Recently we launched a new software product and I wanted to check how to improve our sales tactics. I did some research on different distribution models of big software companies* and found out how sales tactics have changed from 1995 till now. Here is what the research showed.
What are the best sales tactics for a new software product:
1. First movers advantage
Being first can be highly profitable or super destructive. 90% of the software companies had an innovative product that differentiated them. I will give some examples:
- Netscape had the first internet browser out there.
- SUN came out with Java, which changed the whole industry.
- Google made the search based on the relationships between websites.
- VMware was the first to virtualize the x86 architecture.
- Adobe refined their Post Script anguage and designed the PDF format.
We can see the scalability of a good software product, but sometimes It’s hard when you have to “educate” the market to use the new technology. If you fail to do that, your product will never reach a big mass of people. To promote our new development, we have to use different sales tactics combined with great advertisement and word of mouth.
2. Acquisitions and partnerships
Almost every software company grows really fast because of acquisitions and partnerships. Being able to offer your client a “one-stop-shop” is becoming more and more important nowadays. National and international alliances are a key component of one’s strategy within the internet hardware and software industry. Here are some examples of partnerships that really changed the game:
- After the first Apple Store opened, Apple sold third-party accessories;
- Microsoft “…We distribute software through OEMs that pre-install our software on new PCs, servers, smartphones, and other intelligent devices that they sell to end customers…”;
- Oracle Corporation works with “Oracle Certified Partners” to enhance its overall product range;
- Google acquired Youtube, which made a huge difference for it;
- The VMware Partner Network includes a range of partner programs to meet the needs of a variety of partner types;
- Alibaba signed a Memorandum of Understanding with the Korea Small and Medium Business Administration to promote Korean exports via e-commerce;
- YouTube launched its Partner Program to let people get paid for their viral content in May 2007. This was the first time YouTube made it possible for everyday people to turn their hobbies into a business.
Merging with other companies and making international partnerships is a must for your company’s growth.
3. Community and blogs
We live in a world where there are social media, blogs, forums and webinars where you can find all the information that you need for almost everything. That’s why it is really important for your company to have a great offline and online image.
How do big companies do that? Well, mostly with inbound marketing and blogs:
- Netscape also has a wide variety of community-based forums within Netscape Forum Center, including its browser’s community support board. To post on the forums, users must possess anAOL Screen name account in which to sign in, referred to within site as the Netscape Network;
- On the community level, Adobe continues to develop and support user groups, forums and communities on their website that use and share the same technologies. Designers, developers, users, educators and partners—Adobe continues to design and develop with the end user in mind, and for the community of users it has built;
- Cognizant’s sustainability efforts include a Go Green initiative launched in 2008 that focused on energy conservation, recycling and responsible waste management. In October 2012, Newsweek magazine ranked Cognizant 50th among the 500 largest publicly traded companies in America in its annual Green Rankings.
- YouTube reported in its company blog that the site was receiving more than three billion views per day.
- Imgur – originally designed as a gift to the online community of Reddit, it took off almost instantly, jumping from a thousand hits per day to a million total page views in the first five months
4. Free product but paid premium features
We all have seen products where you have to pay for a premium version that unlocks the full features. People are more willing to pay for something that they have tested than for just an advertisement and promises. But there are different freemium models that we can see in the IT business nowadays:
- Twitter – registered users can read and post tweets, but unregistered users can only read them.
- VMware offers free software you can test and then use to configure your preferences for the end product.
- Alibaba.com offers a Gold Supplier membership to try to ensure that each seller is genuine. Also, a membership plus value-added services for registered users.
- Acrobat Professional is the high-end version of Acrobat 6, geared towards prepress use. It offers a plethora of new features. Free product but you pay for add-ons.
- Groupon’s VIP members get access to new deals 12 hours earlier than non-members, as well as access to expired deals.
- Imgur If an account has more than 225 images, only the most recently uploaded 225 are displayed in their profile. Paid pro accounts were created in 2010 to remove these limitations and allow infinite image storage, as well as increased upload limit.
Ready for Part 2
*This follows the tactics – if you love the product, you will pay some extra bucks to use every functionality it has. It works for sure! All above are the distribution models of : Netscape Communications, Apple, Microsoft, Oracle, SUN, Twitter, Google, VMware, Alibaba, Adobe, Qlik Technologies, GroupON, Cognizant Technology Solutions, Shutterfly, Pegasystems, Red Hat, WhatsApp, WeChat, YouTube, Vine, Imgur, Twitch, Spotify, Flipboard, YinzCam and more.
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Any questions regarding your sales tactics?