ShareMyPlaylists.com/apples

What I’m listening to right now: Friday Funk

Post from Kieron’s Blog

Ping! Where have I seen that before?

Original post by Kieron

An upgrade or renewal email is an effective way to keep the customer “in the fold.” Some businesses bank on existing customers taking action directly from these emails, even charging the existing customer segment higher prices than resellers or their own website. This works if consumers are content to purchase without comparison shopping – but Elastic Path’s research into the buyer trends of software consumers shows this is not the case. Sign up for our September webinar Selling software to Consumers, Upgrade Now! to get a free copy of the research).

We found that 79% of software consumers actively look for a better price when renewing or upgrading their software. This makes sense – for years software publishers have been trying to generate high yields from upgrades, with little attempt to compete with the low prices available via their retail distribution channel. This example highlights the issue:

McAfee would like me to auto renew my subscription  for $79.99

which seams okay, because that’s what I’ve always paid since I purchased 3 years ago

but the retail price is now only $69.99 and today it’s on sale on McAfee’s site for $49.99 !

but a bit of comparison shopping finds that I can buy from BestBuy for $39.99

and finally I find the cheapest price in the Amazon Marketplace at $34.95

Shopping around and buying a new copy of McAfee Internet Security 2010 from a reseller (Amazon) would have saved me $45.04. In the end using the online chat feature on McAfee’s site I was instructed to do a manually renewal via my account, which enabled me to get McAfee’s current online offer price of $49.99. However I suspect had I just let the auto-renewal do it’s magic my credit card would have been charged $79.99.

Inflating the price may drive a significant percentage of customers to purchase from other selling channels, eroding your margins and potentially cutting off opportunity to remarket to them in the future (the reseller will send competing renewal notice or other cross-selling tactics).

The Threat of “Free” Alternatives

46% of the software consumers we surveyed reported that the availability of an alternative free version that they considered as good their existing software prompted them to switch. Charging higher prices than other sales channels increases the likelihood the shopper will switch to a competitor’s product or a free / open source alternative.

Perhaps a way to reduce consumers’ fear that they are not getting a fair deal when upgrading would be to show prices offered by resellers and ensure the renewal / upgrade is competitively priced against reseller offers. Also, offering a price guarantee like JourneyEd builds consumer confidence and increases the likeliness of a prompt renewal from an existing customer.

The takeaway is that publishers and service providers should think carefully when pricing upgrades and renewals for existing customers of non tangible goods. Consumers these days are wiser and have an arsenal of price comparison tools at their disposal to go hunting for a better deal. Not only do your customers feel like they are being taken for a ride, but many of them find an alternative product along the way. Although highly profitable, over charging for upgrades and renewals may be seriously affecting your attrition rate.

To find out more about the buying trends of software consumers sign up for our September webinar Selling Software to Consumers, Upgrade Now! where we will explore the findings of the online survey and look at actionable advice for software retailers to improve the online shopping experience. All registrants will receive a complimentary copy of the research “Consumer Software Buying Trends 2010″.

Original post by Peter Sheldon

Original post by Yahoo! News Search Results for Ecommerce

Original post by default@goarticles.com (Gen Wright)

Original post by Yahoo! News Search Results for Ecommerce

Original post by default@goarticles.com (Jimmy Guzman)

Original post by Yahoo! News Search Results for Ecommerce

Original post by default@goarticles.com (Abhimanyu Sharma)

Original post by Yahoo! News Search Results for Ecommerce

Original post by Matt

Original post by default@goarticles.com (Anna Jug)

Original post by Yahoo! News Search Results for Ecommerce

Original post by Yahoo! News Search Results for Ecommerce

Original post by Yahoo! News Search Results for Ecommerce

The Retail Email Index, which monitors the promotional email volume of the top 100 online retailers, reports that retailers on average sent a whopping 14.3 emails to each subscriber per month during November and December 2009, with 3.9 messages in the week ending December 18th (typical shipping cutoff date).

While increasing frequency may result in higher sales, there are dangers of sending so many messages. Smith-Harmon’s latest research report, the 2010 Retail Email Guide to the Holiday Season, asks you to consider the drawbacks:

1. The cost of replacing subscribers lost to higher churn
2. The sales lost because increased spam complaints caused delivery problems
3. The opportunity cost of lost sales due to higher ignore rates as subscribers tune you out because you are over-sending

On top of the spam issue, ISPs are factoring engagement (opens) as part of their reputation score calculation. Sending a lot of messages that subscribers ignore signals to ISPs your messages are not relevant, which can hurt your future delivery to subscribers across that ISP.

Does that mean you shouldn’t ramp up frequency at all? Heather Blank, vice president of strategic services at Responsys, recommends that marketers be strategic about increasing volume, identifying customer segments that are more tolerant of high volume.

You can segment out these customers by looking at previous engagement metrics like open rates, click throughs and purchase rates. You can also ask customers to update a “preference center” where they can choose frequency, types of offers and so on (but don’t rely on this tactic, as only a few will actively manage preferences).

For more holiday email tips, Smith-Harmon is offering their latest report free of charge.

Original post by Linda Bustos