremely, horribly bad) video effort to win through your votes a speaking slot there.
It was so bad it would have been banned by the Geneva Conventions (assuming we still follow them). So bad, I asked Neil Davidson if I could replace it with a new effort. Neil was kind enough to let me take the old video behind the digital woodshed and send it to a better, happier place and put up my new video, which I did yesterday.

The new video combines cutting edge images – supplied by other people – with little tiny words that work on television with a new plan of what I can talk about during my 18 minutes of fame: how to write a blogging plan for your software company or product.

In the process of retiring my first video effort, my score (fairly) got reset to zero, zip, zilch. And because it took me a month to get up the guts to point a camera at myself again, there’s only a few short days before voting closes.

So here’s the small favor I’d like to ask you:

Go to http://www.businessofsoftware.org/softwareidol.aspx, find my video, click the rightmost star under it and vote for me. You might even want to spend two minutes watching it – others braver than me say it’s actually quite good.

After the conference I’ll post my presentation here as a series of major posts with more detail and the presentation itself if I can at YouTube.

I hate to ask for favors, but I’d really appreciate it if you could take a minute and vote for me now.

The real costs of buying your software

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Over at the Business of Software forum, there’s been a more than a little angst this summer over whether microISVs can compete with Free and Open Source (FOSS) software. After all, we have to charge for our software or go broke; there are a lot of really good FOSS apps out there; Microsoft is worried, Google keeps releasing “free” apps like Gmail – what’s a microISV to do?
Don’t worry, be happy and charge less than what FOSS software costs.

Now before you begin to wonder if Bob has been drinking too much fine Sonoma County wine, consider: your customers damn well know that every piece of software they buy costs them in three different currencies: money, time and emotions, and of the three, money is often the least important.

It takes time to install, configure and learn even the rudiments of a software application. That time for all but perhaps enterprise software where the people who pay the time aren’t usually lucky enough to be making the buying decisions, is often worth multiples of the money that changes hands.

But there’s a more subtle currency in play when acquiring software, or most anything else: the prospective customer’s emotions. For new cars, it’s all about being strong (trucks), being better than others (luxury cars), being different (Minis) and being safe (Volvos).

For software, for the average buyer, it’s whether or not this stinking thing is going to make me feel stupid, frustrated and angry with myself. While there are other products that extract a high emotional cost from their customers – notably cheaply made consumer electronics with piss-poor manuals, no tech support and that go dead in a week (yes, I’m talking about you, oh wireless headphones I’ve spent 2 hrs with trying to make work today!) – software takes the cake, gets the prize and drives more people crazy in this world by far. How many times have you felt like punching out your computer – and you’re a developer!

It doesn’t need to be that way. Especially for microISVs, where the software developer is often the person who decides what gets built, and how, and sets the cost in all three currencies.

This gets me back to FOSS software – great stuff when it works (Firefox), pure hell when it doesn’t (Firefox). Software that can become temporal black holes, sucking up hour after hour of your time yet emitting not one bit of productivity.

You as a microISV can do a lot more to make your software cheaper to buy for your customers while incidentally beating out FOSS competitors, charging as much (or more) money as you do now and making the world a tiny bit easier to live in. Here’s how:

