• Sign Ups: 1.0% more
• Sales: 17.1% less
• Average Purchase: 3.0% higher
• Total Profits: 14.8% less

I am especially disappointed with the Sign-Up conversion rate. It has increased, but only slightly. I was expecting more from the strong focus on the calls-to-action in the top section. Maybe having two CTAs there (try and buy) is not the way to go. Let’s tweak and then test again:

Here the changes I made:

• Just one call-to-action (sign-up for the trial) in the top section.
• To make up for the loss of the buy box at the top, I moved the buy boxes in the content up to just below the big testimonial.
• Removed the “sign-up for the trial” box from content. Replaced with “Current Versions” box, to indicate recency.
• Rewritten the copy of the 3 feature boxes at the top, to make them less vague, plus mentioning the mobile and online apps.
• Optimized image size to improve page speed.
• Added drop shadow to screenshots in content to make them look nicer and stand out more.
• For consistency of the look and feel between the landing page and the rest of the site, I implemented the fancy buttons everywhere, on the features pages, on the buy pages, etc… in versions A *and* B.

And now… we wait.

We have been tweaking and testing with small changes of the old design for a long time.
But now it’s time for a major overhaul, with a cleaner layout and a more “2012 looking” design.

What’s new:

• New browser-wide dark grey header with product name, main headline, platform logos and Facebook box.
• New site-wide picture at the top, with my two main call-to-action boxes (try and buy), plus a new picture of that handsome bald guy
• 3 column content layout instead of 1 column content with narrow sidepanel.
• Site-wide testimonial in big font, linking to more testimonials at the bottom in 3 column masonry layout.
• Fancy buttons, with nice gradient and rounded edges.
• Clearer separation of included software features and optional add-ons.
• Using white space for column separation instead of borders.

Here’s the old and the new design next to each other. Which one will win?
Time will tell. I’ll probably run this test for at least 2 weeks.
Of course, the results will appear here.

If the difference in conversion is large, the decision is easy: just switch to the best version.
If the difference is small, the decision may be harder, but then again, which way you go doesn’t matter much anyway.

However, I have just done an A/B test where the difference in results is large, but still it’s not clear whether I should stick with version A (my control), or switch to version B (my challenger). Here’s my test:

Sign-up for the trial boxes

Our product pages have a “sign-up for the trial” box in the side-panel on the right and an additional big sign-up box in the content area, a little way down the page. The big extra one doesn’t look too great and it kind of disturbs the “flow” of the content.

So I wondered whether removing that extra box would make a difference. The test:

• Version A: “Sign-up for the trial” boxes in both the side panel on the right and in the wide content panel.
• Version B: Removed the big sign-up box, so just a “sign-up for the trial” box in the side panel remains.

The results

These are the numbers for version B over version A, after 14 days.
In other words, removing the big additional sign-up box caused:

• Sign Ups: 15.6% less
• Sales: 1.5% more
• Average Purchase: 5.9% higher
• Total Profits: 8.0% higher

As expected, removing the extra sign-up box caused a decrease in the number of sign-ups. (Though I did not expect the numbers to be this dramatic.)
However, profits are up and considerably so. Not sure why. Maybe it’s the better looking and better flowing content story? Maybe making the trial less prominent causes an increase in the number of immediate purchases?

So now what?

Do I opt for version B and thus remove the extra sign-up box? More profits is good right?
Or should I go for more trial users and I leave my site as is (A), with 2 sign-up boxes?

What do you think? What would you do?

Hi Sytske,

We noticed a significant increase on the nr transactions for collectorz.com, please see the table below.

Is there a particular reason for that?

Thanks in advance for your comments,

Jonas

But then we had nice cartoon characters created, mainly for use in advertising material. Being happy with the results, we thought: let’s use these characters on our product home pages too. It would improve the “after-ad-click” recognition of the visuals and of course, it just looked nice.

So we replaced the photos with the cartoon characters, without split-testing.

Recently, while staring at our website, I started wondering: was this really a good idea? The cartoons may look nice but do they really work better than the photos?

So I finally did the A/B split-test: Cartoons (A) vs Photos (B).

Version A – Cartoon characters:

Here’s what our Movie- and Book Collector pages look like with the “CLZ Babes”:
Pros: it looks nice and creates a strong connection between our banner visuals, the landing page and the software itself (where the CLZ babes are also used, e.g. in the splash screen).

Version B – Photos of me and Sytske:

These are the same product pages with the collection photos of my wife and me:
Pros: recognizable image for collector-types, builds trust because it shows the company owners are collectors too.

The results

Well, I was glad I finally came to my senses and did run the A/B split test after all.
Because these are the results after 7 days (about 1,500 sign-ups and 300 sales):

Compared to version A (cartoons), version B (photos) generated:

• Sign Ups: 5.1% more
• Sales: 35.3% more
• Average Purchase: 15.6% higher
• Total Profits: 53.9% higher

Is that scary or what? Needless to say, I am back to using photos on my landing pages.
But the more important lesson here is:
never make big changes to your website without split testing.

