sales – Walt-O-Matic

Snow Leopard: That Doesn’t Sound Like Apple

Had a very strange experience in the Apple Store in Reston, VA where I learned three very disturbing things. Snow Leopard purchasers beware. Hardware purchases, stop in your tracks.

I went to the Apple Store today with a friend that was looking at buying a MacMini and another friend that was picking up a copy of Snow Leopard, which sells for $29. That is, unless you’d like a copy for $25.

Apple’s policy toward operating systems has historically been a good one. There is no home, business, professional, expert, business, yadda-yadda-yadda flavors. There is no upgrade or full version. There is no pricing tier. Everything is one low price, you can upgrade or install fresh at any time.

And, if you buy a machine at the Apple Store it comes with the latest-and-greatest software, and if a new product on it comes out within 30-days, simply come back and pick up your updated version for either free or a very steeply discounted price. This is how it’s been at the Tyson’s Store for years. It shines of Apple customer service.

We went to the new Apple Store in Reston, VA and had the most disturbing news presented by Apple blue-shirt, John.

Unfortunately, I have no way of knowing at this time if what he told us is fact, fiction, or fallacy. So don’t take what you read here as gospel, but rather use it as guideline for formulating solid questions when you deal with Apple for the next few months.

#1) Apple had on display a Mac Box Set (OS X Snow Leopard, iLife ’09, and iWork ’09) for $169. My friend having iLife ’08 and iWork ’08 asked, “is it worth the cost to upgrade?” The Apple guy looked at us and said straight faced, “honestly, no… the features are minimal, just get Snow Leopard.” Now, I appreciate his honesty and opinion, and that alone commanded enough respect for me to retain trust in Apple — much like Macy’s sending people to Gimbel’s. However, I suspect we got lucky and that was not the Apple corporate line. Nor would pointing out you can get it for much less at about $114.

#2) We noticed the word “upgrade” all over the box and asked, “do you have to have Leopard installed to install this?” The answer, surprisingly, was yes. This was an upgrade and not a regular OS X disc like Apple historically has done. We were told that the real OS wasn’t coming out until December. Yes, December. When asked about machine recovery, he confessed they had a special version in the back they could use under dire emergencies. This begs the question if $29 is an upgrade price, with the ‘full’ OS will be the normal $120 later.

Update 31-Aug-2009: An Apple employee in BestBuy also confirmed what’s out now is an upgrade path. Although according to him, if you buy a new machine (with Leopard on it) you get the Snow Leopard update for free, which sounds like the Steve Jobs’s Apple policy we’re used to.

#3) When we asked about the MacMini, we were told that it had Leopard on it and that if we wanted Snow Leopard, we’d have to buy that for an additional $29. However, the electronic Apple Store online was selling MacMini’s with Snow Leopard already installed, without the extra cost. I probed deeply about this. Did the machines really have Leopard, and not Snow Leopard? Yes, the excuse was that they hadn’t moved inventory with the old OS on it. I asked if one simply got the upgrade for free like Tyson’s always used to do. Again, no. When I pointed out that buying online was the-cost-of-Snow-Leopard cheaper, I was met by an indifferent shrug.

All three of these things were very non-Apple.

Again, I don’t know if it was the sales person, the store in general, or Apple taking a page from the Microsoft book of marketing. But suffice it to say there was an abrupt halt on major purchases today.

Customers expect two things from a business, common sense and consistency. Price is often a very distance third.

A Side Note: Customer service plays a big role, and I have another Apple story which illustrates going above and beyond. In BestBuy, when we went to go get a copy of Snow Leopard, they were out of stock. However, while browsing another part of the store, the Apple employee came up and handed over a copy of Snow Leopard. Apparently, a FedEx shipment had just arrived, so he pulled one out of the box, and then hunted down our party in the whole store, on the off chance we hadn’t left yet. That’s service. You know that BestBuy’s floor staff would not have done that.

MacHeist 3: A Look At Group Purchasing Behavior

Have MacHeist sales stagnated? He’s my take on why, and what can be done to fix it, and how it has to play out… for the better!

As a glossed over quick introduction, MacHeist is a short-run sale of software packages for the Mac that has a twist. You pay $39 for a bundle of software, and some of that software is “locked.” A portion of your purchase price goes to charity, and the more money raised for charity, the more items in the bundle that get “unlocked.” Thus the more people buy, the more you continue to get. It’s a great scheme, only it isn’t working.

MacHeist, at the time of this writing, is conducting their third “heist” and after some amazing fluster of activity, new sales appear to have stagnated at an alarming rate.

Alarming to bundle purchasers, because if not enough sales happen, bundle purchasers won’t get all the amazing high-cost software at the extreme end of the bundle. What’s important about that statement is that it’s never happened before, and the problem isn’t the recession.

In informal polling, there appear to be two kinds of purchasers: early adopters and frugal purchasers.

The early adopter purchases the bundle early, knowing a good value when they see it, spurred on by the fact that there are additional incentives for doing so.

The frugal purchasers have their eye on either the final packages in the bundle, or are looking at the bundle as a whole. They don’t want to purchase the bundle until they know everything in it is unlocked.