  • Start with your Site: how much time and how much frustration does it cost? Every click a visitor needs to make to find out what your software does, what it costs, why they should buy it and what kind of company backs it just raises the cost in time and frustration of buying your software. You may have had a really good reason a few years ago why you buried your price 3 clicks deep – that reason doesn’t hold water in today’s net-savvy online marketplace.
  • Next is getting the software: what’s the time and frustration surcharge for downloading the trial version, making the purchase, getting upgrades? More to the point, why oh why are you making your prospective customers jump through hoops by having to supply you with their email address, let alone filling in a another pointless waste of time registration form? Bad. Bad Bad.
  • Now how do I use the fracking thing? How many times have you downloaded an app, eagerly installed it, gotten all excited about using it, only to smash your face straight into a brick wall of an interface that gives you not one clue of how to get started? Too many times. Or how about whacking into one of those devil-spawned cute little “Tip of the Day” tips that is utterly incomprehensible gibberish because you are still trying to figure out how the program is supposed to work? In the age of YouTube, there’s no reason you can’t make a two minute screencast and show your prospective customers how to get started with your product. In fact, I’ll predict that in a few years there will be two types of software introduced – those with YouTube intros and those that don’t sell.
  • Find annoyances and kill them dead. Ask your current customers one simple question: What little annoyance does our software have? Don’t be judgmental, defensive, or promise you are going to change the app just because they want you to; but for every customer that tells you about a specific annoyance, there’s ten – or a hundred – that hit the same issue.

Finding out what bugs your customers about your site, their out-of-the-box experience with your software and how they experience your software long term is smart. And then making these time and emotional costs go away is an easy, smart way to lower the cost of your software and improve your competitive situation.

[tags]microISV, FOSS, Open Source[/tags]

One (extra) hat you might not need to wear

By Cristian Dorobantescu
Affiliate Network Coordinator / Avangate BV

Bob says that a (Micro) ISV owner has to wear about 47 hats to keep the business running. I have to agree with Bob on this one, as from my experience in working for and with (Micro)ISV, 47 it’s just about the right number of hats!

Still, there is one hat that an ISV owner might not need to wear (if they already use an Electronic Software Distribution company like Avangate, Regnow, Plimus or Element5 to run their sales), and that is the Affiliate Marketing hat. I know, I know, most ISV don’t trust Affiliate Marketing so let me get you through 3 steps: 1. what it can do for you, 2. Nailing down the reasons why (Micro)ISVs don’t always run Affiliate marketing and 3. Why you don’t have to wear an (extra) hat for it (because the ESD companies will wear it for you).

1. So let me first tell what Affiliate marketing can do for you:

  • Download portals, discount sites, reviews, blogs and editorials. They all work, one way or another, based on an affiliate business model, getting commissions from affiliate sales. If you want them, you need to enable affiliate marketing for your products.
  • Efficiently outsource Marketing and Sales efforts while you develop the products. ISV are started by technical people most of the time, who then try to wear a sales/marketing hat while coding. I’m not really a technical guy but I can say that the actual product development takes a lot of time and resources. Then why not outsource some of the marketing and sales efforts to some guys (the affiliates) that should do it well enough to make a living from it? After all, affiliate marketing it’s based on efficiency, you don’t have to pay for it unless it generates sales / makes money.
  • Having multiple storefronts for your products. You can’t expect that every potential customer for your product will know about you and get to your homepage. So having your product on sale in multiple places greatly improves your chances to have that buy button clicked on.

2. Let me see if I can further narrow down the target for this article; if you aren’t already using affiliate marketing to help your sales and marketing you are probably in one or more of the following categories:

  • You don’t think affiliates will bring you money. Still, they have to make a living out of it, so they need to actually make some sales somewhere. It can be for your competition or for you, what would you choose?
  • You don’t want to share the profits with affiliates (after all, they just place a buy button on their site, while you did all the hard work). Truth is that if they just place a buy button, they will never make a sale, so you don’t have to worry about sharing your hard earned money with them, the lazy bones. And if they make a sale, it just means they did more than ad a simple buy button.
  • You are afraid of affiliate fraud or you don’t have the knowledge to manage the affiliates. This actually gets me to the part with the Hat you might not need to wear, because we can do it for you. See below.

3. Affiliate Marketing is the (extra) hat you don’t need to wear on your own because:

  • The Electronic Software Distribution companies are ready to wear it for you: they are providing you with the technology, tools and know-how to run affiliates
  • You don’t have to worry about writing checks every month or the legal burden of having contracts, because EDS will do it for you.
  • You get instant access to an already established network of affiliates. They already know how to work with the system, and most of the time they get all the info they need from the products details you use for your own regular sale process.
  • Tracking the affiliate sales is done by the ESD company in fully secured conditions. They have advanced systems to prevent fraud and keep things under control.
  • You get all the tools and the business model to make things efficient.
  • So before going crazy with all the hats you have to wear, just think about the ones you might get other people to wear. If you don’t do affiliates already, it’s easier than you might think and it’s good for your sales.