How can you sell more stuff to your existing customers?

But before we move on to the HOW, let me first give you 3 reasons WHY you should sell more to your existing customers and some ideas on WHAT you could sell to them.

(this is a reworked and updated version of my presentation at the European Software Conference in London, November 2011)

Why sell more stuff to existing customers?

Well, the short and simple answer is:
to make more money.

But here’s the longer answer. 3 reasons:

It’s easy

Nothing’s easier than selling to existing customers. When selling stuff online, one of the main factors that impact conversion rates is trust. It’s hard to get people to trust you with their money, especially if you’re a small and relatively unknown ISV.
Not a problem when selling to people who have bought from you before. These people already know you, love you (I hope) and trust you to actually deliver the goods (because you have done so before).

It’s cheap

Acquiring new customers is expensive. You have to spend money on Adwords, adCenter and Facebook ads, spend time on SEO, or maybe even deal with pre-sales questions.
However, your existing customers can be reached for free, in various ways. Email being the most obvious choice.
BTW: even though the selling can be done for free, the creation of the “stuff to sell” is not without costs (with some exceptions, see below).

It’s good for you

And with you, I mean: your business. Consistently selling to your existing customers again will give your business more stability, continuity and value.
Think about it: what happens if your flow of new visitors suddenly decreases or even comes to a halt? Google may drop your website from the organic results or they may ban your Adwords account. If your entire business consists of selling one product to new customers, your income will immediately drop to next to nothing.
On the other hand, if you are consistently selling upgrades, add-ons, subscriptions and other products to your existing customers, your business will go on, and you will still be able to pay your bills. Of course, if the traffic problem persists, that will taper off too, but you will at least have some buffer to do something about them.
Also, by having a continuous flow of income from a substantial customer base, you are creating value in your business. Your customer base will become your most important asset, especially if you can create an automatic source of recurring revenue (subscriptions!).

What can you sell to existing customers?

We’re in the software business. We sell software, not jars of peanut butter that need to be replaced when empty. For most of us holds: once people buy our software, they can use it for the rest of their life.

So if you want to sell again to the same people, you will have to come up with something new. Here’s some stuff you can sell to people who have already bought your software:

Subscription services

The easiest way to make your software more like that jar of peanut butter:
Sell it as a subscription service. Or create a new subscription service that you can sell as an add-on to your “pay once for life” software.
With our Collectorz.com Connect web-app we did both. Connect is both a stand-alone web-based cataloging tool and an optional add-on for users of our desktop software.

Paid upgrades

The next best thing and the most natural way to sell again to your loyal users: charge for your software updates. You’re constantly improving and updating your software anyway, so the extra costs are low. Just combine several big new features and improvements in a major upgrade, and your users will be happy (even expecting) to pay for it.

If you’re not doing paid major upgrades, you’re leaving a lot of money on the table. We only starting doing this in our 7th year (!!), in 2007. It was a huge jump for our company, not only in profits but also in the quality of our software. Somehow, preparing a major upgrade that your users have to pay good money for really gets the creative juices flowing. And the extra money makes sure you have the resources to implement your new ideas too.

Plug-ins and add-ons

If you’re planning to add a new piece of functionality to your software, especially if it’s an exotic or advanced feature, consider making it into into a plug-in or unlockable feature that you can sell to your users. The App Store’s “in-app purchases” are a good example of how well this system can work.
Alternatively, create additional add-on software that closely works together with / connects to your main product, e.g. an import/export tool or a mobile app.
For example, our CLZ mobile apps are add-on apps, that let desktop users export then view their collection database on their mobile device.

In general, plug-ins and add-ons should contain functionality that is only needed or wanted by a subset of your audience, in most cases the more advanced users. Otherwise, you’re better off including the functionality in your main product.

Related software

This is the most expensive and time-consuming “stuff” to create, but can be well worth it.
With related software, I mean new stand-alone software products targeted at the same audience as your existing product. Cross-selling related software is not as easy as up-selling to add-ons, but it still gives you a ready-to-go audience to sell to.
For example, if you’re selling a HTML-editor tool, you may want to create an FTP client.
Or, if your main product is CD cataloging software, consider developing similar database programs for DVDs, books, comics or video games

Priority support

Priority customer support may be the cheapest “stuff” that you can sell to existing users. You are providing excellent support to your users anyway, so why not make some extra money doing it. Some customers are happy to pay for a “response within 24 hours” guarantee. If you’re selling to businesses, many will even expect to have to pay for support. So don’t disappoint them

Hardware

And finally, you could sell hardware and other physical items that relate to or work with your software. Selling hardware is not exactly risk or hassle free, as you have to invest up-front, manage your inventory, deal with warehousing and shipping costs, etc… However, you can test the water by selling the items through an affiliate or drop shipping system first. Then if it’s successful, you can start taking stock yourself, and increase your margins.
At Collectorz.com, we have been quite successful selling barcode scanners. We started out with just one scanner, but are now selling 3 different scanners in 3 price categories. We buy them in large quantities to get the costs down and make a healthy margin.

