Final Results of the Great 99 cent Experiment
So were you wondering if my crazy 99 cent WinPatrol PLUS Experiment was a success? I promised to provide the numbers so I’ll let you decide for yourself. I do recommend you read beyond the initial numbers
The goals of the experiment were some what vague so the results cover a wide range of marketing principles. Ultimately, I wanted to find out if traditional software vendors would need to make changes to compete with the concept of 99 cent downloads available to pocket computers like the iPhone and Droid.
From a financial standpoint the results of this experiment were great. Even at 99 cents the volume of sales over a 50 hour period made the extra work worthwhile.
Sales generated just under $15,000 in raw income while adding about 15,000 new WinPatrol PLUS members. The majority of new members had never tried WinPatrol prior to the experiment but a large number were long time users of the Free version who just couldn’t afford the current $29.95 cost to upgrade.
The most painful part of this newly generated income was the large portion taken away by online payment processing. When you sell a product for 99 cents the credit card companies take a huge chunk. On a normal $29.95 WinPatrol PLUS transaction PayPal gets about 5% of the sale. When its on $0.99, PayPal gets a full 25%. I don’t have all the final numbers from Visa and MasterCard but it appears their cut was even more.
Apple actually gets 30% of all sales so this part of the experiment makes for a good comparison. Developers have some advantages in the App Store like the built in ownership protection. I already have people posting their 99 cent PLUS codes on keygen sites for pirated software.
A number of companies have tried to create online stores for the traditional software marketplace but they’ve had limited success. We really need a simple easy method for users to download and purchase software. There are companies out there very close to making this happen but just need critical mass of users to make it acceptable.
If my goal was great Public Relations then the experiment was certainly a success. One of my biggest fears was backlash from current WinPatrol PLUS members who may have recently paid $29.95. The objections to this experiment I can count on one hand. Most current members helped spread the news to family and friends and some even purchased a 99 cent license just to participate and show their support.
As I said, many of our new PLUS members had never heard of WinPatrol so I easily have over 10,000 new WinPatrol users who are now in a position to tell their friends and family about WinPatrol. Once someone installs and understands what WinPatrol can do we usually have a long time loyal friend. Last year I had a total of four customers actually requested a refund. Not many products can claim a satisfaction record like that.
While sales exceeded my expectations so did my work load. For over a week life for both my wife Cindi and I has revolved around this experiment. A lot of the extra work could have been avoided if I created an additional (mirror) download website for the WinPatrol setup program. While I knew I had the bandwidth to handle the influx in purchases I neglected to realize most of our new fans would also need to download the WinPatrol setup program as part of the process. Once someone starts a download that holds up a connection to our server and physical connections do have a limit.
During the peak of our sale the 3rd party store, which doesn’t run on our servers, held up great. When users returned to receive their PLUS code we failed due to lack of connections. The result was way more Emails than I could handle in a timely fashion. This process has taken up my days and nights but I must say people have been extremely polite and understanding.
The work load on my wife Cindi was also overwhelming. In many cases, when people didn’t receive their PLUS code, they’d go in to try again. Realizing what we had going on Cindi decided to process and review each order manually. While processing orders Cindi could see if the same person ordered more than once. She would process the first order normally but make sure any subsequent orders were not charged to the customers credit card. It’s possible some of these orders were intentional but our priority was to make sure nobody was over charged so she reviewed each order personally. This may be more than you needed to know but I can’t help but praise my valentine.
While having over 10,000 new WinPatrol PLUS members is great I’m not exactly setup like most businesses. I have always read each support@WinPatrol.com Email and I respond personally. My normal day does not end until all Email has been answered. Luckily, WinPatrol is easy to use and most of my daily Email consists of requests for lost PLUS codes. Most of the Email from the new users were questions I’ve answered before but they did add to already “I didn’t get my PLUS code” messages. At times it was refreshing when I got a spam message which I knew I could just delete.
One thing we did have in common with the 99 cent software sales in the App Store or Droid Market were expectations. When people only pay 99 cents they don’t expect much. I would have had more Email but many people may not think asking for help is included in the price. I’ve been tracking activations and found another surprise. Less than half of the new customers have followed the instructions to activate their PLUS features. I’m sure some are still exploring the Free benefits but some have admitted “I don’t know when I’ll get around to it. I just figured for 99 cents what can I lose?” I’m sure there are some out there who really don’t have a clue what they purchased and haven’t even downloaded the Free WinPatrol.
I’ve crunched the numbers and have evaluated hundreds of comments. There’s no doubt that how we purchase software is changing. Most users have accepted downloading as a software delivery method. We all live in an immediate world which has helped people accept online software delivery.
Based on the experiment I would be best off by selling WinPatrol PLUS for $9.99 but without free updates. It has been recommended I make WinPatrol PLUS a yearly subscription. I don’t expect to make any chances in the near future. What do you think?