PS: that’s me wearing the affiliate marketing hats for you :)

me

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About the author:
Cristian Dorobantescu has been involved in international software sales since 2002, with a special interest for online sales. Currently the Avangate (www.avangate.com) Affiliate Network Coordinator, he has previously worked on distribution channel development and online sales for international software companies.

The Silverlight is on Microsoft’s new search tool tafiti

If you dismissed Microsoft Silverlight as a technology you didn’t need to track, you might want to go over to http://tafiti.com – Microsoft’s brand new search engine interface written in Silverlight.

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I happened across this item at Techno//Marketer (thanks Matt!). Matt Dickman does a very nice job on a screencast walking tafiti (which means “do research” in Swahili) through it’s paces.

While tafiti is very much a beta and broken in parts, the interface makes searching across the web, RSS, images, news and more dirt simple and fun. You click one of the icons on the left, see the results and can drag items off to the drawer on the right. There’s an alternative treeview interface that is pulling up a load of microISV links I’ve not seen in a way that make it easy to browse for items that catch your eye and open them in separate browser windows.

Now is this anything more than a pretty eye candy interface on Microsoft’s search web services? Nope. But its a really cool interface – and if they hammer out the bugs it might, maybe, give you a reason to try Microsoft Live Search. I would be very interested in seeing tafiti for Google.

And by the way – Matt reviewed tafiti on his PC naturally enough, and wasn’t wild about the fact that like using Flash on a new PC, Silverlight had to be installed. When I went to tafiti.com, that install took 20 seconds. That was on my MacBook Pro.

From tafiti’s FAQ:

“Tafiti is a Silverlight application and supports all currently supported platforms for that technology.

On Windows Vista and Windows XP SP2, this includes Microsoft Internet Explorer 6, Windows Internet Explorer 7, Mozilla Firefox 1.5.0.8, and Firefox 2.0.x.

On Apple Mac OS X this includes Firefox 1.5.0.8, Firefox 2.0.x, and Apple Safari 2.0.4.”

[tags]microISV, silverlight, tafiti[/tags]

Deep Discounting and One Day Sales

by Ellen Craw, Ilium Software and Bits du Jour
[Editor's Note: This a 47hats.com Vendor Profile, where I invite someone from a company that I think has something interesting to offer microISVs to make their pitch here. Interested in doing the same? email me at bob.walsh@47hats.com.]
Thanks, Bob, for letting me post. I’m writing to introduce Bits du Jour – a “one deal a day” site for Windows and Mobile software.

If you haven’t heard of one deal a day – it’s a very popular trend right now. Started in 2004 by woot!, there are now over 150 sites that sell one thing only, each day, for a big discount and in limited quantities (see a complete list).

Bits du Jour takes this approach and applies it to Windows and mobile software. It’s a great way to get your title in front of a few thousand people who wouldn’t see it otherwise. And the limited-time big discount means that people who are interested will try it fast, rather than putting it in their “do this sometime” pile. We all know how few of us ever get to that pile.

I’m a big fan of deep discounting for software titles, if it’s done carefully. Offering big discounts too often will devalue your title. But doing it occasionally is a great way to get people off the fence about making a purchase, or even about installing a trial. Bits du Jour isn’t the only way to offer a big discount – if you have something to celebrate, like an anniversary, or winning a big award – a big discount on your own site is a great way to draw attention to it, and make additional sales as well. But if you don’t have a good reason (or excuse), using a third-party site gets around doing anything that looks like just lowering your price. And Bits du Jour gets a different audience than your own site will. People go to your site because they’re looking for your specific kind of product. They go to Bits du Jour to find a bargain, or an idea for software they might not have realized they need.