How to sell more stuff to your existing customers?

So far for the why and the what. On to the most interesting part: the how.
Because new stuff doesn’t sell itself. Just putting it in your shop is not going to work.

To actually sell your new program, upgrade or add-on to your existing customers, you need to do three things:

1. Create awareness: The minimum you need to do is make people aware of your new stuff. If they don’t know it exists, they won’t buy it.
2. Ask for the sale: Then, at some point, you need to be blunt and just ask for the sale. Tell people to buy now and explain how to.
3. Remind them: Finally, keep reminding them. Don’t just do a happy “it’s live!” email once and expect everyone to purchase. You need to remind them, again and again.

Now, let’s look at ways you can do all three. The obvious choice is to use email, but it certainly isn’t the only way:

Your website

Goal: awareness

Start creating awareness of your up-sells and cross-sells right on your landing page. Let your new visitors know it’s there for them, even before they buy your main product. The existence of the extras may even help sell your main product.
In any case, don’t hide your extras in your shop.

In your software

Goal: awareness

For add-ons, mobile apps or hardware that connects with your main product, a natural place to create awareness is inside your software itself. A simple link to your website for more information is enough.
For example, this is the Add screen of our Book Collector product.
The “No scanner found” message is also a link to a page on our website that explains the advantages of adding books using a barcode scanner.

Facebook page

Goal: awareness / reminders

Do you have a Facebook page for your company? Or maybe for your product? Posting updates there is a nice extra way to reach your customers. The advantage of Facebook updates is that the annoyance threshold is much lower than for email. You can easily post 2 or 3 updates a day without anyone being annoyed.

You can use updates to post user stories and testimonials (for awareness, reminders), progress updates (for pre-launch awareness), announcements, etc… Here’s an example of a progress update post. Note the link to the product page and how we use the names of our programmers to make it more personal.

Twitter

Goal: awareness / reminders

Twitter can be used in the same way as Facebook, though it’s a slightly different audience. While Facebook works well for consumer-type products, Twitter seems to be more suited for business/professional software.

Tip for both Facebook and Twitter: if you have a longer story to tell, put it on your website (or your blog) and include a link in your tweet or FB update. That way, you get people back to your website, where your up-sells are. On our Collectorz.com blog, we always list our current offers in a panel to the right of the blog post.

Facebook Fan Ads / Customer Remarketing

Goal: awareness / reminders

This may sound crazy, because one of the WHY’s I mentioned above was that selling to existing customers was cheap. But if you have valuable extras to sell, it may make sense to advertise to your own customers, that is, with paid ads. Just as an extra way to reach them.

Facebook fan ads (Facebook ads targeted at people who like your page) work well for this and are relatively cheap:

A 2nd paid method for reaching your own customers is remarketing. Just create a customer audience by cookie-ing people on your “Thanks for your purchase” page, then target that audience with up-sell banners.

Email Marketing

The above channels are all great for awareness and subtle reminders, but email marketing is still the best way to create awareness, send reminders and to make the actual sale. Here’s four powerful ways to use email:

Monthly newsletter:

Goal: awareness / reminders

If you wanna sell more to your customers, the absolute minimum you need to do is remind them of your existence once in a while. In a monthly newsletter you can do subtle reminders by writing about the past months’ releases, including small maintenance builds. Create pre-launch awareness by including news about your progress on new products and updates.

A newsletter is not the best place to ask for the sale. If you want another chance to sell a new product, I would suggest to be more subtle about it and just repeat the announcement, linking to the product page for more information.

Pre-launch “Preview Clubs”

Goal: awareness / ask for the sale

A Preview Club is a form of list segmentation used for product launches and major upgrades, a way to send specific emails only to people that are interested in receiving them. A couple of weeks before a product launch, you send out an email to your entire list, announcing the new product and inviting everyone interested to join your Preview Club. They can do so by clicking a special link that tags them as a member.
In the weeks before launch, club members receive extra emails, feeding more information, sneak preview screen shots, Q & A’s, etc… The club emails tell them everything they need to know to make their buy/upgrade decision. For example, here’s the Sneak Preview Page that we used for the Movie Collector 8 for Mac preview club.
Then on launch day, many club members will be anxiously refreshing their inbox waiting for your launch email, credit card in hand. So in your “IT’S LIVE” email, you can be to the point and just ask for the sale.