And that’s the interesting part. If no one buys it, nothing gets unlocked. If everyone takes a risk, everyone gets handsomely rewarded, guaranteed. Thus each potential purchaser is waiting on the action of everyone else — it’s crowd mentality, only the driven behavior is idleness.

The secret ingredient is momentum. By carefully crafting a set of software incentives, under ideal circumstances the early adopter crowd overlaps with the late takers. This manifests itself as a steady stream of purchases.

It might be argued that The Directorate which runs MacHeist became victims of their own success and actually caused the problem by marketing the sale too well. Based on all the pre-sale puzzles, rumors, and incentives, there was a flurry of purchases in the early hours of the sale and projections seemed rather high.

However, one of the primary packages in the bundle required what looked like a high goal to unlock, the perception was that momentum was slowing. And perception drove reality. “Hmm, that doesn’t look like it’ll get unlocked, I think I’ll wait to see if it does before I buy,” is all it took to slow the influx of unlocking purchasers.

This was ill-timed, as it also happened to coincide with the reward for the first 25,000 buyers being removed from the table as the 25,000th bundle was sold. Days later, a only mere 5,000 more have sold and questions are being raised if the final packages will be unlocked.

The up-front fast burn created enough of a gap that people who were on the fence at different points became more segregated than usual. This didn’t happen in the last two sales.

So here’s my prediction: they have to fix this. Meaning, new incentives will re-emerge, the goals will have to be re-addressed, and it’s in the best interest of MacHeist to unlock the bundles anyhow at the end of it.

Turns out before I could finish this post, a new bonus was added, and that did stir a little traffic. But the real objective here is to convey there’s movement, specifically enough that the goal could be reached. That will inspire sales again, and in turn actually unlock the software. By re-calibrating the goal levels, this would solve the problem. In fact, the easy solution is to put all the last packages into one final, achievable goal.

The truth of the matter, however, is whatever happens will be remembered, if not chronicled in Wikipedia forever. If MacHeist goes down in flames for not unlocking all it’s bundled packages, people will be ever the more skeptical, and that means early adopters turning into late purchasers. That only exacerbates the problem, killing future sales opportunities.

By contrast, if the packages do get unlocked, whether by purchasers or by The Directorate making its own donation from the profits it receives, then MacHeist will be seen as more of a sure thing in the future, sliding more of the late comers and risk adverse customers into the early adopter side. This would actually increase future sales, because more gets unlocked sooner, enticing the skeptical buyers.

As such, “betting” on MacHeist with a purchase at this point still seems like a safe move. And, even if none of my predictions happen to come true, enough is unlocked already that the $39 price tag is still an awesome buy for the collection of software provided.

Reasonable Trial Durations: 30/30/30

I’ve come up with a way for trial software to be fair and recover lost sales opportunities. The secret: 30/30/30.

30/30/30 While doing Java development, I was looking for a new IDE for Windows. Naturally, my hunt ended with IntelliJ, with Eclipse and NetBeans close on its heels.

What started the whole chain of thought for me, though, was IntelliJ’s trial period. Frankly, I really respect a company that has enough faith in their products that they let you use them, unencumbered, for a month in order to make an informed purchasing decision.

Oddly enough, though, it wasn’t enough. Allow me to explain.

The purpose behind a trial period is to allow end users to “log enough flight time” with the product that they know whether or not it meets their needs.

And here’s the problem. I have an existing code base of inter-related projects that I need to import into the IDE. And, since this is for work, my schedule is fairly swamped. I can only come up for air to do an evaluation once every week or two just for an hour or so.

What inevitably happens is this: I install the software, validate it installs, then a week or so later, I try to import; it fails, so I table the project until I have more time. A week or two goes by, and I try again, getting closer. Then, when I come up for air and try to get a bit further, the evaluation period is over. I’ve realistically had about less than three hours using the software, and none of it in the IDE writing code.

This happened to me last year as well.

And, what’s the natural conclusion at this point? I don’t know if it will meet my needs or not. Thus, a purchase doesn’t happen.

From marketing’s perspective, they think that the following scenario is the norm: a user downloads the project, tries creating a project, slings a bit of code, gets married to the IDE, and is willing to pay to keep the experience. In fact, I’ve done just this, and I really love IntelliJ.

But, no matter how much love I have for the product, if I can’t move our corporate applications into it from an existing source base, I can’t justify the site-wide purchase. End of story.

Oh sure, I could talk with the kind folks at JetBrains and ask for an extension, and I’m sure they’d give me one.

But that isn’t the point.

Being a software provider myself, I see this as a generic problem. What if I want to produce trial software that’s fair. I can’t have my customers not being able to make a well informed decision for running out of time.

Here’s my solution… 30 days, 30 invocations, 30 hours – Whichever Comes Last

Here’s how it works:

You’re guaranteed at least a month of physical time.
You’re guaranteed at least 30 invocations.
You’re guaranteed at least 30 hours.
When all three of the above goals are hit, stop the trial.

Implementing this isn’t be hard at all. It’s also quite fair and balanced.

If you are doing real work, making use of the application for 30 days, then you’re going to quickly chew through the 30 invocations and 30 hours.

If you have just haven’t even tried the software enough, you get 30 attempts.

Finally, the 30 hour rule recognizes if you haven’t had time to actually experience the software.

I’d like to see vendors start taking this approach. It’s a good one, too. It would certainly result in more sales.