Will you make much money giving a big discount on your product? Probably not. Bigger discounts sell more, but of course they make less per sale. But you’ll get more users for your product, which translates to more people you can sell upgrades and add-ons to. From an SIC 2006 presentation: people who have already bought one of your products are seven times more likely to buy another one than someone who has never bought anything from you. If you send emails out to your mailing list, current customers are thirty times more likely to respond to the promotion. You can easily turn sales you make into more sales.

And there’s no cost to you – whether you have the sale on your own site or use Bits du Jour. BDJ works as an affiliate, directing sales to your own cart, so just gets a commission on any sales it makes. There’s no upfront cost – and very little work – for you.

You can get complete information on the partner area of Bits du Jour, and of course I’m happy to answer questions as well. And for Mac developers – check out MacZot, a similar approach for Macintosh titles.

Andy Brice makes Slashdot Front Page

By Bob Walsh

Andy Brice today the front page of Slashdot and has been jackpotting all over the Net at reddit, digg and elsewhere. Why? Because Andy turned on the lights on a stinky little cockroach of a secret in the online software industry: a lot of “5-star” software download sites awards are bs-lies. His post as of now has 158 comments and trackbacks. Tilt!

Andy – Here’s the other dirty little secret you’ve come across: you’ve done some real muckraking and the world is hungry for it!

There used to be a time in this country [The USA] when people called newsmen and newswomen would go out and cover some dirty secret that people had a right to know. Sometimes it would be very big – like Watergate. But for every Watergate, there were a 1000 City Council gates, 1000 little candles of darkness where one group of people connive money, power or influence from others.

Were being the operative word.

I hope you – and other bloggers, microISV or not – do more posts like this! Please let me know – as one (ex) investigative reporter to another – if you need any help re how to nail bastards who need nailing. Blog On!

Be bold when you blog!

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[A 47Hats Tip.]

Andy Brice did it today in the U.K. Collis Ta’eed did it today in Australia. Maybe it’s time you did it in your microISV’s blog. Today’s 47hats.com tip is be bold when your blog.

Take a stand. Make some noise. Kick up a ruckus. Muckrake. Kick some ass. Lead.

Blogging is no place for watered-down marketing blah blah. It is a place where you can make things happen.

For example, Andy Brice nailed 16 bogus software directories that hand out “5-star” awards to each and every microISV application that crosses their door.

On the other side of the world Collis Ta’eed kicked off Blog Action Day – an effort [already gathering steam] to focus the power of attention of the blogosphere on one subject – the environment – on Oct. 15th.

Never using your blog in a bold way tells the world you are afraid. Afraid of offending someone, somewhere. Fear – especially pointless, useless vague fear – has no place in your life if you’re going to be a successful person.

Want a business reason for being bold? Consider these stats from Andy today:

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Need another reason? Consider the words of Brian Clark, the man behind top-rated Copyblogger.com:

If you don’t mind being just another blog among millions, just keep talking about the same thing. But if you want to make the Technorati Top 1,000 (I did it in five months, and got to 11,000 subscribers and 1 million page views a month in that period), you have to find a way to get noticed. You have to stick out from the crowd.

How do you get noticed? You gotta be bold.

There’s no other way.

-From Go Big or Go Home: Why Being Bold is Critical to Getting Noticed

So take a moment, look up from this screen, and ask yourself: What will you be bold about on your blog tomorrow?

Attention – sea change in progress.

When Seth Godin speaks, wise microISVs listen. Seth’s latest post make a simple, compelling point:

People that would never read a 200 page book will happily watch a three minute video. Here’s a page with a dozen or so videos to get you started.

Seth’s right – video is by far the most convincing way of remotely talking with people. And definitely check out the page Seth make at Squidoo for these video – Squidoo is another sea change microISVs need to be aware of.