After launch, don’t throw away your valuable club list. Not everyone will immediately buy on launch day. Don’t hesitate to send them at least 3 reminders, e.g. 5 days after launch, 4 weeks after launch, 3 months after launch.

Pre-launch clubs let you get away with frequently emailing certain users (up to twice a week even!), without annoying anyone. For Collectorz.com, “clubs” have been very effective in increasing the sales numbers for upgrades, new products and add-ons. They’re also a good way to judge interest before launch, so that you can know what to expect in terms of sales.

Sales campaigns

Goal: ask for the sale / reminders

Finally we get to the hard sales push .
Sales campaigns are great to generate a lot of sales in a short period of time. Discount one of your products for a week and let your users know about it by email.

Some tips to optimize your results:

• Discount: The discount you’re giving should be considerable, at least 30%, maybe even 50%. It’s not worth (ab)using your list for a small 10% discount.
• Urgency: Have a hard deadline that is not too long away, say 1 week, to create urgency. And be as clear as possible about the end date, repeating it in different wordings, e.g. “This offer ends on April 8, 23:59.”, “2 days left” and “on April 9, pricing will be back to normal”.
• Scarcity: If you can, create more urgency by scarcity. “54 items left” is a clear and understandable incentive for users to act now. Using scarcity is most natural when selling hardware (limited stock). But it can also be used for digital goods, e.g. by saying “The first 250 buyers will get an extra 10% discount”.
• Peer pressure: Help people decide by showing them that many other users went before them. Especially effective in reminder emails (“Since the start of Book Collector week, 327 of your fellow users have taken us up on this offer”).
• Reminders: Don’t hesitate to send multiple reminders during the discount period. In any case, always send a reminder email on the last day. We have found that a short “x hours left” email always generates a sales spike at least as high as first day spike.

Here’s the results of an “Upgrade Week” we did between May 11 and May 16 2010. I have include some extra days from before the Upgrade Week, so that you can better see the effects of the offer and the 2-days-left reminder.

Auto-responders

Goal: reminders / ask for the sale

After new customers purchase your main product and have been using it for a while, you want to remind them of the add-ons and other products you have available for them. Now you can of course send a broadcast email to your entire list once in a while, but that is sure to annoy many people.
The solution here is to use an auto-responder sequence for customers, a predefined set of emails that is sent to customers on a preset numbers of days after their purchase. This gives you the ability to perfectly time your messages in relation to how long they have been using your main product.

For example, this is our auto-responder sequence for people who buy our DVD cataloging product Movie Collector:

• Day 0: Thanks for purchase, link to “Getting Started” guide.
• Day 7: How to speed up your cataloging with a barcode scanner.
• Day 15: Your collection cataloged? Use the CLZ Movies app to view it on iPhone.
• Day 60: What about your books, CDs, games and comics?

Summary and warning

To summarize the above:

• Come up with stuff you could sell to your existing customers. Think about add-ons, related products, hardware?
• Instead of adding the next advanced feature to your existing product, consider creating a new add-on or product that you can actually ask money for.
• When selling that upgrade, add-on or new product: build awareness, push the sale (hard) and keep sending reminders, again and again and again and again.
• Use multiple “channels” to reach your customers. Don’t limit yourself to just email.

And a warning:

Selling more stuff to existing customers is a great way to make more money. But do not underestimate the importance of continuously attracting new customers. The better you get at selling to your existing customer base, the more important it becomes to grow that list. Don’t forget that while you’re adding new names to the top of the list, others will be falling off the bottom. If your add-rate slows down, your list may be shrinking.

First, a quick reminder of what remarketing is:

Remarketing is a cookie-based advertising system that lets you show your ads to people who have already visited your website.
Your ads can appear on any site that the user visits after visiting yours.

For example: A user visits my Movie Collector product page (it doesn’t matter where he came from, an ad, organic result, a link on another website, etc…). Now after he visits my website, this user goes on to browse the internet, visiting other websites. And suddenly everywhere he goes, he sees Movie Collector ads. Leaderboards, towers, inline rectangles, even little text ads. My ads are following him around the web.

One important thing to understand: remarketing ads do not only appear on websites related to your product, like your regular display network ads. No, they appear everywhere, on any site. Remarketing lets you target specific users on any site, as opposed to all users on specific sites.

Remarketing for software

I started using Remarketing for our Collectorz.com software 2 years ago, when Adwords started offering it. Like most advertising and marketing tools, it didn’t work right out-of-the-box. It took a bit of tweaking and tuning to make it effective, but ultimately I found that remarketing can be a great fit for software vendors, especially if you use some kind of “try-before-you-buy” system.
Here’s some factors I played around with:

• Message
• Targeting, or: who to cookie?
• Audience Membership Duration and Frequency Capping
• Bidding type: CPC or CPA
• Reducing the creepiness

Let’s discuss these one by one:

Message

This is the first thing I experimented with. Mainly, how obvious do I make it to users that they are being remarketed to and how hard do I push for the sale?

