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Five new tricks for boosting upgrade sales.

Over the past few years, says Bill Mirbach, software upgrade offers have become flashier and more aggressive. "Today, when I go to the mailbox, the software mailings are all four-color and are full of pictures and stories and offers and deals," he says. "And the competition is just going to get more ferocious."

Mirbach, a direct mail expert who has created many of the industry's most effective upgrade packages, says this continuing escalation in upgrade offers has forced companies to keep testing new and innovative techniques. Recently, Mirbach described five different kinds of offers that almost invariably boost response rates:

* The Time Release Offer: The essence of this offer, says Mirbach,

is a no-risk free trial: Customers who order the upgrade pay

only a token amount in advance (usually $7-$8) for postage and

handling, with the understanding that if they like the product

their credit card will be charged 30 days later for the balance

due. If they don't like the product, they can keep it--for

free. "Everyone says, |it's too generous" says Mirbach. "But

good stuff gets paid for." Usually, a time release offer doubles

overall response rates, he adds, and only about a quarter of all

respondents decline to pay for the software.

* The Free Gift Offer: Gifts and premiums are "a gamble," Mirbach

admits. "But if you get the right gift, it's going to heighten

your response." (The usual lift is about 10% of current levels.)

Software--which usually costs very little to acquire or

manufacture--tends to be the most effective premium. Best bets:

general purpose utilities (except anti-virus programs) and

products that are "educational in a family setting."

* The Free Missionary Copy Offer: Since users often pass along

pirated copies of software to their friends, Mirbach says it's

often worthwhile to tell upgrade buyers they can give a copy

away legally--if they send in the friend's name. About 5%-10% of

customers will supply names of their friends, who in turn become

prospects for future upgrade sales. (A variation on this theme

provides upgrade buyers with an inexpensive second copy for a

secretary or co-worker.)

* The Sweepstakes Offer: Another reliable way to boost response

rates and collect more prospect names is to create a quarterly

sweepstakes. By trading for software with other companies, says

Mirbach, it's easy to put together a set of prizes that are

"cheap to you, and highly valuable to the user." (For example, a

hundred software suites worth $1,000 at retail add up to a

$100,000 sweepstakes pool.)

* The Sell-a-Friend Offer: "When you've squeezed every last nickel

out of your users, what do you do?" One solution, says Mirbach,

is to promise a free gift to any user who convinces a friend to

buy an upgrade. "This is a slow burn," he admits. "But the

likelihood of success is as close to perfect as you can get in

direct response."

Bill Mirbach, chairman, Mirbach & Associates, 301 Riverside Ave., Westport, Conn. 06880; 203/221-5200.
COPYRIGHT 1992 Soft-letter
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Publication:Soft-Letter
Date:Dec 31, 1992
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