One could go as far as saying:

“Hey, remember Movie Collector?
Please come back and I’ll give you $10 off”

However, my feeling was that this would make it too clear to visitors that they saw the ad because they visited my website earlier. It would probably annoy too many of my visitors, so I didn’t even try that.

So my first try was a bit less creepy, but still pretty pushy. The message was

“Special offer: Save $10 on Comic Collector today. Coupon: XXX-XXX”

The idea behind this was: these people have already visited my website, so they already know what Comic Collector is and do not need further explaining. I could push for the sale now, with the added incentive of the $10 discount coupon. The banner also linked straight to our shop.

This did result in some sales, but not many. And I never saw the special remarketing coupon being used. So I concluded this sale-focused approach was too direct.
(a year later I tried this direct-to-shop approach again, with the same results, no one ever used the special coupon)

When looking at the results of the sales ad above, I noticed something interesting. The ad only resulted in a couple of normal conversions, but it generated many “View-through conversions” (Adwords terminology for “conversions that happened within 30 days after a user saw, but did not click, a display ad”). In this case, conversions being sign-ups for the trial version. It looked like the mere seeing of my ads was reminding visitors of my product and even triggering them to go back to my site and sign-up for the trial after all.

So in the end, I decided to use my regular Display Network ads for remarketing, linking them to my regular product landing page. Like so:

This resulted in higher CTRs and more conversions, both regular and view-through.
The remarketing ads are now just serving as a reminder of our existence, a way to stay top-of-mind and, excuse me for using the dreaded B-word, Branding.

Targeting, or: who to cookie?

This is probably the most important parameter to experiment with. Some tips:

Tip 1: Product-specific audience lists
Of course, you can just add the remarketing scripts to all pages of your website, creating one audience list, and then target that audience with your remarketing ads. But if you have multiple products, you should create separate audiences per product, so that you can show them targeted product-specific ads. I am separating my visitors into 5 product-specific audiences, plus I have one extra audience for users who visit the home/hub page of the Collectorz.com site only.

Tip 2: Cooky first-time visitors only
I started out targeting all visitors of the Collectorz.com site. However, after sending a broadcast email to my existing Music Collector customers, about a minor update, I noticed a huge jump in the impressions of my Music Collector remarketing ad group. This made me realize my site was also dropping the remarketing cookie for my existing customers. And I definitely didn’t want to spend precious advertising money on them, as they already purchased Music Collector!
So I added some PHP code to my site that includes the remarketing script only for first time visitors, on their first page view. This dramatically improved the conversion rate of my remarketing campaigns, simply by decreasing the size of the audiences (and thus the number of impressions).

Tip 3: Separate audiences for different “levels of interest”
Instead of adding all visitors to your audience lists, you may consider adding only those who visited a specific section of your website (e.g. your Features page), or performed a specific action (e.g. downloaded your trial edition). The more interest the visitor shows, the more likely he/she is to convert. So keeping your audience limited to visitors who have shown a certain level of interest will reduce the size of your audience lists, reduce costs, and improve conversion rates.

Alternatively, you can keep remarketing to everyone, but drop separate cookies depending on interest level. This way you can target them in separate campaigns with their own ads, bids and settings. I am generating great results by separating “visitors” and “trial users”, then using higher bids and longer audience memberships for trial users.

Tip 4: Target buyers for up-selling
Finally, you could take the interest targeting one step further and drop a separate audience cookie for buyers, e.g. on your “Thanks for your purchase” page. The resulting audience can then be used for cross-selling your other products, up-selling to add-ons or more expensive versions, etc…
Note that the your audience must contain at least 100 users before Adwords starts showing impressions to them, so it may take a while before your “customers” ad group gets impressions.

Audience Membership Duration and Frequency Capping

When you define your remarketing audiences, one of the settings is the “Membership Duration”. My first try for this setting was 60 days, because for us that is about the longest it takes for a first time visitor to actually convert to a customer.
In practice, this turned out to be way too long. Of course, the chance of conversion severely drops after the first few days, so I quickly changed the setting to 30 days. Then after I created the separate audiences for visitors and trial users, I decreased the membership of the visitor audience even further, to 7 days. The membership duration of the trial user audience is still set to 30 days.

The 2nd setting that I found to be important to tweak the results (mainly the costs), is the Frequency Capping. This setting is not defined at the audience level, but rather a regular setting of your Adwords campaigns.
The default value is “No cap on impressions” and that is definitely not what you want for your remarketing campaigns, if only to keep down the annoyance factor. This default setting will sometimes even show your ad multiple times on one page, especially on sites that do not have a lot of competing advertisers.
I currently have it set to “5 impressions per day per ad group”, which caused a huge decrease in impressions and costs.

Bidding type: CPC or CPA

This is a tricky one. I am a huge fan of the conversion optimizer, so most of my campaigns are set to CPA bidding. For remarketing campaigns CPA bidding can work fine too, but there are two things to watch out for:

View-through conversions
Google’s conversion optimizer only optimizes for conversions following an actual click on your ad. View-through conversions are not counted. (this is not specific to remarketing, it’s like this for all campaigns)
Now, as I said above, remarketing campaigns typically generate a lot of view-through conversions. I think that is because just seeing your ads reminds people of your site or your product. So when setting your CPA bid make sure to consider this. In general, you can set the CPA bid to a value higher than what you would normally pay for a conversion.

On the other hand, think about this: Are these view-through conversions actually being caused by your ad? I mean, all visitors get a remarketing cookie, so all of them will start seeing your ads on other sites. Many (most?) of them are likely to see your ad on some other site before they convert (unless they convert immediately on their first visit). Which may mean that many of your regular conversions could be attributed to your remarketing campaign as view-through conversions, even if the ad didn’t help at all. The impact of this effect of course depends on the type of conversions you track (downloads, sign-ups, sales), how fast your typical visitor converts, your frequency capping settings, etc…
But be aware of this effect while looking at your conversion data, and when deciding between CPC and CPA.

Conversion types and targeting
This may be an obvious one, but it still bit me. Let me explain:
Let’s say your conversion tracking is set up to count trial sign-ups as conversions. Then you create a remarketing campaign that only targets highly interested visitors, that is, those that signed up your trial edition. Now guess how many conversions that campaign will generate?
Of course, the right answer is: almost none.
This makes it hard to judge the effectiveness of the campaign and makes it impossible to use CPA bidding. Unless you also track your sales as conversions. But then you still have to be aware that the conversions you do get are probably all sales and thus way more valuable than your average conversion.

Reducing the creepiness factor

An often heard comment about remarketing is “It’s creepy!”. But is it?
I am sure when Adwords was launched, people found it creepy that after doing a Google search, suddenly ads appeared on the side that exactly matched what they were searching for. Now? Not so much.
A bit later, people were upset about targeted ads appearing in Gmail, matching the contents of their email. Outcries of “Google is reading my email!” were everywhere. Now? Who cares…
But yeah, I am sure some people will find remarketing creepy. But IMO it’s just the next step in better ad targeting. In general, I think people would prefer to see remarketing ads that are actually targeted at what they’re interested in, as opposed to random ads of uninteresting stuff. The better the targeting of ads, the less annoying they are.

Still, there’s some things you can do to reduce the creepiness factor of remarketing:

• Cap your frequency: Don’t leave your frequency set to “no cap”, as users will indeed see your ad everywhere, on every site they visit, all day long. They will feel stalked. Instead set it to 5 per user per day, maybe even lower.
• Limit your Audience Membership Duration: Don’t be too persistent. Reminding visitors of your existence is fine, but make sure to give up after a reasonable period of time. One week seems to work for me.
• Have a less confronting message: Don’t make it too obvious from the ad that the user is being retargeted, e.g. by saying “thanks for visiting Collectorz.com, please come back!”. Instead, make it seem like the user just happens to see your ad
• Only cookie interested visitors: Take a look at the bounce-rate of your website. Note how many visitors immediately leave your website within seconds. Then realize all these bouncing visitors have been given your remarketing cookie and will start seeing your remarketing ads. Do you really want that? Consider not dropping the cookie on your landing page, but one step further in your conversion process.

I hope the above will help you tweak your remarketing campaigns to make them more effective (and less creepy ).

However, from a software marketing perspective, I keep running into 3 main problems of the current mobile apps biz (one of which is App Store specific):

• No customer information (App Store specific)
• No ways to do coupon or bundle discounts
• Low pricing levels

Here’s the full story on all three, including my suggested workarounds:

1. No customer information (App Store specific)

Email marketing is an important tool to sell more stuff to your existing customers. Email is a great way to tell them about your other products, or simply about new versions of the product they purchased.
However, when selling iOS apps through the App Store you don’t get any information about your customers, no name, no address info, not even an email address. You can see how many apps you sold, by day and by country, but that’s it.

For instance, I have no idea who has purchased our CLZ iPhone or iPad apps. So how do I notify them of a new version? How do I cross-sell our other apps to them? Or, if we forget the selling for a minute, I can’t even send them usage tips, or let them know about known issues or server problems.

For us, at Collectorz.com, this sucks. Email is very important for us. Building a list of customers you can actually reach means building a solid foundation for your software company. Without being able to cross-sell and up-sell to your existing customers by email, you’ll have to attract new customers every day and can only sell to them once.
This seriously reduces the life-time customer value, which also makes it next to impossible to do paid advertising for iOS apps (especially combined with problem #2 below).

Imagine if Rovio could send a simple email to everyone who purchased earlier Angry Bird editions, and tell them about the release of the new Angry Birds Space? I am sure they’re doing fine now, but don’t you think they could easily sell twice as many copies of Space if they were able to reach their existing customers by email?

At Collectorz.com, our mobile apps are add-ons to our desktop software, so all app buyers are already on our email list. So at least I can reach them, but to do so I need to email my entire customer base. Which means I am annoying non-app-buyers with my iPhone related news. Or, the other way around, if I want to do a special half-price promotion for my mobile app, I have no way to email just the people who have not purchased it yet. I would have to email my entire list, also reaching users who already own the app. And you can imagine their reactions…
BTW: the next version of our mobile apps will be stand-alone cataloging tools, which means we will be attracting new customers. And I will have no way to reach them at all.

Suggested workarounds

To solve this Collectorz.com “list segmentation” problem described above, we have created “interest clubs”. By clicking a simple link in a “broadcast-to-all”-email, my customers can join special our “iPhone Club”, “iPad Club” or “Android Club”. Club members get more regular updates about their app. Not ideal, but it helps.

Another solution used by app developers is an optional or even mandatory sign-up. This is a good solution for apps that require some kind of cloud account anyway, e.g. apps like Evernote. Another example is the popular DrawSomething, from whom I received a great email this weekend about their recent app update. DrawSomething requires an email or Facebook sign-up before you can play with others.

2. No ways to do coupon or bundle discounts

In the App Store or Android Market, there is no way to do coupon discounts. Coupons can be an effective way to do a special promotion to a specific group of users (not everyone), e.g. only to users of your other software, only for trial users, etc…

Also, it is not possible to do bundle discounts. A bundle discount can be a great way to entice people to buy multiple apps from you in one go. Or, in the case of apps that are add-ons to desktop apps: create a bundle of the desktop software with the mobile app for a small discount.

I am surprised at the lack of flexibility in doing promotions for mobile apps. At Collectorz.com, we like to be as flexible as possible with discounts. We do coupon discounts, bundle discounts, volume discounts, special software bundles, temporary discount sales, etc… and these are all very effective in selling more software. But for our mobile apps, we can’t do any of these.

Suggested workarounds

The only workaround here is to do temporary price-drops. Just lower the price of your app for a fixed period of time and let your target audience know about it.
However, this way the low price is for everyone, not only your target group of users.
Also, if you’re thinking off making your app free for a while, be careful! The Android Market does not allow making your app free and then later make it paid again!

3. Low pricing levels

Pricing of desktop software is tough. Pricing of web-based subscription software is even harder. But at least you have the freedom to choose a pricing level that works for you, your specific software and your specific audience. No such luck for mobile apps.

The mobile market place, at least the most visible part of it, is dominated by the highly popular games and utilities. The ones that sell hundreds of thousands of copies, or even millions. And these apps can get away with $0.99 or $1.99 pricing. Because of their sales volumes, these apps generate lots of profits anyway. One might even argue that the low pricing is part of their success.

However, as a developer of highly specialized niche applications, your volumes will be much lower, maybe a couple of hundred copies each month. With a $0.99 price tag you will never earn back your development costs, or make any money. Your price will have to be higher, say $4.99, $9.99 or even $14.99, to have a reasonable chance of being profitable.

The problem is that with all popular and highly visible apps priced below 2 dollars, the pricing level expected by mobile app buyers becomes lower and lower. Users have come to think that paying $1.99 for a useful utility or a great game is a normal price. And developers asking $4.99 for a niche time-saving tool are even called greedy.

IMO this problem is caused by all mobile apps being sold in the same place, either the Apple App Store or the Android Market. In these stores, there is a direct comparison between the prices of totally different application types. High volume apps (games and popular utilities) are listed next to very niche and specialized applications.
Users are comparing a $0.99 Angry Birds app to a super-niche wireless barcode scanner app costing $7.99 (just a random example ). And rightly so, the emotional value of these apps for them may be about the same. And because $0.99 apps dominate the market, users expect the niche application to be priced around $0.99 too. Not the other way around…

The funny thing is… for desktop apps, being sold on the developer’s own website, the expected and accepted pricing is much higher. Windows or Mac editions of games like Angry Birds can easily be sold for $14.95. I mean, we’re selling our Canasta card game for Windows at a $19.95 price, without any problems or complaints. In contrast, a similar Canasta card game for iPad would probably need to be priced at $3.99, maximum. IMO, the price expectation for mobile apps is seriously messed up.

Suggested workarounds

If you’re selling niche mobile apps, my first suggestion would be: stick to a pricing level that would be normal on the desktop, based on the value for users, expected sales volumes, your development costs, etc… Don’t allow yourself to be influenced by users complaining about your pricing. If your app really is of value to its users, they will buy it. At least start pricing high. You can always lower prices later.

This is what we do at Collectorz.com and, judging from our sales numbers, we seem to get away with it (although we do get regular complaints about the price of our apps). Note that our situation may be a bit different because we’re selling the apps as add-ons to our existing desktop customers.

I figured this could be a nice extra channel to sell our existing Android apps.
About a month ago, as a test, we created a special build of our CLZ Movies app and submitted it to the Amazon Appstore for review. Approval took 2 weeks, but it got approved in one go. So we quickly prepared builds of our other 4 apps and submitted them too, hoping to get them all live before the launch of the Kindle Fire on November 15. We just missed that deadline, but still, on November 17 we received the OK on the other 4 as well.

After which I proudly announced to my Facebook fans that our Android apps were now available for the new Kindle Fire. Some customers had been asking about apps for Kindle Fire, so I told our support guys that they could tell them the happy news.
In the meantime, we had already sold some copies of CLZ Movies through the Amazon Appstore, so things were looking good.

But then we started receiving questions from customers, why they could only find CLZ Movies in the Amazon Appstore on their Kindle Fire device. Huh? All five had been approved so where are the other 4? The Appstore Developer Portal shows no difference in status between the apps, they’re all listed as “Live”.
Andrey Butov, a fellow mobile app developer, had similar results: His app, designed for Kindle Fire only, had been approved but was not available on the Fire, apparently because it had not been specifically approved for Kindle Fire yet.

So I submitted a quick question to Amazon Support, from the Devportal:

All my five apps have been approved, but my customers tell me that only 1 of them (CLZ Movies, the first one that was approved) is available in the Kindle Fire Appstore.
I can’t figure out why my other apps don’t show up on Kindle Fire. I heard that there is a separate approval process for the Fire? Is there anyway I can see the status of that?

Their answer:

Thanks for contacting the Amazon Appstore.
I’ve asked our content team to review your app again for Kindle Fire. Please note, however, that we are considering each app on a case-by-case basis for Kindle Fire and not currently offering all apps in the Amazon Appstore on the device. I will follow up with you once I’ve heard from the content team. Thanks for your patience.

What? Does this mean my apps are not guaranteed to be selected for Kindle Fire? What’s that about? My only reason for submitting my apps to the Amazon Android Appstore is to make them available on Kindle Fire (and I suspect that it’s the same for most developers).

And why is this so unclear? Why not just list the Kindle Fire approval status separately in the Developer Portal. I thought the Android Market Developer admin was clunky, but this is even worse. iTunesConnect suddenly doesn’t look that bad…

Nowadays, to view your campaign performance (impression, clicks, conversions) by country, you can just go to the Dimensions tab in your Adwords online interface and select GeoGraphic from the View list on the top left. Make sure to select a date range long enough to have substantial data (say the past 3 months).

What’s up with movie fans in Italy?

I was looking at this report today for my Movie Collector campaign and I found that when sorting the report by Impressions, Italy was the 4th country in the list. This is strange, but doesn’t have to be a problem if the conversion numbers are similar. However, when sorting by Conversions (trial sign ups in my case), I found that Italy was at position 10. The conversion rate on those italian impressions was way lower than average. Looking at actual sales stats, the results were even worse: Italy was nowhere to be found in the top 20 countries.

It turns out that in my case, for this particular campaign, it doesn’t make sense to spend money advertising to Italy. So I removed Italy from the Country list in my Movie Collector campaign settings. Making my Adwords account a tiny bit more profitable again.

BTW: in my previous blog post about this topic I reported having removed Greece from my campaign settings. See the trend here?

Should you remove Italy from your campaigns too?

So do I have something against Italy? No of course not, on the contrary. I love Italy, italian people, italians cars, etc… And I love selling software to Italy and will continue to do so. But my stats just tell me that for my business, for this particular product, it does not make sense to spend my advertising money on Italy.

Am I suggesting you should remove Italy from your campaigns too? No, definitely not. My recommendation is just to take a look at your Adwords account, at the GeoGraphic reports for your campaigns and find out for yourself which countries you should be advertising to and which ones you should remove from your your campaign settings. As always: your mileage may vary.

The other solution

Of course, there’s a different action you could take after finding that ad impressions in a particular country don’t convert well. You could of course tweak your ads, tune your landing page, maybe even improve your product and try to increase your conversion rate there. And you should.
But still, while you’re doing all that, until your conversion rate has improved, I would still recommend lowering your ad spend in that country.

For instance, I am now investigating why Movie Collector doesn’t sell well in Italy. Maybe the Italian translation sucks, maybe I am missing some important Italian payment methods, maybe it’s just that the coverage of italian movies in our online movie database isn’t too great. All things that can be fixed., but that will take time. In the meantime, google.it isn’t getting my money.